Climate Change Data

Environmental Metrics

ESG Focus Areas

• Environmental Management
• Safety and Health
• Shared Growth
• Fair Trade
• Climate Change Response
• Corporate Governance
• Social Contribution

Environmental Achievements

• Recycled 41% of rainwater and wastewater.
• Reduced CO2 emissions per ton of steel (though specific numbers fluctuate year to year).
• Achieved a high recycling rate of byproducts (approximately 98.4%).
• Developed and applied technologies to reduce scattering dust, odors, and noise.
• Improved water treatment efficiency.

Social Achievements

• Launched various programs to support SMEs, including financial support, technical cooperation, and partnership enhancement.
• Implemented a Benefit Sharing System.
• Expanded cash payment targets to medium-sized companies.
• Improved employee satisfaction index.
• Reduced employee turnover rate.

Governance Achievements

• Improved corporate governance based on the “Corporate Governance Charter”.
• Implemented a Compliance Program (CP).
• Maintained long-term stable cash dividends.
• Improved credit ratings.

Climate Goals & Targets

Environmental Challenges

• Delayed recovery of domestic market conditions.
• Increased imports of steel products from emerging countries.
• Global protectionism.
• Trade risks (anti-dumping).
• Climate change related risks (extreme weather, supply chain disruptions).
• Water scarcity.

Mitigation Strategies

• Focusing on domestic market and high value-added products.
• Strengthening R&D capabilities.
• Promoting smart factory initiatives.
• Business restructuring.
• Developing alternative sourcing strategies.
• Increasing water recycling and developing replacement water sources.
• Actively participating in discussions aimed at building rational policies.

Supply Chain Management

Supplier Audits: 96 suppliers audited in 2015-2017

Responsible Procurement

• POSCO Group Supplier Code of Conduct
• SRM evaluation index
• Benefit Sharing System
• Cash payment for all purchases from SMEs and medium-sized companies.

Climate-Related Risks & Opportunities

Physical Risks

• Extreme weather events (heavy rainfall, heat wave, heavy snowfall, earthquake, cold wave).

Transition Risks

• Tightening carbon regulations.
• Emissions Trading Scheme.

Opportunities

• Development of energy-efficient products.
• New businesses such as renewable energy and carbon market.

Reporting Standards

Frameworks Used: GRI Standard, UN Global Compact

Certifications: ISO 14001, ISO 9001, IATF16949, OHSAS18001, ISO 50001

Third-party Assurance: Samil PwC

UN Sustainable Development Goals

• Goal 6 (Clean Water and Sanitation)
• Goal 7 (Affordable and Clean Energy)
• Goal 8 (Decent Work and Economic Growth)
• Goal 9 (Industry, Innovation, and Infrastructure)
• Goal 12 (Responsible Consumption and Production)
• Goal 13 (Climate Action)
• Goal 14 (Life Below Water)
• Goal 17 (Partnerships for the Goals)

POSCO's initiatives contribute to these goals through various environmental, social, and governance programs.

Sustainable Products & Innovation

• World Premium (WP) and WP+ products
• PosMACⓇ 3.0
• PosCable98
• Giga Steel
• PosART®
• Triton

Awards & Recognition

• Global 100 Most Sustainable Corporations
• Innovation of the Year (World Steel Association)
• Presidential Award for the Korea Knowledge Awards
• Most competitive steel company (WSD for eight consecutive years)
• National Federation of Fisheries Cooperative Welfare Awards

Environmental Metrics

ESG Focus Areas

• Climate change response
• Supply chain management
• Employee health & safety

Environmental Achievements

• Reduced GHG emissions per ton of steel produced by 9% from 2.2 tons on average between 2007 and 2009 to 2.0 tons by 2020.
• By-product recycling amounted to 98.3%
• Atmospheric emission intensity amounted to 1.78 kg/t-S, down by 40% from 2.96 kg/t-S in 2000.

Social Achievements

• Launched the ‘POSCO Youth Dream’ program, consisting of the youth AI and big data academy and the startup incubation school to nurture young talent and create jobs.
• Opened Mutually Beneficial Daycare Centers to care for the children of both POSCO Group and partner company employees.
• Donated KRW 5 billion to help curb the spread of COVID-19 and promote early recovery in Korea.

Governance Achievements

• Established the Corporate Citizenship Committee composed of ESG experts to discuss our Corporate Citizenship management philosophy and ESG guidelines.
• Created a dedicated ESG organization.
• Introduced electronic voting in March 2019.

Climate Goals & Targets

Environmental Challenges

• Sluggish global steel economy and tightening regulations.
• Global economic downturn aggravated by the COVID-19 pandemic.
• Continued overcapacity and delayed recovery in steel-consuming industries.

Mitigation Strategies

• Stringent cost controls, market-oriented technology innovation, company-wide quality innovation, new product development, proactive advancement into new markets.
• Focus on core areas such as LNG value chain and agro businesses.
• Scenario-based emergency response approach to flexibly operate production and sales.

Supply Chain Management

Supplier Audits: 316 suppliers audited since 2015

Responsible Procurement

• POSCO Group Supplier Code of Conduct
• Supplier Relationship Management (SRM) assessments
• Tech Credit Bureau (TCB) system
• Responsible Minerals Assurance Process (RMAP)

Climate-Related Risks & Opportunities

Physical Risks

• Heavy rainfalls, heat waves, tsunamis, droughts

Transition Risks

• Tightening GHG regulations, increased carbon expenses

Opportunities

• Development of energy-efficient products, green business opportunities

Reporting Standards

Frameworks Used: GRI Standards Core option, SASB industry-specific standards, TCFD recommendations, UN Global Compact

Certifications: ISO 14001, ISO 50001, IATF16949

Third-party Assurance: Ernst & Young Han Young

UN Sustainable Development Goals

• SDG 4
• SDG 8
• SDG 11
• SDG 3
• SDG 6
• SDG 12
• SDG 13
• SDG 15
• SDG 17

Various initiatives aligned with UN SDGs, including education, economic growth, sustainable cities, health, water, responsible consumption, climate action, life on land, and partnerships.

Sustainable Products & Innovation

• GIGA STEEL
• PosMAC
• Hyper NO
• PosMent

Awards & Recognition

• World’s Most Competitive Steelmaker (World Steel Dynamics, 10 consecutive years)
• Lighthouse Factory (World Economic Forum)
• Innovation of the Year Award (World Steel Association)

Environmental Metrics

ESG Focus Areas

• Carbon Neutrality
• Safety
• Supply Chain Management
• Human Rights

Environmental Achievements

• Reduced total air pollutant emissions by approximately 16% from the previous year (51.7 thousand tons in 2023)
• Achieved a by-product recycling rate of 98.6% in 2023
• Installed dust collector breathers on all eight blast furnaces, reducing pollutants by approximately 90%
• Reduced unit emissions for air pollutants to 1.49kg/t-S in 2023 (50% improvement from 2000)
• POSCO-Mexico’s ‘Oasis’ Project achieved unit water consumption reduction saving 1 billion KRW annually.
• Reduced GHG emissions and increased rice yields using fertilizer made from steel byproducts (reducing CO2 by 0.93 tons per ton of fertilizer and methane emissions by 14%)
• First Asian steelmaker to achieve ResponsibleSteel site certification (October 2022)

Social Achievements

• Launched ‘Iron Health’ self-directed health improvement brand, with participants achieving an average reduction of 3.5kg in body fat and successful smoking cessation.
• Operated the ‘Mindfulness Center,’ conducting 4,297 counseling sessions in 2023.
• Selected as the Best Company for Childbirth and Childcare Promotion by the Ministry of Employment and Labor in 2023.
• Implemented a bi-weekly four-day workweek to enhance employee creativity and job engagement.
• Improved workers' work uniform to enhance safety during night work.

Governance Achievements

• Established and operates the ESG Committee and the Audit Committee, each chaired by an outside director.
• Operates the Fair Trade Compliance Program (CP) since 2002, achieving an AA rating in the Fair Trade Commission CP Rating Evaluation for 2021-2023.
• Established a comprehensive human rights due diligence process.
• Operates a reporting center for unethical behavior and violations of human dignity.

Climate Goals & Targets

Environmental Challenges

• Domestic economic downturn and high-cost pricing structures due to rising global energy and raw material costs.
• Transition risks associated with carbon costs, tightening regulations on carbon emissions (CBAM), and increased demand for low-carbon steel.
• Physical risks from extreme temperature, drought, coastal flooding, and fluvial flooding.
• Reputational risks from greenwashing and inadequate issue management responses.
• Water shortage problems in Mexico and Gwangyang.

Mitigation Strategies

• Formulated the vision of ‘Better World with Green Steel’ and implemented three strategies: expedite carbon neutral process technologies, ensure safe work environment and sustainable supply chain, and emphasize corporate ethics.
• Accelerating new low-carbon investment projects, implementing an internal carbon pricing system, establishing a system for calculating carbon emissions per product unit, and strengthening disclosure system.
• Established and operates a comprehensive Business Continuity Plan (BCP).
• Formed a Greenwashing Review Committee.
• Engaging with stakeholders through ESG Non-Deal Roadshows (NDR), client invitation briefings, and community public hearings.
• Developing water recycling technology and establishing a collaboration-based shared growth model (POSCO-Mexico’s ‘Oasis’ Project).
• Operating seawater desalination facilities and reusing treated wastewater from sewage treatment facilities (Gwangyang).

Supply Chain Management

Supplier Audits: 50 on-site audits in 2023 (aiming for 500 cumulatively by 2030)

Responsible Procurement

• POSCO Supplier Code of Conduct aligned with UN Global Compact and RBA.
• ESG evaluation criteria integrated into annual supplier performance assessments.
• Responsible Minerals Policy and 5-Step Supply Chain Responsible Minerals Management process.

Climate-Related Risks & Opportunities

Physical Risks

• Extreme temperature
• Drought
• Coastal flooding
• Fluvial flooding

Transition Risks

• Regulatory tightening
• Expansion of low-carbon market and technology needs
• Reputational risk

Opportunities

• Growing demand for high-strength, high-efficiency products
• Growth of the electric vehicle (EV) market
• Demand for low-carbon steel products

Reporting Standards

Frameworks Used: GRI, SASB, TCFD, ISSB

Certifications: ISO 14001, ISO 50001, ResponsibleSteel

Third-party Assurance: Third-party verification (details not specified)

UN Sustainable Development Goals

• Goal 7 (Affordable and Clean Energy)
• Goal 9 (Industry, Innovation, and Infrastructure)
• Goal 12 (Responsible Consumption and Production)
• Goal 13 (Climate Action)
• Goal 8 (Decent Work and Economic Growth)
• Goal 11 (Sustainable Cities and Communities)
• Goal 17 (Partnerships for the Goals)

POSCO's initiatives contribute to these SDGs through various environmental, social, and governance programs.

Sustainable Products & Innovation

• INNOVILT (premium construction material)
• e Autopos (eco-friendly automotive steel)
• Greenable (products for renewable energy infrastructure)
• Giga Steel (ultra-high-strength steel)
• Hyper NO (high-efficiency electrical steel)

Awards & Recognition

• Sustainability Champion (World Steel Association, 2022-2024)
• 2023 Innovation Awards Eco-Innovator Category (worldsteel)
• 2023 Innovation Awards (BCCCC)
• Worldsteel Steelie Awards (October 2023)
• Environmental Innovation Category at the International Corporate Citizenship Conference (ICCC, 2023)
• Presidential Citation at the Korean Volunteer Awards (2023)