Governance Overview < Governance < Sustainability

Governance

Governance Overview

SK Innovation appoints directors with background in relevant industries based on the principle of independence, professionality and diversity. We will continue to pursue sustainable values for companies and the society based on BOD-driven management.

Establishing BOD-centered management system

Securing diversity and autonomy for a dynamic board to meet the needs of diversified stakeholders
We are enhancing the expertise and diversity of the board to meet the needs of diversified stakeholders. We intend to achieve board-centered management that strengthens the autonomy of the board of directors, including the chairman of the BOD and the chairman of each committee as Independent Directors.
Reinforcing the executive power of the board for ESG management
We are operating an ESG Committee under the board to lead/help/check the execution of company’s ESG policies and projects and are extending our Future Strategy Committee to plan the direction of future growth and manage performance.
Board-driven CEO evaluation and compensation
The HR Evaluation and Remuneration Committee participates in decision making regarding CEO evaluation, compensation, and succession and plays a role in discovering competent and certified CEOs that can contribute to increasing company value.
Upgrading the board evaluation and communication with stakeholders
We upgrade the board evaluation and compensation system every year upon the reinforced role of Independent Directors, and try to keep the trust of stakeholders by communicating with them, including shareholders, and expanding the channels.

Advancing the BOD-centered global compliance response system

Extending the actual function of the Audit and Corporate Compliance Committee
The Audit and Corporate Compliance Committee is pre-and post-managing the total risk as the company’s compliance and business risk control tower. The Internal Audit Office is directly under the audit committee so that the board can directly manage and supervise the auditing function.
Establishing a global compliance system
We established the compliance management system in accordance with global standards to establish and inspect the evaluation and program systems regarding various issues such as fair trade, anti-corruption, and industry security.

Reinforcing the autonomy of the board

Operating the Independent Directors Council
SK Innovation is operating the Independent Directors Council consisting of Independent Directors only, and this Council suggests Independent Directors’ initiative agendas, puts together their opinions on board’s agendas, discusses the operational method of the board, and shares main management issues.

Comparison with Governance Practices Code
Category	Adoption	Note
Enactment of employees' code of ethics	ㅇAdopted
Separation of CEO and Chairman of the Board of Directors	ㅇAdopted
Composition of the Board of Directors (a majority of Independent Directors)	ㅇAdopted	Independent Directors’ share of 75% (6 Independent Directors, 1 executive directors, 1 non-executive director)
Holding regular meetings of the Board of Directors	ㅇAdopted	At least once a month
Prior provision of information on the directors before holding a meeting of the Board of Directors	ㅇAdopted	Provision of descriptions about agendas five days in advance
Introduction of regulations on roles and operation procedures of the Board of Directors and sub-committees	ㅇAdopted	Bylaws of the Board of Directors, Charter for the HR Evaluation and Remuneration Committee, Audit and corporate compliance committee, Strategy·ESG Committee
Committee operation for the fair recommendation of director candidates	ㅇAdopted	Operation of HR Evaluation and Remuneration Committee
Establishment of committees under the Board of Directors	ㅇAdopted	- Establishment of legally mandated committees (Audit Committee, Nominating Committee), and one additional committee -Strategy·ESG Committee
Announcement of the Board of Directors' activities, attendance rate, and pros and cons about major agendas	ㅇAdopted
Subscription to liability insurance for directors at the company's expense	ㅇAdopted	Subscription of Directors & Officers Liability Insurance (annual renewal)
Operation of a meeting attended only by Independent Directors	ㅇAdopted	Operation of the Independent Directors Council
Evaluation of the Board of Directors' activities	ㅇAdopted
Composition of Audit and corporate compliance committee (all Independent Directors)	ㅇAdopted	Four Independent Directors (including a financial and accounting expert)
Audit Committee held at least once a quarter	ㅇAdopted
Independence of external auditors	ㅇAdopted	Review and approval of Audit Committee for external auditors
Verification of accuracy of business reports	ㅇAdopted	Verification by CEO and responsible employees

Comparison with Governance Practices Code