2014-2015 Sustainability Report, LG Electronics Adopted the G4 Guidelines of the Global Reporting Initiative (GRI)

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2014-2015 Sustainability Report, LG Electronics Adopted the G4 Guidelines of the Global Reporting Initiative (GRI) life’s GOOD WITH “Life’s Good with LG” is the official CSR slogan of LG Electronics and conveys our earnest desire for comprehensive communication with stakeholders about our CSR efforts in a variety of areas. LG 2014-2015 LG ELG전자lectronics 지속가능경영보고서 Sustainability Report 2014-2015 LG ELECTRONICS SUSTAINABILITY REPORT REPORT OVERVIEW LIFE’s Good with LG REPORT OVERVIEW In preparing our 2014-2015 Sustainability Report, LG Electronics adopted the G4 guidelines of the Global Reporting Initiative (GRI). As part of the new process for implementing the latest edition of the guidelines, we reviewed the previous year’s edition and best practice cases from corporations at home and abroad against the latest indices to identify the aspects that are lacking in our report. In order to address these aspects and prepare a more comprehensive and insightful report, we had extensive communication with business departments, focusing primarily on our strengths and weaknesses. We also reached out to our internal and ex- ternal stakeholders through a wide range of communication programs to seek their opinions, and performed a materiality analysis to identify the information that is considered material to stakeholders as well as to LG Electronics. Based on the findings, we tried to introduce information concerning “Material Aspects” as defined by the G4 guidelines. Externally, we worked with a third party assurer to review the analysis results against the aspects perceived as material to indus- Everyone at LG Electronics strives to try peers to verify what is missing from each other’s list (and vice versa), while create the very best value for cus- internally reviewing the results with related business departments to select and tomers, values that bring excitement introduce the information that is material and useful both to LG Electronics and our stakeholders. Articles on material aspects prepared by business departments and conveniences into their lives. were finalized after a review by management and a third party assurer. Furthermore, LG Electronics carries out its responsibilities as a corporate REPORTING PRINCIPLES citizen with great energy and passion, G4 guidelines of the Global Reporting Initiative (GRI), UN Global Compact from helping those in need to pro- (UNGC) Index, Accountability Principles Standard (AA1000APS), and Stakeholder tecting the environment of the earth, Engagement Standard (AA1000SES) in an effort to bring greater happi- ness to our stakeholders, including REPORTING SCOPE This report covers all business sites of LG Electronics, both in Korea and overseas, customers, investors, and communi- and major supplier sites, including activities and performance in economic, envi- ties. The ultimate goal LG Electronics ronmental, and social areas (for the detailed scope of reporting, please refer to strives for through its sustainability notes for each table). management efforts is to help all our stakeholders achieve sustainable REPORTING BOUNDARY happiness. Information is organized based on material issues and presented under the “DMA (Disclosure on Management Approach)” for each section. REPORTING PERIOD Data from the calendar year 2014, from January 1 to December 31 (for perfor- mance in select areas, data from the first half of 2015 was also included) ASSURANCE Independent Assurance Statement (Korea Productivity Center) (See pp. 84-85) GUIDANCE SYSTEM Information Sources concerning LG Electronics’ Sustainability Management Efforts Directed to the section of this report containing related or detailed information Directed to the website contain- ing information concerning the content of this report LG Electronics Corporate Website LG Electronics Annual Report WWW.LG.COM/SUSTAINABILITY CSR Team, LG Electronics | LG Twin Towers, 128 Yeoui-daero, Yeongdeungpo-gu, Seoul, Korea Email: [email protected] / Tel: 82-2-3777-3263 CONTENTS OVERVIEW MATERIALITY REPORT 2 Report Overview/Contents 4 CEO Message With Our Customers p. 28 6 Management Messages Fair Business Practices 29 Communication with Customers 7 Management Philosophy 31 Communication based on Customer Service 8 Corporate Governance 32 Enhancing Accessibility for People with Disabilities 9 Compliance Risk Management 33 Product Quality & Safety 10 Jeong-Do Management 34 Information Security & Protection of Personal Information 11 Fair Trade Corporate Overview 12 Who We Are · What We Do With the Environment p. 36 14 Where We Operate 16 What We Achieved 37 Products with Greener Features 18 CSR Management 39 Product Stewardship 43 Green Partnerships 44 Environmental Awards 46 EESH Management System STAKEHOLDER COMMUNICATION 47 Management of Energy and Environment at Business Sites 20 Communication with Stakeholders 50 Health & Safety Management at Business Sites 21 Stakeholder Consultation on CSR 22 Communication at Each Stage of the Value Chain With Our Suppliers p. 52 24 Materiality Analysis 53 Procurement Performance 54 Principles for Win-Win Growth 56 Supplier CSR Management KEY PROGRESS & PERFORMANCE 58 Conflict Minerals Management 26 Key Progress & Performance With the Community p. 60 APPENDIX 61 Our Achievements in Social Contribution 79 Economic Data 62 Major Social Contribution Programs 80 Environmental Data 83 Social Data 84 Independent Assurance Statement 86 Memberships/Awards & Recognition With Our Employees p. 68 87 GRI/UNGC Index 91 Past LGE Sustainability Reports/ 69 Global Workforce Contributors to Report Preparation 70 Talent Acquisition & Cultivation 73 Corporate Culture & Work-Life Balance 75 Protection of Labor Rights 4 2014-2015 LG Electronics Sustainability Report Overview // Stakeholder Communication Materiality Report Appendix 5 CEO Message 4 2014-2015 LG Electronics Sustainability Report Overview // Stakeholder Communication Materiality Report Appendix 5 “We are doing our best to remember that our stakeholders, including customers, are the absolute and enduring standard that drives our thinking, inspires our actions, and propels us forward through changing environments and global trends.” What do you think is the most important for sustainability management at LG Electronics? In a rapidly changing business environment, we cannot afford to remain still; we have to constantly think about ways to achieve growth and advance our businesses. At the same time, we have to always remember that our customers are the absolute and enduring standard that drives our thinking, inspires our actions, and pushes us forward, as we focus on creating positive impact on the world. Throughout this process, we always take “Jeong-do Management” as our guiding principle, because strict compliance with the law and standards is both the starting point and ultimate goal of our efforts to become a truly global corporation. Please tell us about LG Electronics’ achievements in sustainability management in 2014. In 2014, we made organization-wide efforts to build and strengthen fundamentals, the very foundation for sustainable and enduring growth. As a result, the strength of our organization is improving, and we are thoroughly preparing to secure opportunities in our future businesses. In addition, both our employees and management are carefully identifying actions and practices required for sustainable management and putting them into practice. We are also defining practices that we need to adopt in conducting business, while directing our interest and energy towards issues that affect both individuals and societies to fulfill our responsibility as a corporate citizen. I am convinced that all of these efforts will come together and help us establish sustainability management as our core strength. What is the direction of LG Electronics’ sustainability management? I strongly believe that first and foremost, corporations must focus on the primary purpose of doing business in order to contribute to society as well as to achieve sustained growth. To this end, it is important for corporations to identify changes both in customers and global trends, to think and prepare in advance, and to execute measures that respond to these changes in a careful and thorough manner. The business landscape around us is shifting constantly and becoming more complex with diverse and intertwined interests creating uncertainties. In order to overcome such challenges and achieve growth, we need to draw on strengths not only from within our organization but also from the outside world, creating synergy greater than the simple sum of our own strengths. In order to further strengthen our capabilities for sustainable management, LG Electronics will actively engage with stakeholders for their valuable opinions, while sharing our market intelligence and customer insight obtained directly from the frontline of business operations. I would like to respectfully ask all of our stakeholders and partners to continue to encourage us and support us in our endeavors. Thank you. May 2015 Vice Chairman and CEO B on J oon K oo 6 2014-2015 LG Electronics Sustainability Report Overview // Stakeholder Communication Materiality Report Appendix 7 Management Messages 1 2 3 4 5 1. Jong Sik Kim building, and developing new business models in order to maintain busi- Chief Operating Officer/President ness sustainability. As a responsible member of society, we also strive to Sustainability at LG Electronics means not only achieving financial per- grow together with communities where we operate and deliver consum- formance but also making contributions to the society as a whole. We er-oriented products. strive to provide safer and
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