Climate Change Data

Environmental Metrics

ESG Focus Areas

• Economy
• Environment
• Employee
• Community

Environmental Achievements

• Replaced aging facilities for hazardous chemicals with continuous investment.
• Reduced pollutant and greenhouse gas emissions.
• Improved resource recycling.

Social Achievements

• Launched employee well-being program (Health Up program focusing on diabetes management).
• Improved employee satisfaction through various initiatives (housing fund loan increase, advanced building material benchmarking training).

Governance Achievements

• Improved risk reduction and work transparency through marketing department system reform.
• Implemented a Clean POSCO Steel System to prevent bribery and corruption.
• Established an ethics compliance program with employee self-assessment and risk identification.

Climate Goals & Targets

Environmental Challenges

• Weakening export markets due to intensified protectionist policies in various countries and the entry of new competitors.
• Increased global risks due to prolonged global economic recession, deepening low growth in the steel industry, and increased overseas expansion.

Mitigation Strategies

• Strengthened proactive management across all departments, resulting in exceeding the 2016 management plan by 75 billion won and achieving an operating profit of 39.5 billion won.
• Improved product and market differentiation through the development of high-corrosion-resistant products (SUPER ALCOSTA, MACOSTA) and high-grade color products.
• Improved financial structure by selling the Seoul office and securing funds for new growth investments.
• Enhanced internal competitiveness through organizational restructuring and workforce adjustments.

Supply Chain Management

Responsible Procurement

• Green procurement of environmentally friendly raw materials and MRO supplies.
• Support for the growth of SMEs through various programs (patent support, equipment support, purchase-conditional new product development).

Climate-Related Risks & Opportunities

Opportunities

• Development of energy-efficient products and technologies.

Reporting Standards

Frameworks Used: GRI G4.0, ISO 26000

Certifications: ISO 14001

Sustainable Products & Innovation

• SUPER ALCOSTA
• MACOSTA
• Cr-Free integrated pretreatment
• Various high-grade color products

Awards & Recognition

• Green Company designation by the Ministry of Environment (2013)
• Minister of Environment Award (2015)

Environmental Metrics

ESG Focus Areas

• Climate Change
• Environmental Management
• Eco-friendly Products and R&D
• Pollutant Management
• Resource Management
• Safe Workplace
• Health and Safety Management
• Customer Satisfaction
• Fair Trade
• ESG Management Risk Control
• Supply Chain ESG
• Human Rights
• Corporate Governance

Environmental Achievements

• Reduced greenhouse gas emissions (Scopes 1 & 2) to 114,417 tCO2e in 2023.
• Increased eco-friendly product sales to 27% of total sales.
• Green investments of KRW 310 million.
• Total waste recycling rate of 77.6%.
• Renewable energy usage of 224 GJ.
• Eco-friendly purchases of KRW 6.260 billion.

Social Achievements

• Employees’ volunteer service time of 3,986 hours.
• CSR investment of KRW 310 million.
• Partner company assessment rate of 100%.
• Awarded the 2023 Community CSR Certification.
• Awarded the Family-friendly Company Certification.

Governance Achievements

• Awarded the Minister of Strategy and Finance Prize at the 17th National Sustainable ESG Conference.
• Received a grade A in the ESG evaluation of the Korea Institute of Corporate Governance and Sustainability (KCGS) for four consecutive years.
• Changed the dividend base date at the 2023 general shareholders meeting.
• POSCO Group Fair Trade Index assessment of 87 points (Excellent).

Climate Goals & Targets

Environmental Challenges

• Deteriorating market conditions.
• Climate change risks (transition risks, physical risks such as extreme weather events like Typhoon Hinnamnor in 2022).
• Supply chain disruptions.
• Tightening safety regulations.
• ESG disclosure requirements.

Mitigation Strategies

• Strengthening core competitiveness by increasing sales of eco-friendly products.
• Developing energy-saving technologies.
• Completing due diligence on major suppliers.
• Developing a climate risk management model.
• Deploying a safety management system.
• Deploying the ESG Data Portal Application.
• Strengthening ESG system management by linking ESG core indicators with the management compensation system.

Supply Chain Management

Supplier Audits: 124 key domestic and overseas raw material suppliers in 2023

Responsible Procurement

• Code of Conduct for Suppliers
• Fair Trade Policy
• ESG assessment of suppliers
• Incentives for excellent ESG suppliers
• Training and consulting to strengthen ESG capabilities
• Preferential treatment for socially friendly companies
• Increase of green purchasing

Climate-Related Risks & Opportunities

Physical Risks

• Extreme weather events (typhoons, earthquakes, cold waves, heat waves)
• Increased average temperature
• Damage to facilities due to prolonged high temperatures
• Decreased labor productivity due to increased heat wave days
• Production losses due to increased incidence of natural disasters
• Worker safety risks and reduced productivity
• Increased energy consumption due to extreme weather conditions
• Increased volatility of raw material supply

Transition Risks

• Purchase of emission rights and renewable energy
• Regulation on GHG emissions
• CBAM and other new trade barriers
• Enhanced regulation on Green Washing
• Low-carbon products
• Eco-friendly processes and equipment
• Eco-friendly raw materials
• Growing demand for low-carbon products
• Rising new trade barriers related to environment
• Demand for information on generated carbon emissions by product
• Constant increase of stakeholders’ demands for sustainability
• Mandatory ESG disclosure
• Greenwashing

Opportunities

• Development of energy-efficient products
• Reduction of unit cost to enhance energy efficiency
• Generation of income from participation in the carbon market
• Increase of market share by expanding low-carbon product lines
• Competitive advantage through water saving and increased reuse of waste
• Enhancement of corporate image by leading the response
• Increase of new business lines, such as those for eco-friendly products

Reporting Standards

Frameworks Used: GRI Standards 2021, SASB Industry Standards, TCFD’s disclosure recommendations

Certifications: ISO 14001, K-OSHA MS, IATF 16949, ISO 9001

Third-party Assurance: Samil Accounting Corporation; Korean Standards Association (KSA)

UN Sustainable Development Goals

• Goal 3
• Goal 4
• Goal 5
• Goal 6
• Goal 7
• Goal 8
• Goal 9
• Goal 12
• Goal 13
• Goal 16

Various initiatives contributing to these goals are detailed throughout the report.

Sustainable Products & Innovation

• Recycle-Bio color steel sheet
• MACOSTA Zinc-Aluminum-Magnesium Alloy Plated Steel Sheet
• PBG/PBK Antibacterial Color Steel Sheet
• PosNC Non-Combustible Color Steel Sheet
• Print Printed color steel sheet
• Biomass color steel sheet

Awards & Recognition

• Presidential citation (model company chosen by Korea Statistics Service)
• Silver Industrial Medal
• 500 Million-Dollar Export Tower
• Award by Cultural Heritage Administration Commissioner
• Award by Deputy Prime Minister and Minister of Strategy & Finance at the 17th National Sustainable ESG Conference
• Sustainability Report Prize in the 2023 Korean Standards Association’s Sustainability Competition