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Sustainbility Management Strategy

Sustainability Purpose

To become a top global company that can ensure its survival in the future, CJ CheilJedang creates the two core values, health
and safety and sustainable environment, across the purchase of raw materials, production, consumption, and disposal. To do so,
we aim to achieve the virtuous cycle of Nature to Nature in which we obtain resources from nature, provide food to consumers,
and return the resources to nature.

Sustainability Purpose : nature to nature. Core Values : Raw material, Disposal, Consumption, Production. Health and Safety : Delivering healthy and reliable food to consumers form nature to table. Sustainability Environment : Establishing an environment friendly cycle which obtains resources form nature and returns back to nature. Goals : Minimizing Environmental Impact, Securing Social Leadership, Achieving top-tier capability. Strategic Tasks : Responding to Climate Change, Procurement Of Sustainable Materials, Zero Human Rights Risk, Enhancement Of Health and Nutrition, Eco-Friendly Packaging, Development Of Eco-Friendly Materials Solution, Organizational Culture based on DEI * DEI: Diversity, Equity, Inclusion, Enhancement Of Health and Nutrition. Sustainable Supply Chain. Fundamentals : Establishment of Sustainability Management Governance•Efficient opertaion, Enhancement of Compliance, Reliable ESG Information · Communication

Key strategic tasks

The key strategic tasks are linked to our core values, Sustainable environment, Health and Safety.
We selected tasks as follows, based on their external priority and impact on business.

Core Values Category Goals Strategic Tasks Task Details UN SDGs
Environment Minimizing
Responding to Climate Change Respond to climate change risks and achieve carbon neutrality by 2050
Procurement of Sustainable Materials Increase sourcing of material with enhanced traceability and transparency
Eco-Friendly Packaging Develop reusable·recyclable packaging material and reduce waste
Development of Eco-Friendly Materials Solution Develop large-scale solutions solutions including PHA using a variety of White Bio technologies
HEALTH AND SAFETY Social Securing Social Leadership Zero Human Rights Risk Preemptively manage human rights risks human rights risks for stakeholders
Organizational Culture based on DEI Establish organizational culture based on Diversity, Equity, Inclusion
Governance Achieving top-tier capability Enhancement Of Health And Nutrition Establish CJ Nutrient Policy and expand portfolio of health-oriented products
Sustainable Supply Chain Identify and manage ESG risks of suppliers at an early stage

Corporate Sustainability Governance

We established sustainability management governance to secure our ability to implement consistent and comprehensive sustainability
management and preemptive risk management in order to facilitate timely ESG-related decision-making. To this end, we established
the Corporate Sustainability Committee under the BOD, the highest decision-making body, the Corporate Sustainability Council chaired
by the CEO, the Sustainability Team, and a council composed based on the core ESG agenda.

The highest decision-making body : Corporate Sustainability Committee, Deliberation & Resolution of Strategy and Agenda, Review and Submission of Agenda. Management-level council : Corporate Sustainability Council(chaired by the CEO), Environment > Foods·Bio R&D Center, Food Business Administration Division, Food Production & Manufacturing Department, Change and Innovation Manager, Bio Engineering Division, White BIO CIC - Performance Review and Improvements. Social > Foods·Bio HR Division, Change and Innovation Manager. Economy·Governance > Foods·Grains·Bio Procurement Division, Food Research Institute, Marketing, Legal Affairs Division - Progress report. Dedicated organization : Sustainability Team - Identification of Agenda and Issue Discussion. Working-level Council : Working-level Council for Corporate Sustainability - Establishment of the Core ESG Agenda Council

Risk Management

Preemptive Risk Management

Establishment of the ‘Compliance Management System (CMS 2.0)’

CJ CheilJedang established its CMS (Compliance Management System) 2.0 to forecast risks and take effective measures against them. To enhance existing compliance management, the new system identifies and categorizes potential risks that may occur in each organization. It establishes control measures for each risk and clarifies the R&R of the department in charge (designing, managing, and supervising essential control activities for each risk) and the lead department (conducting activities according to the design of the department in charge) so that the Compliance Team can act as the company-wide risk control tower to organically manage risk across the lead departments, departments in charge, as well as the BOD and its committees.

CEO - CEO MESSAGE, Declaration of the Top Management. Policy : The CJ People’s Promise | Ethical Management Pledge | CP Program Code of Operation | Policy & Guide. Process - Identification → Assessment → Mitigation → RCSA → Monitoring. Governance - Compliance Management System - Board of Directors / Committees, Control Tower, Compliance Officer, Compliance Team, Department in Charge, Lead Department. CMS System, Regulatory Trend, Description, Training, Report, Announcement / FAQ, Process. 10 Major Risk Areas : Fair Trade, Quality Safety, Labor Rights, Environmental Safety(including the climate change), Consumer Protection, Indus trial Safety, Resource Preservation, Anti-Corruption, Property Rights Protection, Privacy Protection
Establishment of a Global Compliance Communication Process

By re-establishing a global communication process among our overseas subsidiaries, regional divisions•headquarters, and domestic headquarters, CJ CheilJedang is building a practical work-sharing and cooperative system between legal and compliance officers to strengthen its global risk management.

Risk Response Division

Situation Supervision Team CJ CheilJedang takes a three-step approach to potential risks in 16 categories, covering the environment (including climate change), industrial safety, quality, and processes, according to severity. We operate a company-wide risk management system to swiftly report and take countermeasures, within 24 hours, through the Risk Response Division whenever a risk is determined to be a major risk. In addition, we utilize an integrated risk management process to prevent any potential confusion or delays that may arise from a risk occurrence, initial recognition of the risk, or response measures.

CEO - Head of the Company-Wide Risk Response Division - Situation Supervision Team - On-Site Response Team, External Response Team, Internal Operation Support Team
Management of Potential Risks

CJ CheilJedang not only identifies potential financial and non-financial risks related to current management activities but also defines potential risks that could have a major impact on its business in the future.
Based on these definitions, we identify potential risks across all our business sites, and our Management Team thoroughly analyzes them and takes appropriate measures to minimize their impact.

Definition and Management of Potential Risks

Definition and Management of Potential Risks
Potential Risk Definition and Impact Management Group Management Policy
Sudden fluctuation in raw material prices Sudden changes in the prices of key raw materials may cause supply and cost risks, impacting profit and loss. Grain Procurement Division Food Procurement Division Bio Procurement Division
Establish a system to monitor the price of raw materials and ingredients
Monitor quantitative indicators
Monitor qualitative developments
Exchange rate management Exchange rate fluctuations may cause increased uncertainty and changes to profit and loss. Financial Strategy Division
Alleviate foreign exchange risk by first reducing exchange rate exposure through matching
Hedge residual exposure through derivatives, such as forward exchange, in accordance with internal foreign exchange control regulations
Strictly prohibit foreign exchange management for speculative purposes
Changes in environmental safety regulations and policies Inadequate responses to changes in environmental and safety regulations and policies at business sites may cause legal risks,
affecting business operations.
Safety Management Team Food Production & Manufacturing Department Bio Engineering Division
Establish a company-wide system for monitoring regulations
: Verify all new and revised regulations that will apply to the company at the pre-announcement stage to prepare advanced application and response measures.
Business site safety Environmental disasters, fire, industrial (severe) accidents, health hazards, and electricity-related factors are defined as the five major risks that may occur at manufacturing sites. These may affect the credibility of the company among both staff and society. Safety Management Team Food Production & Manufacturing Department Bio Engineering Division
Establish a Risk-Top management system at each business site focusing on major accidents
Strengthen the operation of the SDR (safety design review) process
Establish rules for a safe code of conduct (“No Stop? No Touch!”)
Implement step-by-step infectious disease prevention measures
Demographic changes Changing demographics, such as the increase in single-person households and female workers, have an impact across the entire food business. New products need to meet these changing trends and customer needs. Marketing
Develop new HMR products that reflect the trend of pursuing health and convenience
Implement strategies for creating premium HMR products
Upgrade HMR products to the next level based on trend forecasts
Management of business continuity amidst natural disasters Business continuity management risk may occur due to natural disasters or pandemics such as COVID-19. It may affect profit and loss as well as the work patterns of staff. Safety Management Team Food Administration Team Bio Administration Team
Establish an emergency response system
Monitor global emergency situations
Strengthen safety•health management training for staff
Climate Change Risks Physical risks due to increased natural disasters caused by climate change and implementation risks arising from the process to address climate change can make business and financial impacts. Sustainability Team Safety Management Team Food Production & Manufacturing Department Bio Engineering Division
Manage domestic GHG emissions
Assess the impacts of storm and flood damage
Calculate and monitor GHG emissions for suppliers