Sustainability
- ESG
- Environmental
- Governance
Kia reflects ESG factors in its supplier management and purchasing policies. In particular, for safety issues, violations of the Code of Ethics, and acts that impede shared growth, which are key elements of ESG, penalties(e.g. exclusion of bidding) are given through an internal deliberation to encourage suppliers to pay more attention.
In 2022, overseas parts makers are also included in the supply chain ESG evaluation target so that Kia is managing the ESG levels of all global parts makers transacting with Kia. A group of companies that require intensive management, such as core partners and high-risk partners, are managed separately.
In addition, the ‘Supplier Code of Conduct' was developed by reflecting domestic and foreign laws and regulations, the OECD Due-diligence Guideline, the Responsible Business Alliance, and major initiatives in the automobile industry(e.g. Drive Sustainability). The ‘Supplier Code of Conduct’ is shared with all global suppliers and used for accurate supply chain ESG diagnosis and improvement.
Kia will continue to carry out supply chain ESG evaluation and strive for improvement. In addition, we will expand support for Suppliers to protect human rights and strengthen ethical management.
Kia Supplier Code of Conduct
Purpose
Kia has enacted ‘Supplier Code of Conduct’ to establish a sustainable supply chain. This Code of Conduct strictly complies with the laws and regulations applicable to corporate management activities for all business partners, while requiring its partners to have the best operating practices in the field of ethical, environmental, labor/human rights, safety/health, and management systems. Kia expects that its partners will not only grow into a company that is respected by society, but also provide an opportunity for mutual growth by complying with this Code of Conduct.
Target
Applies to all business partners that provide goods and services to Kia or have entered into contracts for other transactions. All suppliers subject to this Code of Conduct may recommend that their entire supply chain, including business partners(i.e. sub-partners), comply with this Code of Conduct.
Main Components
| Ethics | Environment | Labor and Human rights | Safety and Health | Management system |
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Carbon Reduction in the Supply Chain
Kia is actively promoting carbon reduction across its supply chain partners, which account for a significant share of its value chain carbon emissions by supporting suppliers in developing carbon accounting capabilities and emissions reduction plans tailored to their specific operations.
Action Plan to Reduce Carbon Emissions in the Supply Chain
Kia will establish a carbon emission monitoring system for suppliers and encourage them to reduce carbon emissions. In 2021, Kia established a basic action plan to support our suppliers to reduce their carbon emissions based on the results of a survey of their carbon emissions and reduction plans.
Kia has signed a “Mutual Growth Agreement for Carbon Reduction in the Automotive Supply Chain” with stakeholders, including the government, Hyundai Motor Group, and 87 small/medium-sized suppliers to fulfill its social responsibility to enhance carbon competitiveness in the automotive industry. Major Tier 1 emitters are required to obtain third-party verification of site-level emissions and establish carbon reduction roadmaps, with progress monitored regularly. In the long term, Kia aims to reduce raw material emissions by expanding the use of low-carbon and recycled materials such as steel, aluminum, and plastics.
Also, Kia provides carbon neutrality training programs for employees of its suppliers; in particular, to strengthen capabilities in responding to global carbon regulations, Kia conducts specialized training sessions focused on key international carbon regulatory frameworks such as the CBAM. Through these initiatives, Kia systematically manages and verifies improvements in suppliers’ practical response capabilities.
Supply Chain Management System
Kia's supply chain ESG management is conducted for all suppliers, and we select core suppliers and high-risk suppliers to make priority improvements in consideration of the importance of technology and industry. For systematic evaluation and diagnosis of supply chain ESG, we conduct ESG on-line(written) evaluation for all tier 1 and core tier 2,3 suppliers and conduct due diligence(on-site) for suppliers who are suspected to be at risk. Regarding the risk of confirmation, we request implementation and monitor the progress of improvement.
Step 1
Pre- identific
Step 2
Desk-based Assessment
Step 3
On-site due diligence
Step 4
Remediation actions
Supply Chain Sustainability Goals
Supply Chain Risk Assessment
Kia identifies risks that are expected to occur or are actually occurring in the supply chain. As of 2025, there are 93 key 1st-tier suppliers selected through the pre-identification process, and 39 key 2nd to Nth-tier suppliers.
During this process, we identify and manage risks by country where our suppliers are located, business type, supplied part, and raw and subsidiary material. To this end, we use materials disclosed by each country’s government and research organizations as well as various media and social network materials.
Kia managed to complete risk evalutioon on all 1st-tier suppliers and key 2nd-tier suppliers. In-depth on-site ESG risk evaluations are conducted by ESG consulting and diagnosis and due diligence experts, in close collaboration with Kia's Procurement department.
The evaluation results are utilized to enhance supply chain risk management and support strengthening ESG implementation. Moreover, we advise suppliers to establish systematic safety and health management and environmental management systems by obtaining relevant certifications such as ISO 45001 and ISO 14001. We also manage the ISO certification acquisition rate among primary suppliers.
Supplier Risk Assessment and Due Diligence Results (2025)
Unit: Number of Companies| Category | Total | |
|---|---|---|
| ESG Risk Desk Assessment | Top Suppliers | 2,086 |
| Key Tier 1 Supplier¹ | 93 | |
| Key Tier 2 Supplier | 39 | |
| ESG Risk On-site Due Diligence | Top Suppliers² | 127 |
| Key Tier 1 Supplier³ | 5 | |
| Key Tier 2 Supplier | - | |
| High-Risk Supplier Identification | Top Suppliers | 25 |
| Key Tier 1 Supplier | 1 | |
| Key Tier 2 Supplier | - | |
| High-Risk Supplier Corrective Action Plans⁴ | Suppliers with an Agreed-upon Corrective Action Plans (CAP) | 25 |
| Key Tier 1 Supplier | 1 | |
| Key Tier 2 Supplier | - | |
| Suppliers with a CAP Implementation | 25 | |
| Key Tier 1 Supplier | 1 | |
| Key Tier 2 Supplier | - | |
| Terminated Suppliers due to Negative Impacts⁵ | - | |
| Key Tier 1 Supplier | - | |
| Key Tier 2 Supplier | - | |
- 1. Key supplier desk-based assessment rate 100%
- 2. High-risk suppliers (25) ESG on-site due diligence rate 100%
- 3. Including Key Tier 1&2 supplier and non-parts supplier
- 4. One Key Tier 1 supplier was identified with high-risk factors, then implemented 100% of improvement plans
- 5. The company’s penalty system is primarily based on bidding restrictions, and no cases involving risks severe enough to terminate business relationships have been identified through ESG assessments
Support for ESG in Partner Companies
Kia offers information on its ESG programs for partner companies, such as the programs’ procedures and requirements with the objective of enabling small and medium-sized or medium-sized partner companies to enhance their capacity to cope with the global ESG environment and regulations. We also provide consulting for them to establish ESG management systems.
Support for ESG in Suppliers
| Category | 2025 | |
|---|---|---|
| K-Mobility Bridge Foundation | Quality academy | 3,456 participants |
| General education | 4,869 participants | |
| Global win-win Cooperation Center | Industry-specific training, etc. | 93,806 participants |
| Enhance ESG capabilities | Training, consulting, etc. | 1,477 suppliers |