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Kia ESG Policy

We introduce our ESG policy book which contains Kia's policites on vaious ESG issues across the value chain. Kia establishes company-wide policies for ESG issues such as human rights, safety, and the environment to provide business standards and guidelines for us and our partners. We will continuously revise our policies in response to the changing environment.

ESG Governance

Kia is reinforcing ESG integration in the decision making process, overseen by the Sustainability Management Committee, which is an integral part of the Board, while closely monitoring ESG issues. Additionally, a dedicated sustainability management organization has been elevated to a division from a team, aiming to implement improvement tasks across all business sectors based on the newly established medium- to long-term ESG strategy. The progress is monitored through discussions within the council.

We are integrating ESG factors into the performance evaluation of top management, and each division and business unit to drive business operations and decision making from a sustainable management perspective. Specifically, in 2023, we have included ‘Establishment of ESG Framework’ as part of the KPI objectives and expanded its application to the overseas sector for the first time, encouraging the promotion of ESG-oriented business initiatives throughout the entire organization.

ESG Governance

Sustainability Management
Committee of BOD


ESG Council

Strategic Business Planning Division

Sustainability Management Division

Achievements for Enhanced ESG-oriented Decision-Making

Including 'Establishment of ESG Farmework' in the KPI objectives

Integrating ESG factors into performance evaluation to embed them throughout the company

Inclusion of ESG factors in the KPIs of the overseas sector for the first time (2023)

Assessing GHGs, renewable energy use, and sales of EVs

Implementation of review through Global ESG Council

First-ever Global ESG Council targeting key overseas regions such as Europe and North America

Integrated Risk Management

Risk Management System

Kia has established and is operating a company-wide risk management system to respond promptly and strategically to the rapidly changing internal and external environment. Through the Kia Management Strategy Meeting, a C-Level meeting hosted by the CEO, major company-wide risks are checked in advance and response strategies are discussed, and related risks are continuously monitored through organizations such as legal affairs/audit department.

Reponse to key risks

Kia is conducting risk appetite-based responses to major risks that may affect sustainability of business.
For issues with a low risk appetite, agendas are continuously presented at executive meetings, including the top management. Kia promptly responds to external changes through related councils. Major risks to the company are identified as legal/regulatory risks, product/quality risks, safety and health risks, and macroeconomic risks and managed accordingly.

In particular, in the case of laws/regulations, Kia, as a global company conducting business in various regions, is subject to various laws and regulations throughout the product value chain. Various regulations are being strengthened in relation to the use of parts in vehicles, and these regulations affect raw material procurement, partner management, and cost increase, and a company-wide response is required. In particular, in the case of the EU, there is a movement to strengthen regulations on the use of plastic in vehicles, and in order to respond to this, Kia is actively involved in R&D and implementation of technologies such as the operation of a TFT for expanded application of recycled materials and the recovery of plastic from scrap car parts through the operation of a pilot project of the scrap car network.

In addition, in the case of safety and health risks, it is one of the most important risks to be managed due to the nature of the traditional manufacturing industry, which operates its own business sites and supported by internal/external partners and relies on a large number of workers. In particular, with the strengthening of the Severe Accident Punishment Act in Korea, the business risk of safety and health issues is being further strengthened. In response, Kia has established the safety environment management system internal review program (KIA SEMS) according to the safety environment vision 2025 roadmap and has been promoting improvement activities every year. In 2023, we enacted safety and health management policies to prevent accidents that may occur throughout business operations, including the supply chain and business sites, and to promote the safety and health of workers.

In order to respond to various financial/non-financial risks as described above, we set related risk management indicators within KPIs for the CEO and management to provide compensation according to performance. The performance evaluation process takes into account various factors such as tenure, leadership, expertise, contribution to the company, and human resources development. Moreover, evaluations are conducted as per reasonable standards and on a variety of items, such as financial performance (business performance including sales and operating income which forms the basis of financial indicators such as ROE and ROI), comparative indicators (e.g. stock price variation vs. automotive industry peers, competitiveness evaluation, ESG Performance), the executive's performance and contribution, and internal/external business environment. Performance evaluations for executives, including the CEO, are conducted on a yearly basis, and all performance-related bonuses are determined through these evaluations.