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Engagement

HS Hyosung Advanced Materials has established various stakeholder communication channels
to select key issues of sustainability management and transparently disclose the plans and
implementation status. Through the channels, we continuously reflect the opinions of
internal and external stakeholders in management strategies and decision-making.
Engagement

Engagement

Stakeholder Engagement

Types of Stakeholders

HS Hyosung Advanced Materials categorized eight stakeholders that could give or receive direct and indirect influence by management decisions. We plan to further expand stakeholders to a wider range including future generations and the natural environment.
Types of stakeholders

HS Hyosung Advanced Materials

  • Customer
  • Community
  • Partners
  • Academia
  • Shareholders & Investors
  • Experts
  • Employees
  • Government & Related Organizations

Stakeholder Channels

HS Hyosung Advanced Materials provides differentiated value to stakeholders by identifying their values and interests in accordance with our stakeholder engagement principle, which is then incorporated into our strategic direction. We encourage the participation of stakeholders through diverse channels, such as online and offline exchanges with customers, shared growth with partners, and local community councils, where major issues of each field are discussed. We also exchange opnions with external stakegholders through our membership in associations, initiatives, and alliances. We will continue our effort to earn the support and trust of stakeholders for the mutual benefit and long-term value creation of the company. as well as improve transparency and efficiency in management through stakeholder engagement.
  • Customer Customer
    Topic of
    Interest
    • Product quality and stability
    • Innovative R&D
    • Products satisfying customer needs
    • Continuous feedback
    Communication Channel
    • Company website
    • Exhibitions and technical exchange meetings
    • Customer satisfaction survey
  • Partners Partners
    Topic of
    Interest
    • Shared growth
    • Co-development
    • Fair trade
    • Support for cooperative program
    Communication Channel
    • Win-win programs
    • Supplier meetings
    • Support for partners’ capacity building
    • Support for partners' ESG education
  • Employees Employees
    Topic of
    Interest
    • Support for capacity building
    • Enhanced welfare benefits
    • Reinforced safety & health
    • Fair compensation
    Communication Channel
    • Labor-management council
    • Company intranet
    • HR counseling center
    • Town hall meeting with top management
    • Employee satisfaction survey
  • Community Community
    Topic of
    Interest
    • Social contribution
    • Community development and participation
    • Social responsibility for local environment
    • Environment information disclosure
    Communication Channel
    • Local community committees
    • Regional council
    • Environmental clean up with local communities
  • Shareholders & Investors Shareholders & Investors
    Topic of
    Interest
    • Management strategy for profit
    • Engagement in strategic decision-making
    • Governance soundness
    • Securing new growth engines
    Communication Channel
    • Board of Directors
    • Annual Shareholders’ Meeting
    • IR/Filings
    • Business reports
  • Government & Related Organizations Government & Related Organizations
    Topic of
    Interest
    • Legal compliance
    • Active engagement in government policy
    • Information disclosure
    • Reinforcement of operational efficiency
    Communication Channel
    • Government press release
    • Meetings and hearings
    • Seminars and forums
  • Academia & Experts Academia & Experts
    Topic of
    Interest
    • Technology development
    • Win-win through industry-university collaboration
    • Support for commercialization
    Communication Channel
    • Joint R&D
    • Jeonbuk Center for Creative Economy & Innovation

Materiality Assessment

Materiality Assessment Process

HS Hyosung Advanced Materials forms a key issue pool considering the impact of sustainability issues on the company as well as the impact of the company on the sustainability of the environment and society. Particularly, key issues are derived through s stakeholder survey, including employees, partners, and customers, upon which selection is made based on analysis each issue’s financial and socio-environmental impact. HS Hyosung Advanced Materials’ management approach and major achievements of these issues are disclosed in our sustainability report. We conduct a materiality assessment once a year and report the results to the Board of Directors for approval. The materiality assessment process generally consists of three steps.
Materiality assessment process
  1. Step 1 Issue pool formation We form an issue pool by considering management activities, such as corporate planning and mid- to long-term business strategies, global standards & principles, evaluation index, major issues of peers and the industry, and country risks
  2. Step 2 Priority evaluation We prioritize the selected issues through internal and external stakeholder survey, industry benchmarking, and media research
  3. Step 3 Key issue selection We report the evaluated issues to the SSC. The final key issues are decided through the BoD’s resolution
  4. Step 4 Key issue report We develop the Sustainability Report and plan detailed content in association with the key issues

2023-2024 Major Issues

Climate change response

Establish a GHG emissions management system across all global business sites Reduce workplace and product emissions based on a mid- to long-term roadmap to achieve GHG emission reduction targets Promote emissions reduction activities among partner companies

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Eco-friendly product and technology

Expand the development of products using recycled raw materials Develop green technologies and obtain certification considering LCA Identify and invest in suppliers of low carbon raw materials

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New growth engine

Develop technology and capacity to maintain competitiveness in existing business markets Expand the development of products using bio-base raw materials Invest to secure bio-base material production technology

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Supply chain

Update purchasing strategy Manage supplier's GHG emissions reductions Reorganize the supply chain management system to identify potential ESG risks and implement mitigation measures Support suppliers in improving identified ESG risks in their supply chain

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Occupational safey & health

Increase investment in safey & health Strengthen contiuous accident prevention activities Conduct emergency response training and education Internalize safety diagnosis activities Eliminate potential risk factors through risk assessment

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Customer value

Develop VOC activities Secure quality stability using big data Integrate management of global technology and equalize product quality Provide products that meet customer needs

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2023 Sustainability Reprot

2023-2024 Material Issues for External Stakeholders

Through HS Hyosung Advanced Materials' management activities, we aim to identify and manage material issues that may have a positive or negative impact on external stakeholders. From 2023 to 2024, we measured and monitored the societal and environmental impacts of climate change response and supply chain management, which are considered the most material among the six material issues.
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Climate change response

Climate change response
Type of Reporting Content
Category Climate transition & physical Risks
Value chain Operations
Business activity coverage >50%
External stakeholders/
impact areas evaluated 		Environment, Society
Type of Impact Positive/Negative
Our approach
  • Establish a GHG emissions management system across all global business sites
  • Reduce workplace and product emissions based on a mid- to long-term roadmap to achieve GHG reduction targets
  • Promote emissions reduction activities among partner companies
Topic relevance on
external stakeholders
  • By reducing GHG emissions, it helps lower carbon emissions across the entire value chain,
    thereby reducing the SCC (Social Cost of Carbon) when one ton of carbon dioxide is emitted into the atmosphere
Output Metric
  • Reduction amount of Scope 1+2 emissions compared to the base year 2021 (tCO2eq)
Impact Valuation
  • Social Cost of Carbon reduction (USD/tCO2eq)
Impact Metric
  • Approximately USD 17.1 Mil. = Reduction amount of Scope 1+2 emissions in 2023 compared to the base year 2021 × SCC
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Supply chain

Supply chain
Type of Reporting Content
Category Supply chain management
Value chain Operations, supply chain
Business activity coverage >50%
External stakeholders/
impact areas evaluated 		Supply chain, Society
Type of Impact Positive
Our approach
  • Update purchasing strategy
  • Reorganize the supply chain management system to identify potential ESG risks and implement mitigation measures
  • Support suppliers in improving identified ESG risks in their supply chain
Topic relevance on
external stakeholders
  • As environmental and social due diligence responsibilities for supply chains are being legislated, especially in the EU,
    suppliers need to enhance their capabilities to keep up with rapid changes in the external environment, including ESG factors
  • The effect of inducing added-value may increase as suppliers improve their capabilities
Output Metric
  • Amount of financial support for improving Korean suppliers' climate change response, safety management,
    and ESG capabilities (KRW, including training and advisory costs, equipment purchase costs)
Impact Valuation
  • Increased cost of added-value activities (KRW)
Impact Metric
  • Approximately KRW 190 Mil. = Added-value coefficient × Amount of financial support input cost