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LG Energy Solution builds a circular battery ecosystem in line with
carbon neutrality and drives sustainable growth across diverse industries.

Board of Directors

LG Energy Solution has formed its Board of Directors with members who possess expertise across diverse fields to support sound decision-making. The company appoints a majority of its directors as independent directors and has established and advanced systems to ensure their independence.

Board Composition

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Kwon, Bong Seok Chairman/Non-standing Director

Mar, 2022~ Mar, 2028

  • Vice Chairman, COO of LG Corp
  • Former President, CEO of LG Electronics
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Kim, Dong Myung Director

Mar, 2024~ Mar, 2027

  • Executive President,
    CEO of LG Energy Solution
  • Former Advanced Automotive Battery Division
    Leader of LG Energy Solution
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Lee, Chang Sil Director

Dec, 2020~ Mar, 2028

  • Executive Vice President, CFO of LG
    Energy Solution
  • Former Senior Vice President,
    Business Management Department of LG Chem
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Shinn, Mee Nam Independent Director

Jun, 2021 ~Mar, 2026

  • Former CEO of Auction
  • Former President,
    Doosan Fuel Cell Business Unit
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Yeo, Mee Sook Independent Director

Jun, 2021 ~ Mar, 2027

  • Professor,
    Hanyang University School of Law
  • Former Presiding Judge, Seoul High
    Court/Seoul Central District Court
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Han, Seung Soo Independent Director

Jun, 2021 ~ Mar, 2027

  • Professor,
    Korea University Business School
  • Vice Chairman, Korean
    Association for Accounting and Policy
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Park, Jin Kyu Independent Director

Mar, 2023~ Mar, 2026

  • Specially appointed professor,
    University Research Institute Industry
    Collaboration Center, Korea University
  • Former 1st Vice Minister,
    Ministry of Trade, Industry & Energy
Articles of Incorporation
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Guidelines on Independent Directors' Independence and Expertise &
Diversity of the Board of Directors

LG Energy Solution’s Board of Directors constitutes more than majority of Independent directors in order to ensure the transparency and effectiveness of its governance structure and their reappointments are determined based on the evaluation of their activities and performance. In line with ‘Guidelines on the Expertise and Diversity of the Board of Directors’ and ‘Guidelines on Independent Directors’ Independence’, we strive to ensure that the Board consists of expert directors holding a diversity of experiences and perspectives to facilitate reasonably prudent decision-making process. We will continue to strengthen the independence, expertise and diversity of the Board and reinforce the sustainable governance system.

Guidelines on Expertise and
Diversity of the Board of Directors
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 Guidelines on Independent
Directors' Independence
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Corporate Governance Charter

LG Energy Solution established Corporate Governance Charter alongside Articles of Incorporation, which defines the company’s objectives and outlines the rules for its operations, in the belief that governance integrity promotes transparent and responsible business activities, which serve as a foundation to fulfilling social responsibility and creating sustainable values of the company.
Based on this Corporate Governance Charter, LG Energy Solution protects the rights of shareholders and treats them fairly; establishes the transparency and accountability of the business through the Board of Directors and the Audit Bodies, which are structured and operated in an independent and experts manner; and strives to be a socially responsible company that respects the rights of various stakeholders.

Corporate Governance Charter
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Committees

Committee Composition

Chairman

Members

Committee Composition
Category Name Audit Committee ESG Committee Nomination Committee for
Independent directors 		Internal Trade
Committee 		Management
Committee
Independent director Han, Seung Soo Chairman Members Members Members
Independent director Shinn, Mee Nam Members Chairman Members
Independent director Yeo, Mee Sook Members Members Chairman Chairman
Independent director Park, Jin Kyu Members Members
Independent director Kim, Dong Myung Members Chairman
Independent director Kwon, Bogn Seok Members
Independent director Lee, Chang Sil Members Members
  • Audit Committee Duties: It audits accounting and business operations to increase internal control and management transparency.
  • ESG Committee Duties: As the highest reviewing body on ESG management, it establishes basic policies and strategies in ESG, such as environment, safety, social responsibility, customer value, shareholder value, and governance structure, and reviews mid to long-term goals.
  • Internal Trade Committee: To strengthen the transparency and fairness of internal transactions, it reviews the following: transactions subject to extortion-related regulations under the Fair Trade Act; transactions with the largest shareholder and related parties under the Commercial Code; internal transactions that require approval from the Board of Directors under other laws and regulations.

Appointment Process of Independent Directors

01 Resolution by the Nomination Committee - Vote on the nomination of independent directors Propose to the Board of Directors. 02 Resolution by the BOD - Approve nomination Propose the plan to the shareholders’ meeting. 03 Resolution by the Shareholders’ Meeting - Appoint Independent directors.

Compliance Management

LG Energy Solution operates compliance control regulation and compliance management system (CMS) to identify and prevent compliance risks in major areas related to business activities such as fair trade, product quality, environment and safety, information security, and anti-corruption.

Compliance Governance

A compliance officer, designated by the Board of Directors, is responsible for overseeing compliance controls and monitoring the company-wide compliance management system. The compliance officer is mandated to report, biannually, to the Board of Directors and its ESG Committee on the progress of key compliance risks control, improvement plan and key findings from regular audits of effectiveness of the CMS to ensure the CMS meets evolving requirements of global standards and customers’ demands.

Key roles and responsibilities of a Compliance Officer include

  1. 1

    Monitoring compliance controls on a regular / ad-hoc basis and reporting key findings to the Board of Directors

  2. 2

    Providing training and education to employees to promote awareness and understanding of compliance obligations

  3. 3

    Identifying and assessing legal and compliance risks

  4. 4

    Handling non-compliance cases from identification of non-compliance, consultation to advising on the appropriate actions

  5. 5

    Executing disciplinary actions for employee non-compliance

Compliance Management System(CMS)

LG Energy Solution’s Compliance Management System (CMS) is a comprehensive framework that enables to effectively identify and address global legal and regulatory requirements and risks in key areas relevant to our global business, as well as monitor and manage compliance activities within LG Energy Solution and its operating sites. These areas include fair trade, product quality, environment and safety, information security, and anti-corruption. The CMS is overseen by the Compliance Team under Compliance Officer’s leadership, in collaboration with relevant departments. In 2023, LG Energy Solution launched a ‘Compliance Portal’ within its intranet, to enhance the systematic management of compliance control activities carried out by each and every relevant department. The Portal serves as a centralized database to document and track all activities and facilitates effective monitoring and performance management.

In November 2021, LG Energy Solution became the first company in the global battery industry to obtain ISO 37301, an international certification for the establishment of a global compliance management system. Going forward, the company will continue to enhance transparency and trust with customers and various stakeholders, while strengthening its competitive edge in the field of global compliance management.

CMS-based Compliance Risk Management Process

LG Energy Solution's Compliance Management System (CMS) identifies and evaluates compliance risks every year and establishes compliance goals to address and prevent them. They monitor violations and/or illegal activities and carry out evaluations to continuously improve CMS.

01 Identification and Assessment of Compliance Risk. 02 Target Setting. 03 Risk Prevention and Remediation Activities. 04 Monitoring and Evaluation of Compliance Activities. 05 Corrective Measures Planning and Implementation. 06 Regular Audit of Compliance Management System. 07 Reporting to the Board of Directors.

  1. Identification and Assessment of Compliance Risk

    This step involves close and continuous monitoring of regulatory and policy landscape in relevant countries to identify potential compliance risk that may arise in our daily business operations. Once potential risks are identified, we assess the current level of compliance with relevant regulations. Based on the assessment, key risks are defined to prioritize compliance activities.

    • Compliance Management Areas

      Compliance management areas include, but not limited to, fair trade, environment and safety, product quality, intellectual property, information security, human resources management (including sexual and non-sexual harassment), trade and customs, foreign exchange, tax, and anti-corruption.

  2. Target Setting

    The next step is to establish targets and measures to prevent the risks identified and assessed in the previous step. By risk area, relevant departments are responsible for setting quantitative targets, timeline and appropriate compliance activities in relation to their respective roles.

  3. Risk Prevention and Remediation Activities

    Activities range from development and/or revision of company policies, regulations, manuals and relevant guidelines, training and education, progress monitoring, to IT system development and improvement.

  4. Monitoring and Evalution of Compliance Activities

    This step aims to monitor and evaluate potential non-compliance activities that may arise in assuming the roles of relevant departments. Based on key findings from monitoring and evaluation, root cause analysis and improvement planning follows.

  5. Corrective Measures Planning and Implementation

    The analysis of root cause and area of improvement informs planning of corrective measures. The concrete plans are established and implemented in coordination across relevant departments and/or with monitoring department.

  6. Regular Audit of Compliance Management System

    The CMS are audited on a regular basis to ensure continuous improvement. The regular audit is designed to evaluate the relevance and effectiveness of risk prevention measures, compliance trainings, and progress made in achieving the targets.

  7. Reporting to the Board of Directors

    As the highest decision-making body within LG Energy Solution, the Board of Directors (BoD) plays a crucial role in overseeing compliance matters. In accordance with the Korean Commercial Law, the BoD has the authority to appoint a Compliance Officer and must be informed about key compliance issues regularly to make relevant decisions. In accordance with LG Energy Solution's ESG Committee Regulation, the ESG Committee under the BoD assumes the role of supervision of the company-wide compliance management. It facilitates and formalizes active engagement of BoD in compliance issues and continuous improvement of the CMS.

Corruption Risk Management

In order to enhance transparency and foster trust among our stakeholders, LG Energy Solution is committed to effectively managing and mitigating the risks associated with corruption and bribery.
LG Energy Solution strictly prohibits corruption or bribery in any form. We uphold these principles with unwavering commitment and undertake various measures to effectively manage corruption risks through our Compliance Management System.

To ensure the compliance, we conduct close monitoring of legislative revisions and new enactments, as well as policy and regulatory landscape in relevant authorities. We assess legal and regulatory requirements and identify any potential or actual risk and control measures on a continuous basis. The control measures are also regularly monitored and evaluated to identify areas for improvement to ensure their effectiveness.

LG Energy Solution takes a comprehensive approach to managing corruption and bribery risks, specifically through establishment and implementation of an Anti-Bribery Policy, operational rules, guidelines, and checklists. We continuously review and manage these ethical standards to ensure they are in compliance with laws and regulations in all applicable jurisdictions, as well as global standards. The update and revision of our ethical standards is made taking into account the results from the review and audit. All employees at LG Energy Solution are required to sign the "Pledge of Compliance with Bribery Prevention Acts" and complete mandatory trainings to raise awareness and promote a culture of anti-corruption. We also require supplier’s compliance with our regulations. All suppliers shall sign the "Jeong-do Management Pledge." Further, suppliers’ corruption and bribery risks are monitored through LG Energy Solution’s supply chain due diligence process.

Anti-Bribery Policy
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Anti-Bribery Guidelines for Employee
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ISO37001 Certification
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Fundamental principles regulated by Anti-Bribery Policy and Guidelines

  • Compliance with anti-bribery and corruption laws and regulations
  • Guide to conduct when contacting public officials, etc.
  • Prohibition of bribery (money, goods, etc.)
  • Prohibition of improper solicitation
  • Accurate and proper accounting and record-keeping, and prohibition of money-laundering
  • Third-party corruption risk assessment and prevention.
LG Energy Solution's anti-bribery management system is based on ISO 37001, an internationally recognized certification for anti-bribery management systems. The ISO 37001 certification process is on-going with sites in Korea and Poland to be certified by 2024, and the certification process for the remaining subsidiaries will follow.

Ensuring Business Resilience

Risk Management System

LG Energy Solution has established a risk management system and formed dedicated organizations to build a sustainable management framework. Through this system, the company identifies, prevents, and monitors enterprise-wide risks in advance. Under the Enterprise Crisis Management System, LG Energy Solution analyzes risks in areas such as quality, safety, supply chain, business, finance, and social and environmental factors, and carries out appropriate response activities. In risk response, the company evaluates not only financial impacts but also sustainability factors such as safety and the environment, assessing the level of risk accordingly.
Placing the safety of employees, local communities, and consumers as its top priority, LG Energy Solution has appointed a Chief Risk Officer (CRO) as the executive responsible for risk management and operates a specialized organization for proactive risk control. The company has designated quality, environmental safety, and compliance as key risks, and is strengthening its quality management system, enhancing environmental and safety measures in line with business expansion, and building partnerships to stabilize its supply chain.LG Energy Solution will continue to advance its risk management framework to minimize potential risks arising from business operations

Risk Owner. Subcommittees by function/organization. Company-wide Risk Management Committee: Risk management team, Chief Risk Officer: CRO, In case of emergency Company Emergency Committee. BoD. Compiling, Supporting, Report, Approval·Verification.

Risk Management Process

  • Risk Identification

    LG Energy Solution operates a company-wide risk management system to identify and mitigate risks and increase sensitivity to potential risks that may evolve into crises. All employees are well informed of our and use it as the basis of their work. We pinpoint risks in various areas by analyzing our mid- to long-term strategies and work processes and conducting interviews. Further, in order to prevent risks and mitigate damage in the event of a crisis, we focus on assessing changes in the business environment when developing medium-to long-term strategies and business plans.

  • Crisis Response

    To prevent the escalation of crises and quickly normalize situations, LG Energy Solution established corporate crisis management regulation. In the event of a crisis, our corporate crisis response system is initiated chaired by company Emergency Committee. The relevant department should immediately share the outbreak of crisis with the Risk Management Committee of the headquarters. When responding to key risks, the first priorities are the life and safety of customers, local communities, and members.

  • Post-crisis
    Management

    Once the crisis is over, the risk management organization monitors the process of implementing measures to prevent recurrence and verifies the results. The organization also lists up inventory in emergencies and impacts, develops scenarios including the decision-making process of the company Emergency Committee, and conducts mock training sessions to improve its crisis response capabilities. Furthermore, we prevent the recurrence of similar crisis by updating our manuals and systems for crisis response and horizontally carrying out improvements.

  • Strengthening Risk
    Management
    System

    LG Energy Solution acquired certification on the business continuity management system (BCMS, ISO 22301) for the headquarters and domestic manufacturing plant in December 2021. We plan to obtain additional certifications for our overseas business sites by establishing practical risk management frameworks at facility level and enhancing our risk management activities.

Ethics Management

Jeong-Do Management refers to LG’s unique code of conduct based on ethical management, which targets steady cultivation of competence to run fair competition.
The LG Code of Ethics, the standard for proper behavior and value judgment that all LG members must abide by, and Compliance Guidelines for understanding and responding to legal risks that may arise in the course of business, are all based on Jeong-Do Management. It also serves as the foundation for all LG Energy Solution’s business activities conducted by employees across all global business sites. With a view to ensuring Jeong-do Management in a systematic and coherent manner, we have a designated organization called the Ethics Secretariat. The secretariat is mandated to promote awareness and conduct ethics trainings to all employees across global sites, investigate and communicate on reported cases, and conduct ethics trainings for suppliers. Further, it identifies major ethical issues and conduct audits annually of employees for violations of ethical standards, such as misconduct, sexual and/or workplace harassment. In line with the compliance management system, we also monitor compliance related to ethical issues for all global business sites regularly and as needed.

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Process

LG Group, including LG Energy Solution, operates the Jeong-Do Management website. It serves as a channel for external stakeholders to report on customer complaints regarding product, service and quality, as well as for employees and partner companies to report on any unethical or illegal behavior, including bribery, solicitation/graft, embezzlement/misappropriation of assets, environmental and safety accidents, unfair trade practices, document manipulation, and sexual/workplace harassment and abuse.
Under the principle of informant protection, any information that exposes the ID of the informant or suggests it is not disclosed without consent of the informant, and we are held liable for any disadvantage incurred by failure to observe this by making restitution or equivalent action.
Further, we have put in place a whistleblower reward program to enhance the transparency and accountability of our business, as well as eliminate unethical or illegal behavior that undermines customer value.

Receipt of Report - Registration of received report. Plan for Investigation - Confirmation of the scenario, Subject, Schedule, Content of. Investigation - Preliminary, on-site, and follow-up investigation. Post-Investigation - Report to management including investigation results. Follow-up Management - Follow-up measures, Verification of any disadvantages incurred to the informant.
Jeong-Do Management Website
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