GovernanceHolding Company has embraced a corporate governance system
Governance PhilosophyIn order to protect shareholders' entitlements and increase the transparency and proficiency of management,
The Board of Directors was formed to provide guidance and deliberate on important company agendas, items stipulated by law or in the Articles of Incorporation, details entrusted by general meetings of shareholders, the basic policies of business operations and on essential practices related to business management. The Board of Hankook Technology Group also oversees the execution of directors' duties and abides by Korean Commercial Law, which mandates that businesses with over two trillion won must possess a Board of Directors wherein half are non-executive directors.
The Board also operates four committees—the Audit, NED Nomination, Management and Internal Transactions Committees. The Articles of Incorporation allows for the creation of additional committees as deemed necessary.
Mr. Cho is the Vice Chairman and CEO of Hankook Technology Group, a position he has held since 2012. He joined the company in 1997 and has held various positions including Director of Marketing and Korea Regional Headquarters. He earned his Bachelor's degree in Economics from Syracuse University.
Hyun-Beom Cho, COO of Hankook Technology Group and President of Hankook Tire, joined the company in 1998 and has held various positions, including the Marketing Communications Division head. Mr. Cho is majored in Economics and graduated from Boston College.
※ 3-year term as an elected executive director or non-executive director
|No.#||Agenda||Approved Or Not||Name of NED|
|Cho, Yang Rae||Cho, Hyun Shick||Min, Hae Young||Lee, Yong Sung||Kim, Soon Kee||Jeon, Byung Jun||Kim, Han Kyu|
|Agree or Disagree|
|FY2017 4Q consolidated results report||Approved||Agreed||Agreed||Agreed||Agreed||Agreed||N/A||N/A|
|FY2017 separate, consolidated financial statements approval||Approved||Absent||Agreed||Agreed||Agreed||Agreed|
|Decision of the FY2017 (64th business year) cash dividend||Approved||Absent||Agreed||Agreed||Agreed||Agreed|
|FY2017 Financial Statement Approval||Approved||Absent||Agreed||Agreed||Agreed||Agreed|
|Decision to convene the General Shareholders' Meeting||Approved||Absent||Agreed||Agreed||Agreed||Agreed|
|Decision of the General Shareholders' Meeting agenda items||Approved||Absent||Agreed||Agreed||Agreed||Agreed|
|Internal accounting management system operation status report||Approved||Absent||Agreed||Agreed||Agreed||Agreed|
|Appointment of Internal Accounting Control Officer||Approved||Absent||Agreed||Agreed||Agreed||Agreed|
|Appointment of the Internal Transactions Committee member||Approved||Absent||Agreed||N/A||N/A||Agreed||Agreed||Agreed|
|Appointment of the NED Recommendation Committee member||Approved||Absent||Agreed||Agreed||Agreed||Agreed|
|FY2018 1Q consolidated results report||Approved||Absent||Agreed||Agreed||Agreed||Agreed|
|FY2018 1H consolidated results report
|FY2018 3Q consolidated results report||Approved||Absent||Agreed||Agreed||Agreed||Agreed|
※ The following change has been made to the directors in the general shareholders' meeting on March 26, 2018.
(External Director Hae-Young Min resigned and Yong-Sung Lee newly appointed as an External Director)
(External Director Byeong-Joon Jeon resigned and Han-Kyu Kim newly appointed as an External Director)
Hankook Technology Group Audit Committee consists of three members, all of whom are outside directors (NED).
In order to facilitate the access to operational information needed for auditing by the Audit Committee, Hankook Tire has established "Audit Committee Operation Regulations," as its internal regulation; by specifying the permission to request the directors at any time for reports regarding the operations, or to investigate the company's financial status, it provides the basis for such activities.
※ 3 year term based on the appointed date
The Audit Committee is comprised of the Regular Committee and the Temporary Committee, where the Regular Committee shall convene once every quarter. However, the chairperson reserves the right to postpone or suspend the meeting due to unavoidable circumstances. In this case, the Temporary Committee convenes as necessary.
The Committee is assembled by the chairperson. Each member reserves the right to demand assembly of the Committee by presenting the reason for such to the chairperson. If the chairperson chooses not to assemble the Committee without fair reason, the member who demanded the assembly may convene the meeting by him or herself.
In assembling the Committee, the date of the meeting is decided with notifications sent to each member one week before the date. However, upon agreement by all members, a meeting can be convened at an agreed time.
Resolutions of the Committee are made through the attendance of at least half of the members. However, members can permit participation in resolutions without direct attendance through such means as video conferencing. In such cases, the member(s) concerned is considered to have directly attended the meeting.
Matters to be referenced by the Committee are as include:
Members may demand the attendance of management, related staff and the external auditor in any meeting where such attendance is considered necessary for work execution. And in the case where such attendance is recognized as necessary, members may request advice from outside experts, in which the expenses will be covered by the company.
Meeting minutes are recorded at each Committee meeting. They include the agenda, issues discussed, results, individual opposing and the reasons for the opposition. The members attending the meeting seal or sign the minutes.
|No.#||Agenda||Approved Or Not||Name of NED|
|Min, Hae Young||Lee, Yong Sung||Kim, Soon Kee||Jeon, Byung Jun||Kim, Han Kyu|
|Agree or Disagree|
|FY2017 consolidated profit 4th-quarter results report||Approved||Agreed||Agreed||Agreed||N/A||N/A|
|Internal accounting control system operation status report||Approved||Agreed||Agreed||Agreed|
|FY2017 financial statements approval||Approved||Agreed||Agreed||Agreed|
|Review of the General Shareholders' Meeting agenda items||Approved||Agreed||Agreed||Agreed|
|Appointment of the Chairman of Audit Committee||Approved||N/A||N/A||Agreed||Agreed||Agreed|
|FY2018 Consolidated Profit 1st-Quarter Results Report||Approved||Agreed||Agreed||Agreed|
|FY2018 Report on Audit Plans and Key Audit Matters||Approved||Agreed||Agreed||N/A|
|FY2018 Consolidated Profit 1st-Half Results Report||Approved||N/A||Agreed||Agreed|
|FY2018 Report on Selecting Key Audit Matters||Approved||N/A||Agreed||Agreed|
|FY2018 Consolidated Profit 3rd-Quarter Results Report||Approved||Agreed||Agreed||Agreed|
|Selection of external auditor||Approved||Agreed||Agreed||Agreed|
As a corporation with over KRW 2 trillion won in assets, Hankook Technology Group is required by Clause 8 of 2 of Article 542 to set up a Non-executive Director (NED) Nomination Committee to recommend non-executive director candidates.
Hankook Technology Group's External Director Candidate Recommendation Committee consists of Soon-Ki Kim (Chairman), Byeong-Joon Jeon, Han-Kyu Kim, Hyun-Shick Cho and Hyun-Beom Cho; the External Directors are Soon-Ki Kim, Byeong-Joon Jeon and Han-Kyu Kim.
The Committee has the right to recommend non-executive director candidates during the general assembly of shareholders. In deciding on non-executive director candidates, the Committee must include candidates proposed by shareholders who exercise their right for Nomination as stated in Clause 1 of 2 of Article 363 and Clause 1 and 2 of 6 of Article 542 of the Commercial Law.
Committee members may be appointed and dismissed by the Board of Directors, where the Committee must be comprised of two or more directors, and more than half of the total members shall be non-executive directors.
The chairperson represents the Committee and acts as chair during Committee meetings. When the chairperson can no longer fulfill his or her duties due to unforeseen circumstances, a member of the Committee will be selected by the Committee and act as his or her proxy.
The Non-executive Director (NED) Recommendation Committee is summoned by the chairperson. However, in cases where the chairperson cannot fulfill his duty due to an unforeseen situation, his or her proxy may convene meetings.
Each Committee member may request the convening of a Committee meeting by providing a motion and reason to the chairperson. In cases where the chairperson chooses not to convene the Committee without fair reason, the member who requested the meeting can convene the Committee by him or herself.
In summoning the Committee, each member of the Committee must be notified at least one week prior to the meeting date.
Resolutions of the Committee are made through the attendance of over half of current members and by more than half of those members in attendance. The Committee can also pass resolutions without all or part of members directly attending through teleconferencing.
The Committee is responsible for recommendation of external director candidates and other matters in relation to the nomination of external director candidates.
The Committee reserves the right to request the attendance of management, staff or external figures to a meeting if their presence is deemed necessary for effective proceedings, and the Committee must notify each director of matters resolved within two days.
Minutes are recorded for all meetings of the Committee, and should include all proposals and their details and members who have attended should sign or place their seal in the minutes book.
A Human Resources officer shall be appointed as a secretary who shall be in charge of the Committee's affairs under the direction of the Chairperson.
The Management Committee is composed of directors within the company, led by Cho, Hyun Shick, Vice Chairman and CEO at Hankook Technology Group.
Through the authority of the Board of Directors to delegate, the Committee may deliberate on and resolve matters other than the following:
The Committee may deliberate on matters that require review prior to being referred to the Board of Directors, and may deliberate on and resolve risk management issues and any other daily management-related issues.
Members of the Committee are elected and dismissed by the Board of Directors, and the Committee is composed of at least two directors elected by the Board of Directors.
The Chairperson of Management Committee represents the Committee and acts as the Chairperson of a Committee Meeting. If the Chairperson of the Committee is absent or unable to perform his or her duties, a member shall be appointed by the Committee to vicariously his or her duties.
Meetings are classified as either ordinary meetings or extraordinary meetings. Ordinary meetings in principle are held on the third or fourth Monday of every month; however, if there are unavoidable circumstances, an ordinary meeting may be rescheduled to another date with prior notice. Extraordinary meetings are held when required.
The chairman of the Management Committee can convene Committee meetings. If the chairman of the Committee does not convene a meeting with a lack of reasonable grounds, the member who made the request may convene a meeting of the Committee in any case.
When a Managment Committee meeting is to be convened, the date of meeting may be specified and a notice must be sent to each member of the Committee one (1) week prior to the date of the meeting. If all Committee members have consented, meetings may be held at any time without following the procedure in Section 1.
Resolutions of the Committee shall be made by a majority of members in attendance, and with a majority affirmative vote by those members. The Committee may allow all members, or a part thereof, to participate in resolutions of the Committee by video conference in lieu of attending the meeting in person. In such case, those member(s) may be deemed to have attended the meeting in person.
Where the Committee finds it necessary to perform its duties, it may summon related officers, employees, and third parties to attend a meeting to hear the opinions of Committee members. Minutes shall be executed for all meetings of the Committee and must include the meeting agenda, proceedings, resolutions, persons in opposition to the resolutions, and the grounds for their objection. Members in attendance shall place their names and seals, or sign their names, in the Minutes. The details of resolutions made by the Committee must be reported to the Board of Directors within five days.
Each director who has received a notice on the matters resolved by the Committee may request the chairman of the Board of Directors to convene a meeting of the Board of Directors within two (2) days from the date when the director has received the notice, and the Board of Directors may resolve the issue made by the Committee again. If a director does not request a meeting of the Board of Directors within the period set forth, after the director has received a notice of resolutions of the Committee, the resolutions of the Committee may not be resolved again by the Board of Directors.
The Department Director of the Corporate Management Department acts as the secretary, which shall be responsible for the general affairs of the Committee according to the directions of the chairman of the Committee.
The Internal Transactions Committee is entrusted by the Board of Directors with the right of approval regarding large-scale internal transactions based on Clause 2 of Article 393 of the Commercial Law, Article 43 of the Articles of Association, and Clause 1, Article 11 of the Regulations for the Operation of the Board of Directors to ensure transparency and fair transactions. All matters related to the Committee are decided in accordance with these regulations with the exception of regulations set forth by law, the Articles of Association of the regulations of the Board of Directors.
Hankook Technology Group's Internal Transaction Committee includes Kim, Soon Kee (Chairman of Committee), Jeon, Byung Jun and Kim, Han Kyu.
The Internal Transaction Committee is re-appointed after the annual Ordinary General Meeting of Shareholders. The Committee members shall serve a term of one (1) year. However, in the event of any interim vacancy in the Committee, the remaining term of the predecessor(s) will be assumed.
The Internal Transactions Committee has as its counterpart individuals who specialize in laws governing monopoly regulations and fair transactions. It also has the authority to evaluate and approve transactions pertaining to any of the items listed below, and transactions amounting to 5 billion won or more. It is also responsible for evaluating and approving intentions to change other major details of the transactions.
When the Committee has granted approval according to these regulations, notification of all details is provided to each director. Directors who have been notified can request an assembly of the Board of Directors, and can seek reconsiderations of matters resolved by the Committee.
When evaluation and approval of an agenda is required, the Committee can request relevant company records, including the main details of the related transactions, method of agreements and standards for selection of transaction counterparts.
Members of the Committee is appointed through a resolution of over half of the members of the Board of Directors. The same procedure shall be applied in the case of dismissals.
Comprised of three or more external directors, the Committee is reorganized annually after the convening of the regular general assembly of shareholders. The term of members of the Committee is one year. In case of recruitment for unexpected vacancies, recruited individuals may fulfill the remaining term of the individual replaced.
The Chairperson of the Internal Transaction Committee shall serve a term of one (1) year. If the Chairperson of the Committee is absent or unable to perform his or her duties, a member shall be appointed by the Committee to vicariously his or her duties.
The Committee may be summoned by the chairperson, whereas each member of the Committee has the right to request assembly of the Committee by stating a motion and reason for such to the chairperson. If the chairperson chooses not to assemble the Committee for over one week without providing a fair reason, the member of the Committee who requested the assembly may convene the meeting by him or herself.
When convening the Committee, the date of the meeting may be decided and notifications made to each member at least seven days prior to the meeting date. When there is agreement among all members of the Committee, the Committee may omit the assembly procedures.
Resolutions relating to the internal transactions of the Committee is made by agreement of over half of the current members of the Committee. Regarding other matters, resolutions may be made if over half of the current members of the Committee are in attendance and if over half of those in attendance agree. If not enough members of the Committee can attend, resolutions can be made through teleconference.
If necessary, the Committee reserves the right to request the attendance of related management, employees or external individuals to meetings when their presence is required for effective proceedings. Minutes may be recorded for all meetings of the Committee, and should include the meeting agenda, procedures and results of the meeting. Any opposition by individuals may be put in writing, and members of the Committee who attended need to sign or place their seal in the minutes book.
When the company concludes an agreement which has a material impact on the company's profits, including large-scale contracts with other affiliated companies where the monetary amount of the transaction is 5 billion won or more, detailed records related to the transaction is to be preserved for a minimum of three years from when the contract takes effect.
This employee Code of Ethics (the "Code") is intended to set forth, and govern, the ethical conduct of all individuals employed by Hankook Technology Group's (the "Company"). Its purpose is to ensure that the company and those acting on its behalf conduct business according to our values and all company policies.
This Code of Ethics applies to all members of Hankook Technology Group's, as well as to directors, shareholders including vendors those who are in relation with the Company.
Employees shall aim to be free of accidents at work by strictly abiding by all safety regulations and guidelines. Employees are encouraged to be positive both in their thoughts and actions, and to help maintain a cheerful and liberal work environment.
In cases where employees are aware that their actions or the actions of others have violated ethical standards, employees shall report that fact to Audit Team.
Whistleblower shall not receive any retaliatory action of any kind; identity of the person shall be kept anonymous and protected.
The purpose is to provide judgmental and behavioral guidelines for the application of the Hankook Technology Group's Code of Ethics to actual cases; the company has set out ethical behavioral guidelines for its employee. The guidelines define the specifications regarding unlawful enticement or inducement.
|Inducement||Cash, checks, gift certificates, tickets, gifts||Forbidden (You are obliged to report the returning of items in excess of the given limits.)|
|Investments||Movable or immovable property, business rights, memberships, equities||Prohibited|
|Surrogate payment of liabilities||Credit card bills, bills, loans|
|Cash transaction||Borrowing money|
|Bargain goods||Making a profit by purchasing goods at bargain value|
|Notice of personal events||Invitations (e.g., wedding, funeral, etc) sent indiscriminately to business partners or to vendors in any form.|
Any item received that exceeds nominal value of one hundred ($100) US dollars shall be reported according to the procedures listed below and to be returned or disposed. However, when received items are less than $100 USD shall be returned without filing a report.
The conventionally accepted give and take of items as provided below are within the generally accepted limit and shall not be considered enticements:
Any unwillingly received inducement shall be dealt with according to the following procedures:
|Category||Prohibited Establishments (Extravagant and Lavish
Establishments) on behalf of the Company
|Drinking||Hostess Bar, Lounge/Bar, Clubs|
*These are prohibited for all employees of Hankook Technology Group's when in fact acting on behalf of the Company.
|Business trips paid by an outside party||Train, airline, bus tickets or accommodation for visits to a stakeholder's business premises or business trips together||Expenses must be paid back in full from Hankook Technology Group's|
|Vacation expenses paid for by an outside party||Train, airline, bus tickets, car expenses or accommodation for personal purposes||Prohibited|
|Guarantee of future employment from an outside party||Guarantee of employment, placement plan or entering into an agreement for other benefits, professionally and/or personally|
|Co-signing of loans||Co-signing a loan|
|Loans||Lending or providing assets as collateral for loans|
The purpose of these guidelines is to encourage members' proper social media use and prevent damage to the company's reputation caused by improper use of social media by employees.
Employees shall not infringe copyright, trademark, publicity right, or other relevant property rights owned by other organization(s) and individual(s).
Employees shall neither use the company's Corporate Image (CI) — such as the company logo or other related branded images — for personal use, nor violate Hankook Technology Group's official CI guidelines for business use.
Employees should be aware that Hankook Technology Group's Code of Ethics and any other policies, contained herein are applied to use of online and social media platforms.
These guidelines shall come into effect from July 1, 2014.
These guidelines attempt to protect and support whistleblowers of misconduct within the Company to prevent improper practices and to improve work processes by defining necessary matters for operating a whistleblowing system such as receiving and processing disclosures, protecting and rewarding whistleblowers.
These guidelines are applied to employees of the Company and all persons concerned and outsiders including subcontractors having transaction relationships with the Company.
The terms used in these guidelines are stipulated as such:
If a disclosure is found to be any of the following, the Audit Team may cease all proceedings and close the disclosure case without an investigation.
In the following circumstances, the reward shall not be provided:
If the individual eligible for rewards is discovered to be ineligible for rewards after the reward or exemption is granted, the reward may be redeemed and the exemption may be cancelled.
These guidelines shall become effective on July 1, 2015.