Road to Sustainability 2021 Sustainability Report Introduction Environmental 018 ESG Factbook 073 Contents CEO Message Environmental Management About This Report Company Overview and Major Achievements Carbon Reduction Global Network Hyundai’s 2025 Strategy Circular Economy Business Performance Electric Vehicles Management and Reduction Facts & Figures Autonomous Driving of Harmful Substances GRI Index Connected Cars TCFD Index Robots Social 033 SASB Index Mobility WEF IBC Stakeholder Capitalism Metrics Human Rights Hydrogen Stakeholder Engagement Employees Open Innovation Sustainability Management Materiality Analysis Suppliers Smart Factories Independent Assurance Statement Product Quality ESG Management Assurance Statement Customers ESG Directions Communities ESG Performance Governance 066 Board of Directors Ethical and Compliance Management Risk Management This report has been published as an interactive PDF, allowing readers to move quickly and easily to pages in the report, and including shortcuts to the related web pages. Reference Page Video Clip Related Link 1 Introduction 2 Environmental 3 Social 4 Governance 5 ESG Factbook 003 CEO Message In 2020, amid the historic difficulties posed by the COVID-19 pandemic, Hyundai Motor The economic outlook for 2021, particularly for those advanced economies, once appeared Humanity now stands on the cusp of defeating the coronavirus pandemic and ushering in a new Company continued its quest to facilitate human progress under its perennial philosophy of rosy on the back of vaccine development. But a number of uncertainties in the global business era. Everything is changing, from the way we approach work to how we think and go about our considering people first. As both a global automaker and member of local communities all environment are expected to persist, ranging from recurring spikes in coronavirus infections lives. But one thing will remain constant and abiding: Hyundai Motor Company’s management around the world, the company surmounted numerous challenges with its steadfast spirit and to supply bottlenecks in global automotive semiconductor production. By focusing on the philosophy that places humanity above all other considerations. Based on this immutable belief, innovated and challenged itself ceaselessly to forge a sustainable new future. following strategic tasks, Hyundai Motor targets not only achieving its business goals, but also we will take the lead in creating a sustainable future in which all mankind can live safely and 2020 was a year in which the company first implemented its mid-to-long term growth plan, transforming itself into a world-leading mobility solutions company in the post-coronavirus era. healthily while enjoying freedom of movement and the unique offerings of our lives. This is the the “2025 Strategy.” On the back of the tireless efforts of all its employees and partners, prime reason Hyundai Motor strives to become a leading solutions provider in the future mobility Hyundai Motor achieved a multitude of milestones around the globe, and at the same time We will build a stronger foundation for growth world. Our progress toward mankind’s better life will continue apace. We kindly ask for your established a robust fundament for fresh growth into the future. As a result, we managed to Hyundai Motor will expand global sales of high-margin models from Genesis as well as various continued interest and support for this meaningful challenge. increase our domestic sales by 6.2 percent and our global market share to 5.3 percent from 2019, SUV models, while reducing production costs by paring down fixed costs and expanding rising above the global automotive industry’s slump from the pandemic last year. the application of common modular components. We will also continuously strengthen our Thank you. digital-based innovation efforts throughout the entire value chain. In order to elevate quality In terms of products, the company’s seventh-generation all-new Elantra compact sedan competitiveness – the fundamental capability of any automaker – we are actively carrying Jaehoon Chang, President and CEO won the prestigious 2021 North American Car of the Year award by the decision of the North out quality improvement activities, including implementing vehicle replacement programs, American Car, Utility and Truck of the Year (NACTOY) automotive-media jury. It was the strengthening reliability-based development quality management, and standardizing quality- second time Elantra grabbed the North American Car of the Year award since its first honor in control processes for our ecofriendly vehicles. Through these efforts, the company will 2012. Meanwhile, the Genesis luxury brand ranked first in both the Initial Quality Study (IQS) channel all its capabilities into securing the deep trust of our customers. At the same time, the and Vehicle Dependability Study (VDS) in the luxury vehicle category, further enhancing its company will lay the groundwork for its rebound in the China business and commercial-vehicle “Progress for Humanity: reputation as a premium automotive brand. business via a host of innovations. In addition, the launch of the company’s first EV brand IONIQ helped the company secure the Continuing our Unstoppable fourth top spot in global ecofriendly vehicle sales and cement its place in the world ecofriendly We will secure competitiveness in our future growth businesses mobility market. Parallel to these advances, the company is currently leading the establishment To secure future business competitiveness and leadership in the competitive global electrified Challenge” of a future hydrogen ecosystem via its early introduction of hydrogen fuel-cell trucks, maiden mobility market, Hyundai Motor will drastically strengthen its electrified vehicle lineup. As part export of a fuel-cell system and other worldwide collaboration efforts. of this transition, the company successfully launched in April 2021 its first dedicated EV, the With ESG (Environment, Society, Governance) related criteria increasingly taking center stage IONIQ 5, which is equipped with a dedicated EV platform, the E-GMP (Electric Global Modular in business management, Hyundai Motor is harnessing all efforts on bolstering its sustainable Platform). We are also striving constantly to provide new value to our customers by offering ESG management as part and parcel of its business management strategy. In the field of specialized EV-based service packages. On the hydrogen front, we will put spurs to our environment, the company aims to contribute to the implementation of the UN Paris Agreement hydrogen business by securing related core technologies and expanding our fuel-cell system goals through the expanded lineup of ecofriendly vehicles, continuous technology development, business, thereby bolstering our initiative for a future global hydrogen society. Continuing to improvement of vehicle fuel efficiencies and carbon emissions reduction across its entire expand our innovative offerings and services, such as community mobility services that serve value chain, including business sites and supply chains. the everyday needs of customers, is another objective of ours for the future. In the field of society, we have set respecting human rights as our unnegotiable priority, We will change the way we work with our customers thereby strengthening the human rights, health and safety as well as supply-chain ESG Hyundai Motor Company – in line with its vision of becoming a Smart Mobility Solution Provider management for all employees at domestic and overseas business sites. Furthermore, we are – is in the process of establishing new work standards that will help us smoothly transition to contributing to the enhancement of customer value by securing product quality and safety, our future role. We will maintain our momentum of change on the basis of employee autonomy and serving the global community through diverse CSV (Creating Shared Value) activities with and responsibility, while eliminating inefficiencies in our modus operandi. The aim is to move in the belief that the competitiveness of our company and of the wider communities in which we a direction more oriented toward serving and empowering our customers all around the world. operate remains vitally interdependent. In particular, we plan to strengthen our customer-oriented quality management by improving In the field of governance, a female non-executive director has been appointed for the not only “product quality,” but also “work quality” by tapping into employees’ creativities and first time, enhancing the diversity and expertise of our board of directors. Likewise we aim talents. In addition, in response to the needs of various stakeholders, including shareholders and to discuss major ESG-related policies, enhance them and review their implementation by investors, we will normalize an ESG-oriented method of operation, by which all Hyundai Motor expanding and reforming the Corporate Governance and Communications Committee under employees would advance long-term sustainable corporate values o​​ ver financial short-termism. the Board of Directors to the Sustainability Management Committee. 1 Introduction 2 Environmental 3 Social 4 Governance 5 ESG Factbook 004 Company Overview and Major Achievements Hyundai Motor Company has been providing car buyers with the best products and services possible ever since its establishment in 1967. Going forward, it will continue to position itself as a “smart mobility solutions provider” based on its “2025 Strategy”