skip to the main content

Preamble

As a global automobile company, Kia strives to become an innovative leader that leads the market and concentrates its capabilities to enable all its customers to enjoy innovative mobility that changes with the times. And the Company contributes to maintaining a sustainable society through continuous growth and active social responsibility as a global corporate citizen. Kia is establishing this corporate governance charter based on the belief that building sound governance can serve as a cornerstone for securing trust from all its stakeholders and carrying out diligent business activities as a respected global company.

Kia intends to continue to strengthen the diversity, expertise, and independence of the board of directors in order to maximize shareholder and customer value in accordance with this charter. Under the supervision of the board of directors, the Company shall pour every effort into enhancing the balanced rights and interests of its stakeholders including shareholders, customers, employees, and suppliers by promoting transparent and responsible management. In addition, the Company shall fulfill its corporate social responsibility relating to environmental and social problems beyond its economic growth while preemptively responding to changes in the new paradigm.

Ⅰ. Shareholders

1.1 Rights of shareholders
  1. Shareholders shall have the following basic rights as owners of Kia (hereinafter referred to as the "Company").
    • The right to participate in profit sharing
    • The right both to attend and to vote at general shareholders meetings
    • The right to obtain relevant company information in a timely and regular manner
    • Other rights guaranteed by related laws such as the Commercial Act and articles of incorporation
  2. The following matters that bring about significant changes in the Company's existence and shareholder rights shall be decided in the pursuit of maximizing the rights of shareholders at general shareholders meetings.
    • Changes in articles of incorporation
    • Mergers, business transfers, and spin-offs
    • Dissolutions
    • Capital reductions
    • All-inclusive exchanges or transfers of shares, etc.
  3. Shareholders' rights shall be exercised conveniently according to the free will of the shareholders. In order to facilitate the exercising of shareholders' rights, the Company shall provide information on the time, location, and agendas of a general shareholders meeting with enough time beforehand, and shall set the time and location of the meeting such that the maximum number of shareholders can participate.
  4. Shareholders may propose an agenda item for a general shareholders meeting and question or demand explanation regarding the agenda items at the meeting in accordance with relevant laws such as the Commercial Act.
1.2 Fair treatment of shareholders
  1. Shareholders shall hold the right to one vote per share, and there shall be no infringement on basic shareholders’ rights. However, the restriction on voting rights for certain shareholders shall be strictly carried out in accordance with relevant laws.
  2. The Company shall provide the shareholders with sufficient information in a timely and easy-to-understand manner. Moreover, even when unveiling information that it is not required to disclose, the Company shall offer it to all shareholders in a fair manner.
  3. The Company shall protect its shareholders from unfair internal transactions and self-transactions by other shareholders such as controlling shareholders.
1.3 Responsibilities of shareholders
  1. Shareholders shall recognize that the exercising of their voting rights may affect the management of the Company and strive to actively exercise voting rights for the development of the company.
  2. Controlling shareholders wielding influence on the corporate management shall act in the best interests of the Company and all its shareholders. If any of their actions damage the Company and its other shareholders, the controlling shareholders shall bear corresponding responsibility.

Ⅱ. The board of directors

2.1 Functions of the board
  1. The board of directors shall have comprehensive power over corporate management, and shall perform the major management decision making and management supervision of the Company.
  2. The board may delegate its authority to the representative director or its internal committee. However, the major issues stipulated in laws, articles of incorporation, and the provisions of the board of directors are excluded.
2.2 Composition and operation of the board of directors
  1. The number of board of directors shall be somewhere from seven to eleven to allow various opinions and efficient decision making. In order to perform independent and substantive management oversight of the board of directors, the number of outside directors who are recommended by the outside director recommendation committee shall exceed half of the total number of directors.
  2. The board of directors shall appoint the chairperson of the board for a three-year term at the first board of directors meeting after the general shareholders meeting. The chairperson of the board of directors shall preside over the board and ensure that the role of the board is effectively carried out in all respects.
  3. The board shall hold regular meetings and frequently hold ad-hoc meetings if necessary. In addition, for the smooth operation of the board of directors, the board shall establish and abide by the board of directors' rules stipulating the authority, responsibilities, and operating procedures of the board of directors.
  4. The board of directors shall keep minutes of every meeting to preserve the contents of the meeting and use remote telecommunication as necessary to enable the maximum number of board members to participate in the board meeting.
2.3 Qualifications and independence of directors
  1. Directors shall meet qualifications in accordance with relevant laws and regulations. They shall have the highest ethical standards, a strong sense of professionalism and honesty, and shall be able to represent the rights and interests of all shareholders and stakeholders in a balanced manner.
  2. Directors shall be able to devote enough time to perform their duties and shall have strategic thinking, practical knowledge, mature judgment, and a sense of responsibility.
  3. Outside directors shall have abundant expertise and practical experience in related fields such as finance, economics, management, law, accounting, etc., or shall be domestic or overseas professional managers or future technology experts. And they shall have no significant interests with the Company and shall be able to make impartial decisions.
2.4 Appointment of directors and recommendation of candidates
  1. The Company's directors shall be appointed at a general shareholders meeting through the recommendation of the board or the outside director recommendation committee, and the Company shall provide shareholders with sufficient information on the candidates for directors and enough time to judge them.
  2. Outside directors shall be appointed at a general shareholders meeting following the recommendation of the outside director candidate recommendation committee, more than half of which is composed of outside directors in order to select a competent and responsible person in a balanced manner who has the expertise to contribute practically to the management of the Company. However, one outside director who will be appointed as the shareholder rights protection representative of the transparent management committee shall be recommended directly from the general shareholders and agreed to by the outside director candidate recommendation committee after an objective and independent evaluation by the external evaluation team.
2.5 Roles of outside directors
  1. Outside directors participate in major decisions of the Company through the activities of the board, supervise management as members of the board of directors, and support management through constructive advice.
  2. Outside directors may request the provision of information necessary for the performance of their duties. Furthermore, if necessary, outside directors can consult external experts through appropriate procedures and the Company will support the expenses incurred.
  3. The Company shall regularly report or provide management information such as the project status of the Company so that outside directors can figure out the management status of the Company in a timely manner, and operate continuous education or training programs for outside directors.
2.6 Responsibilities of directors
  1. Directors shall act in the interests of the Company and its shareholders by carrying out their fiduciary duties, and not disclosing information obtained in the course of their duties or using it for personal gain.
  2. If a director violates the laws or the articles of incorporation or neglects his/her duties, he/she shall be liable for damages to the Company and if there is malicious intent or gross negligence on the part of the director, he/she shall also be liable for damages to a third party. However, if a director performs his/her duties in a manner that is deemed to be the best interests for the Company in a sincere and reasonable manner in the course of making business decisions, such management judgments of the director shall be respected.
  3. The Company shall take out director liability insurance for directors at the expense of the Company in order to reduce the burden of liability for the directors and help secure competent directors.
2.7 Committees of the board
  1. The board of directors may establish and run committees within the board to enhance the expertise and efficiency of its operations.
  2. The composition and operation of a committee shall follow the regulations of each committee separately determined, and the opening and closing of the regulations shall be made by resolution of the board of directors.
  3. The organization, operation, and authority of all committees shall be specified in clear terms. The resolution of a committee on matters delegated by the board shall have the same effect as a resolution of the board.
2.8 Transparent management committee
  1. The transparent management committee shall resolve the following matters for the purpose of reviewing the transparency of internal transactions and the protection of shareholder rights and interests.
    • Related party transactions prescribed in the "Commercial Act," the "Monopoly Regulation and Fair Trade Act," and the "Capital Market and Financial Investment Business Act"
    • Matters concerning the protection of shareholders' rights and interests
  2. The Company shall report the following matters to the transparent management committee for the purpose of carrying out social responsibility and ethical management.
    • Checking the implementation of a compliance program
    • The main policies related to ethical management and social contribution
    • The enactment and revision of ethical standards such as the code of ethics and the evaluation of its implementation status
    • Quarterly major social contribution performance including a donation of KRW 1 billion or more for the immediate previous quarter
  3. To better communicate with shareholders, the transparent management committee appoints one outside director recommended by the general shareholders as a representative responsible for protecting shareholders' rights and interests, and his/her role covers:
    • Communications between the board of directors and shareholders through attending major IR events and meetings with shareholders
    • Delivering opinions and proposals related to shareholders' rights and interests to the transparent management committee and the board
    • Continuing to explore and propose policies to improve the protection of shareholders' rights and interests
  4. In order to improve independence and transparency, the transparent management committee shall consist of only outside directors. And the Company shall provide all the information and expenses necessary for the committee's activities as much as possible and continuously operate education or training programs to boost professionalism.
  5. The transparent management committee shall hold quarterly meetings on a regular basis, and if necessary, shall hold frequent ad-hoc meetings. It shall also draw up minutes at each meeting. In addition, annual activities shall be disclosed through various channels such as the governance report to be accessible to all shareholders.
2.9 Evaluation and compensation
  1. The business activities of management shall be fairly evaluated and the results shall be appropriately reflected in remuneration.
  2. Remuneration of the directors and necessary business expenses shall be paid within the scope of the payment limit determined at a general shareholders meeting.
  3. Remuneration of directors shall maintain a reasonable relationship proportional with their duties and be set at an appropriate level given the financial conditions of the Company.

Ⅲ. Auditing system

3.1 Auditing committee
  1. The auditing committee shall consist of three or more directors appointed at a general meeting of shareholders and shall include one or more accounting or financial experts. In addition, at least two-thirds of the total members shall be outside directors in order to perform an independent and transparent auditing role.
  2. The auditing committee shall carry out the following functions:
    • Ensure the auditing legality of directors’ and executives' business activities
    • Review the soundness and feasibility of the Company's financial activities and the accuracy of financial reporting
    • Select, appoint and dismiss external auditors
    • Other matters prescribed by laws and articles of incorporation and regulations of the auditing committee
  3. The auditing committee shall convene at least once a quarter and, if necessary, may include executives, financial officers, and external auditors.
  4. The auditing committee shall keep minutes of every meeting, freely access the information necessary for the auditing work, and be able to receive advice from external experts when necessary. It shall also be independent of management and the controlling shareholders, and its members can only receive remuneration as directors and no other compensation.
3.2 External auditors
  1. External auditors shall maintain legal and substantive independence from the Company, management, and controlling shareholders.
  2. External auditors shall attend general shareholders meetings and respond to shareholders’ questions regarding the audit reports.
  3. An external auditor shall be responsible for compensating for any damages incurred to the Company and other information users due to his/her careless audits, and shall check whether there is any information that goes against the audit results among the information disclosed regularly along with the audited financial statements. In addition, he/she should make every effort to check whether the Company conducted a fraudulent or illegal act during the audit.
  4. An external auditor shall consider the sustainability of the Company as required by the relevant laws and regulations such as the "Act on External Audit of Stock Companies" and report to the auditing committee important matters confirmed during the external audit activities.

Ⅳ. Stakeholders

4.1 Stakeholders
  1. The Company shall endeavor not to infringe on the rights of its stakeholders including customers, employees, suppliers, and local communities, and fulfill its social responsibilities such as consumer protection and environmental protection.
  2. The Company shall strive to respect the rights of its workers, improve the life quality of its workers, and drive the balanced development of the national economy by promoting the establishment of a fair market order through compliance with fair trade laws and regulations.
  3. The Company shall comply with creditor protection procedures for matters that have a significant effect on the status of creditors such as a mergers, capital reductions, and spin-offs.
  4. When a person serves as not only a stakeholder but also a shareholder, the Company shall guarantee his/her rights thereof respectively. And the Company shall provide a stakeholder with the information necessary for the protection of his/her rights to the extent permitted by laws and regulations and he/she shall be able to have easy access to the information.

Ⅴ. Management surveillance by market

5.1 Disclosure
  1. In addition to the disclosures required by laws and regulations, the Company shall disclose matters that gravely affect or may affect shareholders’ or stakeholders' decision making.
  2. The Company shall regularly prepare and disclose business reports, quarterly and semi-annual reports, etc., and when it determines matters to be beyond regular disclosure, it shall disclose the details in a timely manner with concrete and accurate information.
  3. The Company shall strive to make these disclosures easy to understand, make them easy for stakeholders to utilize, and designate a person responsible for the disclosures so that important information on the Company can be promptly sent to him/her.
  4. The Company shall disclose the shareholding status of the actual controlling shareholders and their related parties in detail.
  5. The Company shall not give preferential treatment to or discriminate against a certain person on the basis of the scope and timing of the disclosure of important corporate information, and shall make such information accessible to every stakeholder at the same time.
5.2 Market for corporate control
  1. Acts that cause changes in corporate management rights, such as acquisitions, mergers, spin-offs, business transfers, etc., shall be carried out through transparent and fair procedures.
  2. The act of defending corporate management rights shall not be conducted in such a way as to sacrifice the interests of the Company and its shareholders in order to maintain the control of some shareholders or management.
  3. The Company shall ensure that shareholders who oppose significant structural changes, such as mergers and business transfers, exercise their appraisal rights at a fair value reflecting the real value of the shares, as required by relevant laws and regulations.