SupplierCSR
LG Chem encourages partners’ human rights management activities by establishing a code of conduct for partners and conducting CSR evaluation on them. Sustainability issues in the value chain around the world are directly or indirectly influencing businesses, and, as the number of their types increase, the importance of sustainability risk management grows as well. Accordingly, LG Chem has established and operated its supply chain management system in accordance with the standards required by international organizations such as UN and OECD and is in close communication with key stakeholders such as partners, customers, investors and NGOs.
Supply Chain Management Process

LG화학은 임직원과 모든 이해관계자들의 인권을 존중하며 경영활동 전반에서 인권존중의 책임을 실현하기 위해 노력하고 있습니다. 직접적인 영향이 미치는 회사 사업장의 경우 인권영향평가를 실시하여 인권 리스크를 진단하고 개선사항을 도출해내어 사업 운영에 반영하고 있습니다. 간접적이지만 회사의 사업에 큰 영향을 미치는 공급망의 경우 협력사 CSR 점검을 통해 인권영역의 리스크를 식별하고 평가에 반영하는 등 협력사 관리에 있어 중점 사항으로 관찰하고 있습니다.

  • Plan Suppliers’ Code of Conduct
  • Do CSR Evaluation of Suppliers
  • Check Analysis of Evaluation Results
  • Act Monitoring Improvements
Progress

  • 2016 Established the code of conduct for partners.
  • 2017 Established CSR management system for partners.
  • 2018 Conducted CSR evaluation and on-site inspection of partners - Korea and China
  • 2019 Expanded evaluation targets and regions (China, Poland, etc.)
Request Compliance with Partners’ Code of Conduct

LG Chem enacted the code of conduct for partners in 2016, which consists of 10 items such as human rights, labor, ethical management, Environment Safety, ethical purchasing, etc. that partners must comply with. In 2017, the company established a due diligence policy environment safetyto prohibit the use of raw materials acquired through unethical methods, including illegal and serious human rights violations (e.g., minerals procured from disputed areas), and to further strengthen the monitoring system for such raw materials. In particular, partners are obliged to agree to the code of conduct on a regular basis every year.

Conduct Partner CSR Evaluation

LG Chem has evaluated partners every year regarding whether they faithfully comply with the code of conduct, and, in conjunction with on-site inspections, LG Chem discovers necessary improvement tasks and monitors implementation results.

CSR evaluation of partners is carried out in conjunction with purchasing evaluation (evaluation upon new partner registration, periodic evaluation). In the case of evaluation upon new partner registration, 10 items are included in the CSR area for new Korean partners and reflected in company evaluation. Regular evaluations are conducted for raw material manufacturers (239 companies in 2018, 171 companies in the first half of 2019 and 50 companies in the second half of 2019), and the evaluation contains a total of 60 items including prohibition of child labor, protection of workers, working hours compliance, management of minerals in disputed areas, Environment, Health & Safety permit management, and risk prevention management.

In 2018, LG Chem conducted five CSR compliance inspections at five battery business partners located in Nanjing, China. In the future, the company plans to expand the inspection targets and regions to the global production bases such as Poland to minimize the supply chain CSR risk.

In 2018, LG Chem conducted five CSR compliance inspections at five battery business partners located in Nanjing, China. In the future, the company plans to expand the inspection targets and regions to the global production bases such as Poland to minimize the supply chain CSR risk.