Social
Supply Chain Management
Hyosung is committed to fostering a culture of responsible business practices with a wide range of partners within its supply chain. Various stakeholders recognize the establishment of a sustainable supply chain and the practice of fair trade as key components of corporate social responsibility. In response, Hyosung has established a sustainable supply chain operations policy and conducts regular supplier evaluations to systematically manage supply chain risks. Additionally, when entering into contracts with suppliers, Hyosung enforces compliance with the four key fair trade practices and operates a Fair Trade Compliance Program, striving to establish a culture of transparent and ethical business transactions.
Supply Chain Sustainability Management
Link CopySupply Chain Governance
Hyosung Corporation has established a sustainable supply chain management system under the ESG Management Promotion Committee, which includes board members responsible for supply chain-related matters and a supporting operational organization.
- Head of the ESG Management Promotion Committee
- CEO
-
Anyang Plant Manager
Managing suppliers and internal subcontractors
-
Head of the
Power & Industrial Systems R&D Center Head of the
Hyosung R&DB LabsManage R&D subcontractors
and procure development materials -
ESG Management Department
Suppliers Environmental and social capacity building support
Sustainable Supply Chain Policy
Hyosung has established a Sustainable Supply Chain Policy that outlines ESG-related key management issues and risk management processes across its supply chain.
- Environmentally
Friendly Purchasing -
Established classification principles for environmentally friendly products
Priority is given to suppliers that reduce negative environmental impacts
- Climate Change Response
in the Supply Chain -
Suppliers are required to calculate their greenhouse gas emissions and establish reduction plans
Support is provided through greenhouse gas related training and resources
- Human Rights and Labor
in the Supply Chain -
Forced labor and child labor are explicitly prohibited within the supply chain
- Support for
Capacity Building across
the Supply Chain -
Enhanced supplier productivity, strengthened ESG compliance capabilities, and improved climate response capacity
- Assessment & Due Diligence
- Prevention & Mitigation Measures
- Grievance Handling
- Monitoring
Sustainable Supply Chain Management Activities
-
1.
Excellent Partner Award
Hyosung recognizes excellent alliances with a special plaque and prize money for the 'Proud Hyosung Person of the Year'.
It helps alliances to understand the purpose of shared growth and be motivated. - 2. Commitment to Uphold the Supplier Code of Conduct
- 3. Establishment of an emergency scenario and response manual for supply chain continuity
- 4. Compliance with Conflict and Responsible Minerals Policy
Partner Registration & Evaluation
Link CopyRegistration & Evaluation of New Supplier
· New suppliers may freely apply for registration and get reviewed through the electronic procurement system.
· In addition to assessing quality, delivery, and price, the registration review also evaluates ESG risks such as compliance with environmental and safety laws, human rights and labor practices, and ethics.
· Final registered suppliers sign contracts that include ESG clauses and are required to submit a pledge to adhere to the Supplier Code of Conduct.
- Enlistment of suppliers
- Supplier selection review
- Final selection
(bidding to contract) - Transaction commencement
(ordering to delivery)
Regular Evaluation of Existing Suppliers
Existing suppliers undergo re-evaluation, and actions are taken based on performance grades.
| Category | Key Evaluation Items | Scoring |
|---|---|---|
| System, Price, Delivery | Quality management processes, number of defects, price competitiveness, on-time delivery performance, etc. |
65 |
| Management | Existence of ethical guidelines, compliance with anti-corruption and fair trade laws, donations and volunteer activities, etc. |
10 |
| Human Rights | Systems prohibiting child and forced labor, guarantee of freedom of association, gender discrimination prevention and maternity protection policies, etc. |
10 |
| Safety & Environment | Dedicated environmental organization, violations of safety/environment laws, environmental permits, frequency of safety inspections, etc. |
15 |
- A Over 90 : Priority given to the contract, exempt from reevaluation the following year
- B Over 80 : Priority given to the contract
- C Over 70 : Maintain transaction
- D Over 60 : Warning and guidance, special review within three months
- E Under 60 : Stop transaction
Fair Trade
Link CopyFour Key Fair Trade Practices
- Contract Execution Practices
- Partner Company Selection and Management Practices
- Internal Review Committee Establishment and Operation
- Written Document Issuance and Retention
Establishment of fair trade order
Hyosung fosters a culture of fair trade with its partners and implements and enforces the Fair Trade Commission-recommended company rules. The company regulations stipulate four fundamental procedures: contract signing, the selection and operation of partners, the establishment and operation of an internal deliberation committee, and the issuance and preservation of documents. By announcing guidelines for the prohibition of retaliatory acts, such as unilateral trade restrictions or suspensions, we hope to lay the groundwork for equitable partnerships and reasonable and transparent trade relationships.
Fair trade and social responsibility
Hyosung complies with the Fair Trade Commission's standard subcontract agreement and applies it to contracts. Clauses guaranteeing the physical and intellectual property rights of partners and the transfer of ownership of objects are included in standard subcontracting agreements, and we are committed to defending both types of property rights.
Compliance Program
Hyosung introduced the Compliance Program (CP), which is conducted by companies themselves to comply with fair trade laws, in September 2006 in an effort to foster a desirable fair trade culture. On June 1, 2018, the date of division, each business company inherited and introduced the plan. The Legal Compliance Team is responsible for the daily operation of the CP and strives to minimize fair trade-related risks through activities such as familiarizing all employees with the program's operating guidelines, fair trade training, and monitoring. The program's CP manager is a compliance officer appointed by the Board of Directors, and the Compliance Program Handbook, where employees can review program operation guidelines, is updated annually to assist employees in complying with fair trade laws and regulations despite changes in ethics-related laws and regulations and the environment.
Disclosure of fair trade principles to partners
Hyosung has enacted the "Supplier Code of Conduct" so that Hyosung and its partners can pursue sustainable growth and earn the public's trust. This facilitates the formation of transparent and fair trade relationships and the promotion of social responsibility standards to all of our partners. In addition, by publishing this code on the website, we announce our intention to fulfill it as a social promise, not as a contract with our partners.
