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Four Principles for Fair Trade

In order to establish a fair subcontracting order between large and small businesses and to create a foundation for win-win cooperation, LX Houseys reflects the practice presented by the Fair Trade Commission in purchasing regulations and makes it a principle for fair trade.

a fair conclusion of a contract

Adjustment of delivery unit price based on reasonable unit price selection method

Selection and operation of fair partners

Ensuring objectivity and transparency in compliance with standards and procedures concerning registration and cancellation of partner companies

Prevention of unfair transactions

Installation and operation of internal review apparatus

Written issuance/preservation

Issue and preservation of seven written documents, including contracts and certificates of receipt of objects

Evaluation Process for CSR Risk Management

Step 1

Establish the CSR Code of Conduct for Suppliers

Step 2

Set the scope of supplier management

Step 3

Conduct CSR evaluation on suppliers

CSR Supplier Code of Conduct

The CSR Code of Conduct by LX Hausys is designed to present the requirements and standards that we expect our suppliers to participate in our social responsibility and efforts.

  • a. We prohibit the employment of children under the minimum legal working age, and concerning youth workers, comply with relevant regulations governing the minimum legal working age, work hours and work conditions
  • b. We prohibit forced labor, sweated labor and all other types of labor that go against the voluntary will of workers, and prepare labor contracts that clearly specify labor conditions.
  • c. We prohibit any type of discrimination on the grounds of race, skin color, age, gender, origin, disabilities, pregnancy, religion, political preference, labor union membership, and marriage status in such employment practices as recruitment, promotion, compensation, and educational opportunities.
  • d. We respect the dignity of workers, and create a work environment free from any inhumane treatment or threats ranging from sexual harassment, abuse, corporal punishment to psychological/physical coercion or verbal violence.
  • e. We abide by relevant legal criteria set forth concerning maximum work hours/days, minimum wage, welfare and benefits, labor hours and compensation
  • f. We acknowledge the freedom of association and the right to collective bargaining that are guaranteed by law, and create an environment where workers can communicate with the management on labor conditions without any fear on discrimination, retaliation, threat or harassment
  • g. We bear the responsibility to ban any type of corruptive practices such as bribe-taking (including receiving gifts) and embezzlement through corporate policy, and to constantly monitor and crack down on such practices. Furthermore, we guarantee the protection and confidentiality of whistle-blowers
  • h. We take legally-required actions to ensure that workers work and live (if residence is provided) in a safe and healthy environment, ranging from assessing and eliminating risk factors and offering continued training and emergency drills to providing personal protective equipment.
  • i. We do our utmost to obtain and update necessary environmental approvals and to minimize any negative impact of our manufacturing process – hazardous materials, waste and wastewater, air pollution and the use of resources - on the environment and local communities.

Supplier CSR Checklist Items

  • Safety and Health: safety and health management system, industrial safety, response to industrial accidents
  • Environmental Management: Environmental management system, hazardous chemical management, environmental pollutant management
  • Human and Labor Rights: Written labor contract, discrimination prevention, wages and working conditions, grievance handling 〮Other: Customer satisfaction management, ethics management, fair trade, data protection, contribution to local community.

Supplier CSR Risk Assessment Status

Supplier CSR Risk Assessment Status 1)

Unit 2017 2018 2019 2020
All new suppliers Number 101 207 117 169
New suppliers that have undergone CSR evaluaiton Rate(%) 100 100 100 100
Existing suppliers that have undergone CSR evaluation Number 400 340 340 340
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1) <p>Suppliers subject to evaluaiton</p> <ul> <li>New suppliers Evaluaiton of all new suppliers</li> <li>Exisiting suppliers from whom purchased items valued at KRW 100million in the previous year or suppliers whose items have strategic importance</li> </ul>

Results by Category of CSR Evaluation of Existing Suppliers in 2020 1)

Category Weight Score Percentile score
Ethics Management 15 12.44 82.92
Local Community 5 3.60 72.00
Safety & Health 25 21.7 86.80
Human & Labor Rights 30 27.37 91.24
Overall average 25 24.20 96.80
Media general 100 89.31 85.95
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1) )90% or higher : Low Risk / 80% or higher : Medium Risk / Below 80% : High Risk

Fair Trade Compliance Program

Main programs

Programs Content
Contents
  • Inspect key business and sites in order to monitor trade practices
Number of trainees (persons)
  • Raise employee awareness regarding fair trade and disseminate a culture of fair trade
  • Distribute fair trade manuals and training materials
  • Provide regular internal / external training
Number of trainees (persons)
  • Raise employee awareness regarding fair trade and disseminate a culture of fair trade
  • Distribute fair trade manuals and training materials
  • Provide regular internal / external training
Internal review of subcontract transactions
  • Distribute fair trade manuals and training materials
  • Provide regular internal / external training
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Fair Trade Compliance Training for Employees

Category 2017 2018 2019 2020
subcontracting Cartel and unfair trade subcontracting Cartel and unfair trade subcontracting Cartel and unfair trade subcontracting Cartel and unfair trade
Number of trainees(persons) 72 252 110 265 138 164 55 245
Number of training sessions 4 15 7 12 6 13 4 15
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