Climate Change Data

Environmental Metrics

ESG Focus Areas

• Sustainable Lifestyle
• Inclusive Growth
• Circular Economy
• Climate Change
• Responsible Consumption and Production
• Gender Equality

Environmental Achievements

• Reduced plastic packaging usage by 304.6 tonnes
• Reduced GHG emissions intensity (Amorepacific Group) by 3.3%
• Opened Korea’s first cosmetics industry refill station
• Achieved 5.0% renewable energy generation in 2020 (from 0.3% in 2015)
• Joined RE100 initiative, committing to 100% renewable energy by 2030
• Beauty Park Osan certified as a national-level eco-friendly plant
• Reduced water consumption intensity by 8.5% in Korea and 55.5% overseas (compared to 2015)
• Developed metal-zero pumps for improved recyclability
• Used FSC-certified paper for 100% of packaging materials
• Increased products using bioplastics and/or recycled plastics from 114 in 2017 to 242 in 2020
• Reduced water usage by 0.7L (10.9%) per LANEIGE Water Sleeping Mask EX product

Social Achievements

• Increased ratio of female managers to 35.3%
• Supported the health, well-being, and economic empowerment of 508,545 women (254% of the 20 by 20 Commitment goal)
• Launched Makeup Your Life campaign, improving self-esteem in 84% of participants
• 80% of suppliers were in the top-rated category for sustainability assessment
• Launched Let’s Walk donation campaign, donating 60 million KRW to animal welfare organizations
• Implemented We Care Health Program for employee mental and physical well-being
• Introduced hands-on VR education program for emergency safety
• Improved the rate of returned products due to impurities by 47% through supplier support

Governance Achievements

• Established ESG Committee within the Board of Directors
• Implemented a systematic risk management system
• Established policies and regulations for ethical management
• Conducted Group-wide ethical awareness surveys
• Implemented a transparent tax payment system

Climate Goals & Targets

Environmental Challenges

• COVID-19 pandemic impacting offline sales and business operations
• Increased global regulations on safety and environment
• Diversification of customer needs
• Increased possibility of major disasters and natural calamities
• Fluctuations in the supply environment of raw materials
• Changes in the distribution and sales environment due to the acceleration of digitalization
• Increased physical risks caused by climate change

Mitigation Strategies

• Strengthened e-commerce strategies and online business partnerships
• Digital transformation and expansion of O2O services
• Reinforced win-win programs with business partners
• Developed products with improved environmental impacts and established a lifecycle assessment system
• Established mid- to long-term strategies for climate change, expanding renewable energy and increasing energy use efficiency
• Securing the stability of supply and demand by monitoring changes in market prices of critical/natural raw materials

Supply Chain Management

Supplier Audits: 85 suppliers received a sustainability assessment in 2020; 40 received on-site inspections by an independent third party.

Responsible Procurement

• Supplier Sustainability Guidelines
• Mutual growth programs
• Joint R&D projects
• Financial support
• Technological innovation support
• Growth infrastructure support
• Education programs for suppliers

Climate-Related Risks & Opportunities

Physical Risks

• Extreme weather
• Natural disasters
• Supply chain disruptions

Transition Risks

• Increased global environmental regulations
• Changes in consumer demand

Opportunities

• Expansion of renewable energy
• Development of low-carbon products

Reporting Standards

Frameworks Used: GRI Standards, UN Global Compact, UN Sustainable Development Goals (SDGs), TCFD, SASB

Certifications: ISO 14064-1:2018 (GHG Protocol), Product Water Footprint (PWF) certification (LANEIGE), Product Carbon Footprint (PCF) certification (OSULLOC)

Third-party Assurance: DNV Business Assurance Korea Ltd.

UN Sustainable Development Goals

• SDG 5: Gender equality
• SDG 12: Responsible consumption and production
• SDG 13: Climate action

Various initiatives contribute to these goals through promoting women's health and economic empowerment, reducing environmental impact, and combating climate change.

Sustainable Products & Innovation

• Refill products
• Products with less plastic packaging
• Products with recycled and bio-based plastics
• Vegan-certified products
• Products with universal design

Awards & Recognition

• MSCI ESG Rating Class AA (APG)
• MSCI ESG Rating Class A (AP)
• DJSI Asia-Pacific Index
• DJSI Korea Index
• FTSE4Good Index
• CES 2021 Innovation Award

Environmental Metrics

ESG Focus Areas

• Environmental
• Social
• Governance

Environmental Achievements

• Joined RE100 initiative, becoming the first Korean beauty company to do so and replacing 18.5% of all worksites’ energy use with renewable energy in 2021.
• Obtained Green Technology Certification for ultra-high-pressure ginseng processing technology, reducing energy consumption by more than 10%.
• Primera Skin Relief UV Protector EX won Korea’s Green Product of the Year 2021 Award for its sustainable packaging.
• innisfree collected 1,105 tonnes of plastics and glass from 2011 to 2021, reducing 1,418 tonnes of CO2.
• Reduced the weight of plastics used in containers for 29 items, reducing plastics consumption by 110.1 tonnes.
• Applied recycled plastics or bioplastics to 3.9% of plastic packaging, reducing virgin plastics use by 464.8 tonnes.
• Opened refill stations at Amore Store Gwanggyo and innisfree Gangnam Flagship Store.
• Achieved an RSPO-certified palm oil use rate of 41.7%.

Social Achievements

• Invested 3.23 billion KRW to support the financial independence of socially vulnerable groups through various programs.
• Invested 3.03 billion KRW to support a healthy lives and culture initiative for citizens through Pink Run Plus, Pink Tour, and Makeup Your Life.
• Established a robust diversity and inclusion policy and developed educational programs for employees.
• Collaborated with Bloomwork, a social enterprise supporting disabled artists.
• Signed an agreement for win-win cooperation with Donggubat, a social enterprise employing people with developmental disabilities.
• Ran the MEET YOUR DREAM mentoring program for teenagers, with 4,194 teenagers receiving support.
• Donated 1 billion KRW for the Beautiful Life program supporting the economic independence of women.
• Conducted the Makeup Your Life makeup training program for cancer patients, reaching over 800 participants in 2021.
• Ran the Pink Run Plus campaign, raising 2.8 billion KRW for breast cancer patients.

Governance Achievements

• Launched the ESG Committee inside the Board of Directors as the highest decision-making body on sustainability.
• Updated business ethics and compliance guides to prevent unethical and compliance risks.
• Conducted Group-wide online education on business ethics, with a 92% completion rate.
• Investigated 100% of the 33 reports received through the Ethics Hotline, taking disciplinary actions in 13 cases.

Climate Goals & Targets

Environmental Challenges

• Challenging business conditions due to COVID-19 and internal and external uncertainties.
• Changes in the cosmetics market.
• Social distancing measures impacting offline sales.
• Global supply chain disruptions due to conflicts between countries.
• Increased export costs due to the adoption of carbon border tax by countries.
• Customer changes according to changes in the population structure.
• Waste management and recycling of cosmetic containers.
• Climate change risks (regulations, technology, products and services, reputation, physical risks).

Mitigation Strategies

• Strengthened business competitiveness through winning brands, digital transformation, and profit-driven restructuring.
• Improved business structure with a focus on strengthening online channels and offline store improvements.
• Introduced innovative and differentiated products and renewed key items.
• Strengthened collaboration with e-commerce platforms and focused on digital marketing.
• Monitored quantitative market indicators and secured price competitiveness by raising reserve inventory of raw materials.
• Diversified supply chain by raw materials.
• Developed technology to apply paper packaging to tube-type products, reducing plastic use by about 70%.
• Reduced the weight of plastics used in containers.
• Applied recycled plastics or bioplastics to packaging.
• Opened refill stations.
• Strengthened environmental assessment of products and joined the EcoBeautyScore Consortium.
• Developed highly functional innovative products for active senior consumers and accelerated research on customized cosmetics and health functional foods.
• Established a Carbon Neutrality Roadmap to achieve zero GHG emissions at all production sites by 2030.
• Implemented GHG emission reduction activities at each production site, reducing GHG emissions by 22.9% compared to 2018.

Supply Chain Management

Supplier Audits: 48 suppliers received on-site inspections by an independent third party (2021)

Responsible Procurement

• Supplier Sustainability Guidelines covering human rights and labor, safety and health, environmental protection, and ethical management.
• Mutual Growth Fund providing low-interest loans and financial support.
• Joint R&D projects with SMEs.

Climate-Related Risks & Opportunities

Physical Risks

• Increased uncertainty in the supply of raw/subsidiary materials due to extreme weather.
• Restrictions on the use of water-intensive products in countries with water stress.
• Reduced quality of raw/subsidiary materials and products due to sudden temperature changes.
• Production disruption due to increased extreme weather conditions.

Transition Risks

• Enhanced reporting obligations for GHG emissions.
• Increased product export risks and compliance costs due to stricter regulations.
• Changes in market demand and revenue due to consumer behavior changes.
• Cost increase for responding to climate-related regulations.

Opportunities

• Expanded renewable energy generation reduces cost exposure to rising fossil fuel prices.
• The production of recyclable products reduces EPR costs.
• Securing a competitive advantage in technology and quality based on changing consumer preferences.
• Establishing a low carbon production process.
• Increased consumption of low carbon and water-saving products.
• Reduced operating costs through the transition to eco-friendly logistics, transportation, and sales methods.
• Creating new market value by adapting to climate change.

Reporting Standards

Frameworks Used: GRI Standards, UN SDGs, TCFD, SASB

Certifications: ISO 14001

Third-party Assurance: DNV GL Business Assurance Korea Ltd.

UN Sustainable Development Goals

• Goal 7 (Affordable and clean energy)
• Goal 12 (Responsible consumption and production)
• Goal 13 (Climate action)

Initiatives contribute to these goals through renewable energy adoption, waste reduction, sustainable packaging, responsible sourcing, and community development programs.

Sustainable Products & Innovation

• Primera Skin Relief UV Protector EX
• LANEIGE Water Bank line
• Sulwhasoo Essential Comfort line
• Ryo Cheonsamhwa line
• LANEIGE Phyto-Alexin Ampoule
• CUBE ME Diet line products
• HAPPY BATH Essence Body Wash line products

Awards & Recognition

• Korea’s Green Products of the Year 2021 Award (Primera Skin Relief UV Protector EX)
• Innovation Award at CES 2022 (Mind-linked Bathbot and Myskin Recovery Platform)

Environmental Metrics

ESG Focus Areas

• Environmental impact of packaging materials
• Sustainable products and services
• Energy usage

Environmental Achievements

• Reduced virgin plastic use by 1,080 tons through recycled plastic and lightweighting.
• Shanghai production plant reached carbon neutrality (2021-2022).
• Amore Beauty Park obtained UL Solutions’ Silver designation for Zero Waste Classification.
• Daily Beauty Plant and COSVISION Plant acquired UL Solutions’ Platinum designation for Zero Waste Classification.
• Converted 34.1% of Amorepacific’s electricity consumption to renewable energy.

Social Achievements

• Invested KRW 7.9 billion to support financial independence of socially vulnerable groups.
• Invested KRW 770 million to promote citizens’ healthy living and cultural dissemination.
• 11.6% of all employees completed diversity & inclusion education and awareness improvement programs.
• Launched ‘makeup your Life’, a beauty therapy program targeting cancer patients.

Governance Achievements

• Average attendance rate at Board of Directors meetings was 97%.
• Expanded stock dividend payout ratio to 34.9%.
• Rate of completing company-wide ethics education program was 86.6%.

Climate Goals & Targets

Environmental Challenges

• Stricter regulations on packaging materials and waste management globally.
• Changes in market demand and revenue due to changes in consumer behavior.
• Increased uncertainty in the supply of raw/subsidiary materials due to extreme weather conditions.
• Negative views and evaluations from stakeholders (including NGOs).
• Potential risks related to carbon border tax.

Mitigation Strategies

• Increased proportion of environmentally friendly packaging materials and enhanced recyclability of plastic packaging.
• Improved environmental impact of products through sustainable resources and measuring carbon emissions and water usage.
• Expanded eco-friendly activities and sincere communication with customers.
• Strengthened environmental assessment for products, measured environmental footprint, and developed low-carbon technologies.
• Increased reserve inventory levels for raw materials and diversified supply chain.

Supply Chain Management

Supplier Audits: 119 suppliers received sustainability assessments in the last three years.

Responsible Procurement

• Supplier Sustainability Guidelines; Code of Ethics; Beautiful Purchases Agreement; support for suppliers to strengthen sustainability; low-interest rate loan funds; mutual growth payment system.

Climate-Related Risks & Opportunities

Physical Risks

• Reduced quality of raw/subsidiary materials and products due to sudden temperature changes
• Production disruption due to increased incidence of extreme weather conditions
• Increased repair costs due to facility damage

Transition Risks

• Strengthened reporting obligations for GHG emissions
• Increased product export risks and compliance costs due to stricter regulations
• Increased costs for responding to climate-related regulations

Opportunities

• Decreased cost exposure associated with the rising fossil fuel prices, through the expansion of renewable energy generation
• Reduced EPR costs through the development of recyclable products
• Increased consumption of low carbon and water-saving products

Reporting Standards

Frameworks Used: GRI Standards (2021), SASB Standards for Household & Personal Products industry

Certifications: ISO 14001, ISO 45001

Third-party Assurance: BSI

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• LABO’H paper-type refill pouch; LANEIGE Water Bank Blue Hyaluronic line; Mamonde Rosewater Toner-Clean Version; Hera Skin Radiant Glow Cushion; Innisfree Blueberry Rebalancing Skin; Innisfree Collagen Peptide Firming Ampoule Cream; HANYUL Yuja Sleeping Mask; ETUDE Soonjung Director’s Sun Cream; HAPPY BATH Original Collection Body Wash and Lotion; AMOS Professional Green Flair; VITAL BEAUTIE Red Ginseng Extract and Deer Velvet Ampoule; VITAL BEAUTIE Super Collagen Essence Biotin; COSMECHIP customized skincare cosmetics manufacturing device; CUSTOM.ME Bespoke Essence.

Awards & Recognition

• 2022 Monde Selection (Vital Beautie); Korea’s Green Product of the Year (Vital Beautie); Bucheon City Mayor Prize at the Korea Star Awards (Amorepacific); CES 2023 Home Appliance Innovation Award (COSMECHIP); CES 2023 Innovation Award in Robotics (Authentic Color Master by TONEWORK).

Environmental Metrics

ESG Focus Areas

• Climate Change and Energy Management
• Environmental Impact of Packaging Materials
• Biodiversity Conservation
• Supplier ESG
• Water Usage
• Sustainable Products and Services
• Waste Recycling
• Industrial Safety
• Healthy Governance Structure
• Hazardous Chemicals
• Anti-Corruption prevention

Environmental Achievements

• Reduced the use of virgin plastic by 1,900 tonnes.
• Converted 51.4% of Amorepacific's electricity usage to renewable energy.
• Achieved zero landfill disposal of waste at global production sites.
• 23.8% of total plastic used consisted of recycled or bio-based plastic.
• 91.5% of the total 16,797 tonnes of palm-derived ingredients used in 2023 was RSPO-certified palm oil.

Social Achievements

• 46.7% of all domestic employees completed diversity & inclusion education.
• Investment of KRW 5.07 billion to support financial independence (Cumulative total of KRW 15.08 billion).
• Investment of KRW 1.57 billion to promote citizens’ healthy living and cultural dissemination (Cumulative total of KRW 5.37 billion).

Governance Achievements

• Established an ESG Committee under the Board of Directors.
• Obtained ISO 37001 certification in May 2023 for anti-corruption management.
• Achieved 100% average attendance rate for board meetings.

Climate Goals & Targets

Environmental Challenges

• Increased regulatory cost burden due to greenhouse gas regulations and carbon taxes.
• Increased cost burden due to the expansion of the disclosure scope and strengthening of standards for climate change response.
• Increased compliance costs due to strengthening environmental regulations on product packaging.
• Litigation or legal sanctions from civil society and local community stakeholders.
• Increased R&D cost burden to respond to the demand for low-carbon/eco-friendly products.
• Loss of sales opportunities due to failure to respond to consumer demand for eco-friendly products.
• Increased procurement costs due to the rising demand for raw materials with eco-friendly certification.
• Rise in raw material procurement costs from key supply chain due to carbon regulations.
• Increase in electricity cost due to the passed-on from decarbonization and energy transition in the power sector.
• Products being sold or business operations being stigmatized as environmentally destructive.
• Decline in corporate value due to poor evaluation of climate action.
• Business interruption and asset damage due to river flooding, torrential rains, increased typhoons.
• Decrease in productivity due to worsening drought.
• Cessation of plant operations and increase in water usage costs due to intensifying water shortages.
• Decrease in productivity and increase in cooling costs due to the rise in the number of extremely hot days.
• Business interruption and asset loss due to coastal flooding resulting from rising sea levels.
• Business interruption and asset loss due to an increase in the frequency of wildfires.

Mitigation Strategies

• Achieving RE100 across all global business sites by 2025.
• Minimizing exposure to rising electricity prices and volatility risks through the expansion of on-site solar power generation and securing long-term fixed pricing through Power Purchase Agreements (PPAs).
• Establishing a foundation for responding to the demands of leading global distribution channels and customer needs by enhancing the standards for eco-friendly products.
• Continuously implementing the 4R strategy to mitigate costs associated with the strengthening of packaging regulations.
• Enhancing monitoring of extreme weather disaster risks and pushing for the improvement and reinforcement of HVAC and disaster prevention infrastructures.
• Realizing market opportunities for climate-adaptive products by strengthening the competitiveness of functional products.
• Investing in energy efficiency and optimization of HVAC systems.
• Enhancing the monitoring of weather risks for regions where our main business sites are located.
• Progressively diagnosing the level of response infrastructure in the face of intensified extreme rainfall conditions and reinforcing disaster prevention infrastructure.

Supply Chain Management

Supplier Audits: Annual sustainability assessment of suppliers.

Responsible Procurement

• Sustainability Management Guidelines for Amorepacific suppliers.
• Code of Conduct.
• Supplier sustainability requirements.

Climate-Related Risks & Opportunities

Physical Risks

• Flooding due to heavy rainfall
• Floods caused by river overflows
• Wind and water damage caused by typhoons
• Increase in abnormal high temperature phenomena
• Water scarcity and an increase in wildfires
• Coastal flooding due to rising sea levels

Transition Risks

• Increased regulatory cost burden due to greenhouse gas regulations and carbon taxes
• Increase in cost burden due to the expansion of the disclosure scope and strengthening of standards for climate change response
• Increase in compliance costs due to strengthening environmental regulations on product packaging
• Increased R&D cost burden to respond to the demand for low-carbon/eco-friendly products
• Loss of sales opportunities due to failure to respond to consumer demand for eco-friendly products
• Increased procurement costs due to the rising demand for raw materials with eco-friendly certification
• Rise in raw material procurement costs from key supply chain due to carbon regulations
• Increase in electricity cost due to the passed-on from decarbonization and energy transition in the power sector
• Products being sold or business operations being stigmatized as environmentally destructive
• Decline in corporate value due to poor evaluation of climate action

Opportunities

• Cost reduction through energy efficiency and increased recycling in the manufacturing stage
• Reduction of water costs through increased water efficiency in manufacturing facilities
• Reduction of energy costs through the transition to renewable electricity
• Reduction of energy costs through the transition from internal combustion engine vehicles to electric vehicles
• Utilization of energy-related policy subsidies and financial support incentives
• Increased sales opportunities through the development of low-carbon/environmentally friendly products
• Increased sales opportunities through the development of new climate change adaptive products
• Creation of new business revenue through the development of eco-friendly packaging materials and technology
• Reduction in funding costs through the utilization of sustainable green financial products
• Increased sales opportunities through leveraging incentives from mandatory eco-friendly product purchase policies
• Mitigation of electricity cost volatility through the Power Purchase Agreement (PPA) of renewable electricity

Reporting Standards

Frameworks Used: GRI Standards, SASB Standards for the Household & Personal Products industry, TCFD, UNGC

Certifications: ISO 14001, ISO 45001, ISO 37001

Third-party Assurance: Samil PwC

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Products with recycled plastics
• Vegan-certified products
• Refill products
• Eco-friendly products

Awards & Recognition

• RE100 Leadership Award
• Minister of Environment Award on Resource Circulation Day
• CES Innovation Award (five consecutive years)
• Minister of Employment and Labor Award