A MORE
BEAUTIFUL
WORLD
2021 Amorepacific Group Sustainability ReportCEO Message

Brand Portfolio

Chapter 1

Chapter 2

Chapter 3

Appendix2

CEO Message

Brand Portfolio

Chapter 1

We MakeA MORE
BeautifulWorld

Chapter 2

Chapter 3

Appendix

Dear valued stakeholders,3With a clear sense of purpose to deliver prosperity
internationally, Amorepacific Group will promote

The Amorepacific Group has been devoted tosustainable consumption by providing products andachieve its mission—“We make A MORE beautiful

services that are friendly to customers, society, andworld”—for the past 77 years. Even when thenature. While seeking harmonious growth with all

cosmetics industry was considered an industry

our stakeholders, we will help bring about a betterin decline, we never once veered from our pathsociety for everyone. At the same time, we will doof determination. Instead, we embraced every

our part to address the climate crisis issue together

development going on throughout the years as anwith others and seek to coexist in harmony with

opportunity to transform K-beauty culture into

the natural world around us. This journey began insomething that everyone across the world aspired

2021, and we have clearly documented our efforts

to be a part of.

and achievements in this report.

Today, we are all regathering our courage and

We at Amorepacific Group are working tirelessly

seeking the wisdom needed to get by as we adapt

and with a sense of tremendous responsibility to

to many of the changes that have been accelerated

create fundamental and lasting progress for theby the COVID-19 pandemic. As we look back on ourhealth and wellbeing of the corporate ecosystem.

founding philosophy of contributing to humanity

We inspire New Beauty in every individual so thatthrough beauty and health, Amorepacific Groupthey can find their own beauty and live a healthy,

announced five sustainability management goals

fulfilling life. I would like to kindly ask for youras part of “2030 A MORE Beautiful Promise.” This

continued interest in and support of Amorepacificis precisely when we started to embark on new

Group as we move forward in the future.

initiatives with a great sense of responsibility. At
the same time, this revealed our determination

July 2022

to support The Ten Principles of the UN Global

Chairman & CEO of Amorepacific Group

Compact (UNGC) and further hasten the executionof the UN’s Sustainable Development Goals for theentire world.

CEO Message

Brand Portfolio

Brand Portfolio

Chapter 1

Chapter 2

Chapter 3

Appendix4

CEO Message

Brand Portfolio

Chapter 1

Chapter 2

Chapter 3

Appendix

5Timeless Wisdom, Ageless Beauty

New Wave of Beauty

SKIN-LOVING, EARTH-CARING

Sulwhasoo formulates innovative skin science by infusing wisdomwith modern science for ageless beauty with healthy radiance.

Global beauty brand that provides healthy, glowing skin and delivers a new
beauty experience.

www.sulwhasoo.com

www.laneige.com

innisfree is an eco-conscious beauty brand.
We are committed to highly effective, clean, skin-conscious beauty
and we seek to take action to reduce any environmental impact.
www.innisfree.com

CEO Message

Brand Portfolio

The Artisanship of Beauty
www.amorepacific.com

Chapter 1

Chapter 2

Make it Simple and Clear,
the most beautiful thing that’s like me

Chapter 3

Appendix

A Bio Science Based, Highly Functional Skincare Brand
www.iope.com

www.mamonde.com

6

A Mindful Clean Beauty Brand Bringing Goodness
to Your Skin and Nature
www.primerabeauty.com

Experience Goodness of Korean Nature Everyday

Medi Becomes Beauty

Contemporary Seoul Beauty

www.hanyul.com

www.aestura.com

www.hera.com

espoir, a unique and casual makeup brand that inspires
creativity in daily life and enjoys taking on new changes
www.espoir.com

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Brand Portfolio

Chapter 1

Chapter 2

Chapter 3

Appendix

7

PLAY PINK, PLAY ETUDE

Healthy Scalp & Hair from Asian Wisdom

CHANGE YOUR HAIR, CHANGE YOUR LIFE

Scalp Skin Care Ultra Expert LABO’H

www.etude.com

www.ryo.com

www.miseenscene.com

www.laboh.co.kr

Fashion inspired, Professional Touched

A gentle, yet effective solution for your sensitive skin,ILLIYOON

Happy Moment from Pleasant Fragrance

Customized Optimal Dental Solutionwww.amosprofessional.com

www.illiyoon.com

www.happybath.com

CEO Message

Brand Portfolio

Chapter 1

Author of Perfume since 1981

Inner Beauty Solution

www.goutalparis.com

www.vitalbeautie.com

Everyday Life Beauty Device

Real Tips for BRO
www.brontips.com

Chapter 2

Chapter 3

Appendix

Wellness Life is Beauty

8

Meaningful Relaxation Delivered by Tea from Jeju
www.osulloc.com

Chapter 1

CEO Message

Brand Portfolio

Our Vision

Chapter 1

Chapter 2

Chapter 3

Appendix

10

Live Your New Beauty
Amorepacific Group is dedicated to helping each and every customer
discover their innate beauty inspired by New Beauty and live healthy,
fulfilling lives.

New Beauty
Inspired byLife
New Beauty
Created with
New Beauty Inspired by Life
Transcending the meaning of beauty in the narrow sense, AmorepacificGroup expands the realm of beauty to the entire lifecycle of customers,
pursuing wellness care for healthy and balanced inner & outer beauty.

Amorepacific Group’s New Beauty is a newparadigm of beauty that values the innate beautyof every being and pays attention to its potential.
We pursue beauty that is inspired by the lives of

New Beauty Created with Digital
By leveraging digital technologies and customer data, we provide hyperpersonalized solutions, including customized cosmetics, across all
touchpoints.

our customers and seek new ways to realize thebeauty of mind and body. We deliver the best
personalized and customized solutions basedon digital technology. And we empathize with awider reach of stakeholders across the world.

New Beauty Resonating with Empathy
Amorepacific Group respects the beliefs of individuals, diversity, and havea deep love for our planet. With strong compassion for humanity, we takecare of and resonate with the entire corporate ecosystem.

New Beauty
Resonating with

Empathy

DigitalCEO Message

Brand Portfolio

Our Value System

Chapter 1

Mission

Chapter 2

Chapter 3

Appendix

We make A MORE beautiful world
Amorepacific Group has the mission to make a more beautiful world,and has a firm belief that the world becomes more beautiful when each and every
person shines with their own unique beauty. This is why we take this path.
To realize this dream, we promise to follow five principles at work.

ABC Spirit

Customers first
We analyze situations and issues from the perspective of our customers andprioritize customer satisfaction in decision making to ensure prompt actions.

Be the first and the best
We continue taking bold initiatives without fear of failure to make innovations withnew ideas and methods as well as to achieve the highest quality.

Collaborate with an open mind
To achieve common goals, we actively share information and constructively
communicate with others beyond the boundaries of business divisions.

With the founding philosophy of contributing tohumanity through beauty and health,Respect differences

Amorepacific Group is taking steps in the journey

We respect differences, discover strengths in diversity,and act politely with one another.

of beauty to make a more beautiful world.
Each brand, distribution channel and country has
different roles, so everyone keeps the Group’s

Act with integrity

promise with the world by sharing our mission

We connect our mission with our work, observe our principles,and complete our work with a responsible attitude.

and the ABC spirit.

11

CEO Message

Brand Portfolio

Global Network

Chapter 1

Chapter 2

Chapter 3

Appendix

12

Major Holding Companies and Subsidiaries― Revenue― Number of employees

Korea

North America

3,274.4billion KRW
6,602employees

101.8billion KRW
139employees

Moscow
Paris

Toronto
New York

Seoul(HQ)
Shanghai

Tokyo

Delhi
Dubai

Hong Kong
Bangkok
Kuala Lumpur

Taipei

ManilaHo Chi Minh

Singapore
Jakarta

Total Revenues

5,326.1

billion KRW

Total number of employees

11,171

Melbourne

Europe and Others

Asia

36.9billion KRW
63employees

1,913.1billion KRW
4,367employees

employees* Revenue figures are based on the 2021 consolidated financial statement of Amorepacific GroupCEO Message

Key Achievements

Strengthening
the Brand’s
Growth Engine

Brand Portfolio

Chapter 1

Chapter 2

Chapter 3

Appendix

House of Sulwhasoo:Space Permeated with Tradition and Modern Aesthetics
In November 2021, Sulwhasoo opened the brand’s flagshipstore, the House of Sulwhasoo, in Bukchon, an area ofcentral Seoul where the value of tradition has been passed
down for centuries, and the past and present have been
harmonized. The House of Sulwhasoo, which radiantly
captures Korean values and a sense of beauty interpreted
from a contemporary perspective, is open to everyone
who wants to experience Sulwhasoo’s long history anddistinguished heritage, as well as its aesthetics and value.
The House of Sulwhasoo is a hybrid between a hanok(traditional Korean house) from the 1930s and a yangok(Western-style house) from the 1960s. This intercontinental
design combination helps customers feel the architectural
beauty which connects different periods in history andexperience the brand’s odyssey towards beauty.
With Hanok, visitors can viscerally feel how Sulwhasoo’s
legacy and aesthetics are reinterpreted for modern times,
while Yangok allows people to take part in and fully enjoy
the retail experience of exclusive services and carefully
selected high-end products as they bask in Sulwhasoo’s
fashionably chic aura.
Each part of the House of Sulwhasoo features conspicuously
meaningful elements such as books, music, spatial design,and foods, all of which were meticulously chosen byreflecting on Sulwhasoo’s unique taste. That is how we havebeen able to increase the familiarity of the Sulwhasoo brandto a new generation of customers who want to embrace avariety of cultures. Today, the House of Sulwhasoo is laying
the foundation for win-win growth in the future througha multi-faceted collaboration with local merchants near
Bukchon. At the same time, it is preparing cultural classes tocommunicate and interact with residents in the community.

House of Sulwhasoo in Bukchon

13

CEO Message

Brand Portfolio

Chapter 1

Chapter 2

Chapter 3

Appendix

Limited Edition of LANEIGE Neo Cushion:
Made in Collaboration with Maison Kitsuné
LANEIGE, a functional beauty brand that delivers a new
beauty experience, collaborated with Maison Kitsune, aFrench fashion brand, to release the limited edition Maison
Kitsuné × Neo Cushion Matte in September 2021. The conceptof the product stems from “Hey NEO! Let’s CHILLAX!” This
encapsulates the lifestyle of millennials and Gen Zers, bothof whom pursue freedom in their leisure time even amid thehectic pace of day-to-day life. This one-of-a-kind product thatis difficult to come by consists of a limited edition Neo Cushion
Matte (two types), an eco-bag, a pouch, and a PopSockets grip,
all of which were specially produced for this collaboration.

LANEIGE Neo Cushion is a high-adhesion cushion productthat enables natural and matte skin expression. By applying a
360-degree borderless design without front or back borders—
and with containers of attractive colors at your disposal—
its innovative design has become a hot topic of conversation
lately. The thin-layered makeup strongly adheres to the skinand has quickly been gaining popularity as a long-lastingproduct that hardly smears, even when wearing a facecovering or mask.

Published in Global Academic Journal:
Research on Improving Your Skin Barrier throughStress Hormone Control

MY VITAL BEAUTIE, a personalized health functional food service

Launch of MY VITAL BEAUTIE:A Personalized Health Functional Food Service
In May 2021, the inner beauty solution brand VITALBEAUTIE launched MY VITAL BEAUTIE, a customized
health functional food (HFF) recommendation &sales service. MY VITAL BEAUTIE calculates scientificand objective data based on an individual’s own
health condition and lifestyle, identifies nutrients for
supplementation, and recommends health functional
food in small portions. Through this service, customers
can receive customized HFF solutions such as a one-baga-day portion designed specifically for each individual.

The limited edition Maison Kitsuné × Neo Cushion Matte

14

MY VITAL BEAUTIE offers a wide range of services alongwith products containing functional substances thatsolve major health concerns for people today, as well as
vitamins and minerals that supplement basic nutrients.
If you are concerned about body fat, we recommend
not just our unique green tea extract that helps reduce
body fat, but also the vitamins and minerals you need
the most. We offer these products, which contain all thenecessary substances your body needs, in one small bag aday. Customers are currently served through a reservation
system at the company’s Business Center in Seoul.

A joint research team made up of professionals from theAmorepacific R&I Center and Yonsei University Wonju
College of Medicine conducted a long-term study to reveal
the adverse effects of stress on the skin and to develop an
effective remedy to improve skin barrier function that isdamaged due to stress. The joint research results were
published in the June 2021 issue of Scientific Reports , aninternational open access journal published by Nature .
The joint research team paid close attention to theeffectiveness of hydroxydaidzein, an isoflavone whichis released when beans are fermented under specificconditions. As a result of the research, the team foundthat hydroxydaidzein helps maintain healthy skin byrestoring the skin barrier function to a normal level—evenin stressful situations—and inducing pH normalization.
The R&I Center is developing new cosmetics by utilizing
the significant results and solutions realized from theresearch.

Summary of the Research Results Published in
Scientific Reports (2021)
StressSkin barrier function’s resilience
Level of cortisol on keratin layer
Firmness of keratin layer
Skin pH
Lipid level on keratin layer

Stress +Hydroxydaidzein

CEO Message

Brand Portfolio

Key Achievements

Customized
Digital Innovation

Chapter 1

Chapter 2

Chapter 3

Appendix

15

Winners of the Innovation Award at the CES 2022,
Mind-linked Bathbot and Myskin Recovery Platform
Mind-linked Bathbot and Myskin Recovery Platform, both ofwhich are customized technologies developed by AmorepacificGroup, won the Innovation Award at the world’s largest
consumer electronics and technology show, the CES 2022.

The Myskin Recovery Platform is an integrative platform
where customers can easily measure daily skin conditions andmonitor any improvement based on the customized solution
provided.

The Mind-linked Bathbot is a solution which analyzes the
feelings of a person using brain waves and then creates abath bomb of colors and fragrances reflecting the results of
the analysis by a robot. This is accomplished by having a user
wear a headset equipped with eight sensors as the programmeasures the person’s brain waves in real-time, analyzes thedata, and finds the perfectly customized fragrance and color
for the person. Amorepacific Group’s Mind-linked Bathbot
was unveiled to customers for a sneak peek in May and June
2021 at Amore Store Gwanggyo and The Hyundai Seoul in
Yeouido.

When customers use their smartphone cameras and LED
mirrors together to diagnose changes of skin surface condition
and measure moisture levels and firmness using a small
sensor, AI subsequently analyzes the skin data and provides
cosmetic solutions based on the results to offer customized
solutions for further skin improvement. In addition,
Amorepacific Group is currently preparing to link its Myskin
Recovery Platform with other customized beauty solutionproducing devices. Eventually, the Group’s beauty devices will
be expanded to diverse areas based on fusion beauty solutions.

Ultra-slim Wearable Skin Measuring Device

Published in Global Academic Journal: Development of
an Ultra-slim Wearable Skin Measuring Device
Through a joint study with a Massachusetts Institute ofTechnology (MIT) research team, the Amorepacific R&I
Center developed an ultra-slim wearable electronic skindevice which can stably measure one’s skin condition
over a long period of time, even when the external
environment changes. The ultra-slim wearable skinmeasuring patch feels like one’s own skin due to theperforation patterns that are similar to pores, so skinconditions can be measured and analyzed in various
external environments to secure customized data. Basedon this, cosmetics fit for special environments or particularskin conditions can be developed. Amorepacific publishedan article about this achievement in Science Advances , arenowned international journal, in June 2021.

Mind-linked Bathbot

Myskin Recovery Platform

R&I Center will continue to develop a variety of functional,
customized products through research on electronic skintechnology.

CEO Message

Brand Portfolio

Chapter 1

Chapter 2

Key Achievements

The First Korean Beauty Company to Join RE100

A Leader in
Eco-friendly
Business

Amorepacific joined the global RE100 (Renewable Energy100) initiative on March 10, 2021, becoming the first
Korean beauty company to do so. RE100 is an international
campaign for companies to voluntarily declare that they will
supply 100% of the electricity from renewable energy.

Chapter 3

Appendix

The campaign was launched by the international non-profit
organization The Climate Group, in partnership with CDP,
in 2014. Today, hundreds of companies have joined theinitiative around the world, and Amorepacific is the only
beauty company in Korea to have joined. RE100 reporting
requires information from every worksite both in Korea
and abroad, including Amorepacific’s headquarters, R&I
centers, logistics, and production sites.
Amorepacific has been changing to renewable energy
through various methods to accomplish RE100, such as
direct power purchase agreements* and green pricing by
the Korean government. As a result, Amorepacific wasable to replace 18.5% of all the worksites’ energy use withrenewable energy in 2021.
Amorepacific will develop more low-carbon footprint
products using ingredients and packaging materials with
reduced GHG emissions based on life cycle assessment (LCA)
results. Amorepacific will continue to work hard to respondto climate change and reduce its carbon emissions.

*	Power Purchase Agreement (PPA)	
A contractual agreement between energy buyers and sellers (developers,
private generators, investors) to buy and sell a certain amount of energy

Solar panels on the roof of Amorepacific global headquarters

16

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Chapter 1

Chapter 2

Chapter 3

Appendix

VITAL BEAUTIE and CUBE ME Obtained GreenTechnology and Product Certification

primera, Winner of the Korean Green Product of the Year
2021 Award

Inner beauty solution brand VITAL BEAUTIE and wellness
life brand CUBE ME obtained the Korea Institute forAdvancement of Technology’s Green Technology andProduct Certification for three of their products thatuse ultra-high pressure ginseng processing technology(Cheonsamhwa) in May 2021. Green Certification is
given to potential technologies or projects in accordancewith the Framework Act on Low Carbon Green Growthdeclared in 2010. Certifications are given after the Green
Certification Review Board thoroughly examines cases
it receives from the Korea Institute for Advancement ofTechnology.

primera Skin Relief UV Protector EX was selected as one of
Korea’s Green Products of the Year 2021 by the Korean Green
Purchasing Network. The sunscreen is packaged in a plasticreducing paper tube, reducing the use of plastic by about 70%
compared to previous tubes. Its box is made with Earth Pactpaper, a 100% sugarcane byproduct-based paper packaging
solution that avoids deforestation. Furthermore, this productdoes not use any substance that disrupts the endocrine systemof coral reefs for the preservation of the Earth’s ecosystems.

The green-certified products—VITAL BEAUTIE Berries
and Red Ginseng for You, CUBE ME Red Ginseng Plus,
and Red Ginseng Stick Cube—utilized ultra-high pressure
ginseng processing technology that had also obtained
Green Technology Certification in 2020. The technology
reduces ginseng processing procedures compared toexisting methods. In addition, it is meaningful in terms ofenvironmental protection because it cuts down on energy
consumption by more than 10% and effectively removes
soil microorganisms left on ginseng roots without using
heat or chemical substances.

CUBE ME Red Ginseng Plus

VITAL BEAUTIE Berries and Red Ginseng for You

primera Skin Relief UV Protector EX

17

All of Korea’s Green Product of the Year Award winners are
selected through a vote that includes civic groups, membersof academia, industry experts, and consumers. Amorepacificreceived one of these prestigious awards in the first year thecompany had ever applied for it. We will continue to expand
our product lineup using sustainable packaging in order toreduce the use of plastics.

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Brand Portfolio

Chapter 1

Chapter 2

innisfree’s Planet-First Frequency Campaign:
Empty Bottle Frequency

Launch of New Refillstation:
innisfree Gangnam Flagship Store’s Refill Station

In June 2021, innisfree launched a new empty bottle
frequency campaign. This positive, planet-first frequency
campaign encourages people to collect empty bottles forrecycling. When customers return innisfree empty bottles
after use to an innisfree store, they can earn empty bottle
frequency stickers (for discounts and freebies) along with
Amorepacific Beauty Points. You can always check how
many frequency points you have on the innisfree mobile
app or website.

innisfree has been a leader in sustainable activities such ascollecting empty bottles. Recently, it opened a refill station
to offer a more eco-friendly consumption for customers
in line with the demands of the times, an era whenenvironmental issues must be properly addressed.

In addition, innisfree motivated people to take part in
the brand’s eco-friendly campaign by providing actively
participating customers with a number of benefits,
including different rewards according to the accumulated
number of empty bottles they collect per year and special
rewards for first-time participants.

Chapter 3

Appendix

innisfree Gangnam Flagship Store’s Refill Station sells thecontents in 10 gram-units. Customers can take desired
amount of content in their own refillable container. This
enables innisfree to help people live naturally with lessplastic as the brand continues to do its utmost to reduce
plastics.
The Refill Station sells three products from innisfree’s
premium lifestyle re-stay lineup: Calming Shampoo,
Comforting Body Cleanser, and Embracing Handwash.

innisfree collected 1,105 tonnes of plastics and glassfrom 2011 to 2021. This had the effect of reducing
1,418 tonnes of CO2. innisfree will continue to conduct
small but important activities for the Earth together withcustomers.

innisfree Empty Bottle Frequency Campaign

innisfree Gangnam Flagship Store’s Refill Station

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CEO Message

Brand Portfolio

Business Review

Chapter 1

Chapter 2

Chapter 3

Appendix

Amorepacific Group’s Financial Performance(billion KRW)

Category

2019

2020

2021

Revenue

6,284.3

4,930.1

5,326.1

Operating profit

498.2

150.7

356.2

Net profit

282.4

22.0

292.0

Amorepacific’s Financial Performance(billion KRW)

Category

2019

2020

2021

Revenue

5,580.1

4,432.2

4,863.1

Operating profit

427.8

143.0

343.4

Net profit

223.8

21.9

180.9

Amorepacific Group’s Revenue from Domestic Business(billion KRW)

19

Amorepacific Group’s Revenue Ratio
Domestic

61.5%

5,326.1 billion KRW, an increase of 8.0% fromthe previous year, while its operating profit stood

4,064.5
2,992.1

at 356.2 billion KRW, an increase of 136.4%.
Faced with challenging business conditions

3,274.4

38.5%

Amorepacific Group’s Revenue from Overseas BusinessAsia

In 2021, Amorepacific Group’s revenue reached

Overseas

North America(billion KRW)

Europe and Others

2,219.7
34.2
93.6
2,092.0

due to COVID-19 and internal and external

1,938.0

2,051.7
36.9
101.8
1,913.1

30.2
76.0
1,831.8

uncertainties, Amorepacific Group sought
to strengthen its business competitivenessthrough winning brands, digital transformation,and profit-driven restructuring based on its
management principle of “Winning Together.”

2019

2020

2021

2019

2020

2021

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Appendix

20

Amorepacific Group’s Business Performance
Amorepacific
In 2021, revenue at Amorepacific, the Group’s major subsidiary, went up by
9.7% from the previous year to 4,863.1 billion KRW, while its operating profit
increased by 140.1% to 343.4 billion KRW. Responding to changes in thecosmetics market, Amorepacific sought to improve its business structure with afocus on strengthening the growth of online channels along with the qualitative
improvement of offline stores. In Korea, the company operates two experiential
stores, Amore Seongsu and Amore Gwanggyo, where customers can experience
Amorepacific brands and products firsthand to their heart’s content. In the online
business, the company provides an omni-channel customer experience by running
digital pop-up stores and social media channels to strengthen communication
with customers. In addition, Amorepacific has continued to improve brandattractiveness by fostering key products and launching innovative items at thesame time.

Neo Cushion Phantom Violet in collaboration with Samsung Galaxy Buds Pro

The renewed version of the Illiyoon Ceramide Ato line

Domestic Cosmetics Business

Domestic Daily Beauty BusinessIn 2021, revenue from the domestic cosmetics business reached 2,593.2 billion
KRW, an increase of 17.3% from the previous year. Online channels led domestic
sales growth in total through a reinforced collaboration with digital platforms andenhanced digital marketing. Alternatively, traditional offline sales decreased due tosocial distancing measures and the company’s reorganization of offline channels.

In 2021, revenue from the daily beauty business stood at 482.5 billion KRW, adecrease of 2.7% compared to the previous year. Although online sales increased
due to enhanced digital marketing, total revenue fell as a result of a revenue decline
in offline channels and global e-commerce.

In 2021, Amorepacific worked relentlessly to improve its brand competitiveness byintroducing innovative and differentiated products in key categories and renewing
key items. For example, Sulwhasoo renewed its Essential Comfort and Concentrated
Ginseng Renewing product lines; HANYUL renewed its Geuk Jin line; and LANEIGE
expanded its key product lineup by releasing Neo Foundation and Neo Powder. For
its part, IOPE solidified its leadership in the functional category by expanding its
anti-aging lineup with the launch of Super Vital Cream Bio Potential; Mamondesecured its future growth momentum by expanding its product portfolio in thefunctional category through the launch of its Retinol Ampoule Toner and Bakuchiol
Retinol Cream.
Furthermore, Amorepacific introduced a number of collaboration products bybrand to boost product attractiveness. HERA came out with Black Cushion Couture
in collaboration with a high-end designer brand called JAYBAEK COUTURE, while
LANEIGE released limited edition products such as Maison Kitsune x Neo Cushion
Matte jointly with a French fashion brand and Neo Cushion Phantom Violet in
Amore Seongsu beauty librarycollaboration with Samsung Galaxy Buds Pro.

Amorepacific focused on nurturing its premium functional lines by releasing new
products and renewing products of major brands such as Ryo, mise-en-scene,
HAPPY BATH, and Illiyoon. Looking at these brands more in-depth, mise-enscene’s Skincare Perfume shampoo and treatment, which reinforces scalp care andcan help better maintain one’s hair fragrance, was very popular with customers;
HAPPY BATH expanded its Skin U line, which includes skincare ingredients; andIlliyoon renewed its key product line, Ceramide Ato, making every effort to actively
respond to segmented customer needs.
On top of that, Amorepacific has been running Amore Store Hair & Body at theE-mart Jayang store since April 2021 so that customers can experience various daily
beauty items such as shampoo and bodywash. At the same time, customers can buy
as much or as little shampoo and body wash products as they want by using a refill
container.

CEO Message

Brand Portfolio

Overseas BusinessAmorepacific’s overseas revenue was 1,802.3 billion KRW
in 2021, an increase of 3.3% from the previous year, while
its operating profit stood at 51.8 billion KRW, an increaseof 190.4% over 2020. Overseas sales as a whole also grew,with sales growth from luxury brands mainly in Asia.
Revenue in Asia went up by 2% year on year thanks tosales growth in China, where Sulwhasoo especially focusedon fostering the Concentrated Ginseng Renewing line
mainly via e-commerce as well as elevated brand image byparticipating in Chinese intangible cultural heritage events,
all of which led to positive sales results. In addition, theTimetreasure Honorstige line was launched to strengthen
Amorepacific’s luxury brand image. In the ASEAN region,
with strengthened social distancing measures as the resultof a resurgence of COVID-19 and a decrease in customer
movement to offline stores, Amorepacific streamlined
its department store channel and other offline stores toimprove the efficiency of business operations by focusing
on profitability. Moreover, the company strengthened
collaboration efforts with e-commerce platforms andfocused on digital marketing, which in turn heightened

Chapter 1

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Chapter 3

And with Sulwhasoo, it showed solid growth at Sephora,
mainly driven by First Care Activating Serum, as it
diversified its online channels by entering new e-commerce
platforms.
In Europe, revenue grew by 16% year on year thanks tosales growth in e-commerce from the LANEIGE brand.
LANEIGE strengthened its collaboration with the Sephorachannel and concentrated on its key category, lip products,
while diversifying business channels by entering a British
e-commerce channel, Cult Beauty, for the first time.
innisfree was also launched through Sephora to expand
customer touchpoints. In addition, Goutal Paris augmented
its brand attractiveness through brand renewal andreinforced marketing activities.
In Asia, Amorepacific’s operating profit improved over theprevious year due to the improvement of its luxury brandmix and streamlined offline stores. In North America andEurope, the company’s operating profit also improved due
to sales growth from e-commerce and enhanced cost-saving
measures.

Appendix

21

innisfreeespoirinnisfree’s offline revenue decreased due to the reduced
number of offline stores, but functional products suchas Black Tea Youth Enhancing Ampoule and Retinol Cica
Repair Ampoule saw growth by expanding their customer
base. Additionally, revenue from innisfree’s online businesswent up by strengthening strategic collaboration withdigital platforms.

espoir’s revenue increased by focusing on the online
channel and strengthening its face makeup productportfolio. The level of operating loss was reduced
compared to the previous year through an improved
channel mix and a reduction of fixed costs throughstore closures. On the other hand, espoir reinforced its
leadership in the face makeup category by releasing new
cushion items that included Pro Tailor Be Powder Cushion
and Water Splash Tone Up Cushion.

ETUDE
Although ETUDE’s revenue from online and multi-brandshops grew, the brand’s total revenue decreased due tothe streamlining of offline business. While there were also
operating losses, the amount of these losses was reduced,
as the company’s online channel mix was improved andfixed costs were reduced. In addition, ETUDE reinforced
its product competitiveness by launching a variety of new
products in collaboration with other companies, including
Hershey’s Play Color Eyes Mini, Etude House Contouring
Shadow Shading, Fixing Tint.

customer responses with respect to online channels.
In North America, there was an overall year-on-year revenue
increase of 29% due to the rise in sales of e-commerce andmulti-brand shop channels. innisfree streamlined its offline
stores in 2020 and expanded its presence at Sephora, an
American beauty multi-brand shop, in 2021. E-commercerevenue grew through brand launches on Amazon andgrowth in existing channels. At LANEIGE, it expanded its
customer range by releasing BTS l Amorepacific Lip Sleeping
Mask, a collaboration product with the world-famous
boyband BTS.

Performance of Subsidiaries
Category
innisfree

2020

2021

Category

348.6

307.2

7.0

-1.0

AMOS
Professional

Revenue

111.3

105.6

OSULLOC

Operating profit

-18.0

-9.6

Revenue

42.5

46.7

Operating profit

-2.3

-0.7

Revenue
Operating profit

ETUDE

espoir(billion KRW)

2020

2021

Revenue

67.9

61.9

Operating profit

14.3

11.2

Revenue

47.7

65.0

Operating profit

0.1

3.2

AMOS Professional
The company reduced its duty-free channel presence tofocus on its business with beauty salons. However, AMOS
Professional strengthened its highly regarded capabilities,
with It’s Glow (a hair coloring product line) and Repair
Cica (a product line for extreme damage care in connection
with clinical treatments) respectively releasing new
products. In addition, this subsidiary’s brand, AYUNCHE
bolstered its attractiveness as a brand for beauty salonsand for millennial designers through brand reframing. Its
operating profit decreased over the previous year due toa revenue decline and expanded marketing investment in
the renewal of AYUNCHE.

OSULLOC
Driven by strong online sales of gift sets, OSULLOC’s
overall revenue increased. Operating profit increased
year-on-year due to revenue growth and improvement
in its channel mix. Furthermore, its flagship store,
OSULLOC Teahouse Bukchon, was opened andsubsequently strengthened the customer experience andenhanced brand attractiveness.

Chapter 2

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2030 A MORE Beautiful Promise

2021
Key Achievements

Chapter 1

Chapter 2

Chapter 3

Appendix

23

Move Forward Together with Customers and Society
2030 Goals

Promise 1
Instill the values of environmental
and social friendliness into 100% of our
new products and pursue endeavors thatencourage sustainable living.

Realizing sustainability in 100% of
our new products every year

2021 Key Achievements●

recycled plastics and FSC-certified paper for forest management)●

Conduct life cycle assessments to help reduce theenvironmental footprint of all our new products

Realizing sustainability for 88% of our new products (e.g. using●

Receiving Product Water Footprint certification for the LANEIGE Water
Bank line (9 items) and Product Carbon Footprint certification for the
Sulwhasoo Essential Comfort line (2 items) from the Carbon Trust
The first Korean beauty company to join the EcoBeautyScore
Consortium, a global initiative that 37 global companies formed todevelop an environmental impact assessment and scoring system.

●

Seek technological innovations inGreen Chemistry

ultra-high pressure ginseng processing technology for cosmetics
ingredient●

Conduct brand campaigns that promoteresponsible consumption

Promise 2
Promote diversity and inclusion across all our
global workplaces and beyond, while seeking

Build a more diverse and inclusive work
environment with employee programs that shine
a light on different cultures and perspectives

Obtained Green Technology Certification for the development of

Conducted an environmental habit challenge that allows customers
to easily practice reducing their water footprint in their daily life:#BYEWaterFootprint!

●Established a robust diversity and inclusion policy●

Developed educational programs and conducted pilot programs for
employees

harmonious growth with all our stakeholders.
Invest 50 billion KRW to support the financial
independence of socially vulnerable groups
Invest 50 billion KRW to support a healthy lives
and culture initiative for citizens●

Invested 3.23 billion KRW through Beautiful Life, Hope Store, BETTERSHE programs, and MEET YOUR DREAM program for teenagers●

Invested 3.03 billion KRW through the online/offline integrated
campaign Pink Run Plus, Pink Tour, and Makeup Your Life

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Chapter 1

Chapter 2

Chapter 3

Appendix

Coexist Responsibly with Nature
2030 Goals

Promise 3
Achieve carbon neutrality and zerowaste-to-landfill across our production

2021 Key Achievements●

Use 100% renewable energy at all our production
sites globally

Prepared an RE100 Roadmap to replace electricity at all our business sites with 100% renewable energy●

Converted 18.5% of electricity used at all our business sites to renewable electricity through efficient energy management

Convert all distribution vehicles used in Korea into
eco-friendly vehicles●

Purchased five electric vehicles for our Incheon Logistics Center●

Partially changed the method to handle dust waste at Amore Beauty Park from landfill to recycling,

and the introduction of green pricing

sites worldwide.

Reduce landfill waste at production sites to zero

Promise 4
Reduce the use of plastics in product

Design all plastic packaging materials to be 100%
recyclable, reusable, or compostable

and conducted an in-depth analysis of Amorepacific’s waste management status●

Designed packaging structures that can recycle, reuse, and compost 49.5% of plastic packaging materials by improving the structures
which hinder the recyclability of packaging materials, as well as changing the materials and colors.

packaging and create 100% reusable,
recyclable or compostable plastic
packaging materials.

Promise 5
Invest KRW 10 billion into theconservation and sustainable use of

Use recycled or bio-based plastics for 30% of allplastic packaging●

Applied recycled plastics or bioplastics to 3.9% of our plastic packaging

Provide more refillable products and services●

Opened a refill station at the Amore Store Hair & Body inside E-mart Jayang●

Signed an MOU with the Korea Arboreta and Gardens Institute for biodiversity conservation and restoration through joint research●

Invested 1.08 billion KRW for biodiversity conservation and its sustainable utilization●

Achieved an RSPO-certified palm oil use rate of 41.7%●

Received the highest score (14.5) among Korean companies in the 2021 edition of the WWF Palm Oil Buyers Scorecard●

Revised our supplier sustainability guidelines in a joint effort to prevent deforestation globally

Invest KRW 10 billion into biodiversity
conservation efforts and climate change
adaptation technologies

biodiversity and increase the use of
RSPO-certified palm oil to 90% ormore by 2023.

Convert our palm oil use into more than 90% of
RSPO-certified palm oil by 2023

24

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Chapter 1

Chapter 2

Chapter 3

Appendix25

Move Forward Together with Customers and Society

primera and Illiyoon Release Vegan-certified Products

Realizing
Sustainability in
New Products

Amorepacific has developed vegan-certified products
to bring about inner beauty with value consumption inan effort to safeguard animals. In 2021, we practiced
animal protection by releasing products that do not use
animal-derived ingredients and are not tested on animals
in the primera Free & Free line and Illiyoon Ceramideline. Amorepacific will continue to expand responsible
consumption by developing products that realize
sustainability.

Promise 1

Instill the values of environmental and social friendliness into 100% of
our new products and pursue endeavors that encourage sustainable living.

primera Free & Free: A vegan-certified productCEO Message

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Chapter 1

Chapter 2

Chapter 3

Appendix

26

Move Forward Together with Customers and Society

Water Footprint-certified LANEIGE Water Bank Line

Reducing theEnvironmental
Footprint of All
Our New Products

LANEIGE’s newly launched Water Bank Blue Hyaluronicline precisely embodies sustainability principles. LANEIGE
has obtained Carbon Trust Product Water Footprint
certification for the entire Water Bank product line. It has
also reduced its water use by 3.05L for each unit of creamand by 0.25L for each unit of serum in its effort to bring
down water use and increase efficient water resource
management throughout the product lifecycle. In
addition, the products have been improved to lessen theirimpact on the aquatic environment and have an increased
amount of biodegradable ingredients while concentrating
on desirable ingredients for the skin. On top of this, FSCcertified paper was used for packaging boxes in order torealize sustainable forests.
Carbon Footprint-certified Sulwhasoo Essential Comfort Balancing Water
and Balancing Emulsion

LANEIGE Water Bank Blue Hyaluronic Cream

Carbon Footprint-certified Sulwhasoo
Essential Comfort line
Amorepacific’s leading luxury brand, Sulwhasoo, hasreduced its packaging materials and improved its
recyclability in a bid to fulfill its responsibility for theenvironment. As a result, Sulwhasoo Essential Comfort
Balancing Water lowered its annual carbon dioxide
emissions by 0.6 tonnes, and Sulwhasoo Essential Comfort
Balancing Emulsion by 17.8 tonnes throughout the wholeprocedure of processing, manufacturing, distributing, anddisposing the products based on 2021 sales performance
results. The two products also obtained Product Carbon
Footprint certification from the Carbon Trust in the U.K.
This has the effect of 78 thirty-year-old pine trees absorbing
carbon dioxide for Essential Comfort Balancing Water and
2,196 thirty-year-old pine trees absorbing carbon dioxide
for Essential Comfort Balancing Emulsion.

LANEIGE Water Bank Blue Hyaluronic Cream featuring Product Water Footprint certification

CEO Message

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Chapter 1

Move Forward Together with Customers and Society

Chapter 2

Chapter 3

Appendix

27

Reinforcing Eco-friendliness with Ginseng Processing
Technology for Cosmetics

Innovations in
GreenChemistry

In 2021, the Amorepacific R&I Center obtained GreenTechnology Certification for cosmetics ingredient
processing technology that uses ultra-high pressure
ginseng processing technology.
The R&I Center has carried out research on ginseng
for many years, extending the superiority and ecofriendliness of the company’s unique ultra-high pressure
ginseng processing technology in many areas, from heath
functional foods to cosmetics.
As technology simplifies the detailed steps of processing
red ginseng from extraction to concentration, the annual
electricity consumption has been reduced by 19.2%,
with annual LPG consumption down by 40%, thereby
diminishing any environmental impact that may occur
during the manufacturing process.
This technology was applied to six haircare products fromthe Ryo Cheonsamhwa line, which achieved revenue ofalmost 2 billion KRW in 2021. The Amorepacific R&I
Center will continue to develop product technology thatcan ensure superiority and marketability while taking any
environmental impact into account at the same time.

Amorepacific R&I Center

CEO Message

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Chapter 1

Chapter 2

Move Forward Together with Customers and Society

Chapter 3

AppendixBlue Movement Campaign: Habits to Reduce Our
Water Footprint in Our Daily Lives

PromotingResponsible
Consumption
through Brand
Campaigns

LANEIGE actively improves the impact of its products onwater and the environment for everyone’s sustainable
future, and preserves pure, clean water by encouraging
people to make small changes to their everyday habits. To
this end—and as part of the Blue Movement Campaign
which brings the brand and customers together—
LANEIGE first introduced the #ByeWaterFootprint!
challenge and prepared an eco-friendly kit to go alongwith it in 2021. The challenge promotes easy and valuable
environmental tips on habits that can reduce a person’s
water footprint in their daily life. The kit also consistsof a gargling cup, bamboo toothbrush, eco-friendly
handkerchief, and a tumbler bag. Daily use of the garglingcup included in the kit has the effect of reducing one
person’s water footprint by approximately 34L per day.

28

Sustainable Product Development with Customers
LANEIGE is acutely aware of the fact that there is aneed to address the concerns of millennial and Gen Z
customers who want eco-friendly elements incorporated
into products as well as packaging materials. We haveachieved this through our “Everyone’s Marketers”
program, a development process that customers arefree to take part in. Accordingly, LANEIGE has applied
sustainable elements such as recycled plastics andpaper to some of its items, whose development somecustomers directly participated in, thereby increasing ecofriendliness. We are particularly proud of LANEIGE PhytoAlexin Ampoule, as 70% recycled plastics are applied tothe ampoule container and 30% recycled paper is applied
to the product box.

LANEIGE, which provides optimal solutions tovarious skin problems that occur in the daily livesof people, is loved for its innovative and new
beauty experiences. As the core of bestselling
products such as Water Bank and Water Sleeping
Mask is hydration, LANEIGE appreciates thevalue of water and thrives to preserve water
resources first and foremost. LANEIGE reduces
water consumption in the production process,donates part of sales profit to water protection
activities, and participates in promoting valuedriven consumption to customers.

LANEIGE Blue Movement Campaign’s eco-friendly kit

LANEIGE Phyto-Alexin Ampoule

CEO Message

Brand Portfolio

Chapter 1

Chapter 2

Chapter 3

AppendixLove the Earth Campaign to Protect Ecological
Wetlands
primera has been running its Love the Earth Campaign
with the aim of protecting ecological wetlands, which
serve as the origin of life and one of the most diverse
ecosystems on Earth.

primera pursues “mindful clean beauty.”
This is working actively to coexist with nature.
The brand has developed a new identity ofCelebrating the 10th anniversary of the campaign in
2021, primera released a unique item in collaboration
with Nukak, an upcycling brand that imparts new value
on abandoned objects. The limited edition beauty productconsists of a large-size Alpine Berry Watery Cream that
restores skin to a healthier state and a DIY kit with which
you can make your own card holder using the same
waste banners found in outdoor advertisements andmuseums. Eco-friendly paper made from biodegradable
sugar cane by product was used for packaging. Throughthis campaign, 450kg of waste banners were upcycled—
rather than incinerated—which had the same effectas reducing carbon emissions by about 1.2 tonnes. In
addition, part of the product sales profit from the Lovethe Earth Campaign is being donated to the protectionof ecological wetlands, as they greatly contribute to theprevention of global warming.

containers and packaging materials to minimize
resource losses and secure recycling possibilities
throughout the production process, and to makeit easier for customers to participate in recycling.
It has also continued to propose a virtuous
cycle in which customer consumption leads
to donations for society and the environment
through the “Love the Earth” campaign over theyears.

primera × Nukak collaboration for the 10th anniversary of the Love the Earth Campaign

29CEO Message

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Chapter 3

Appendix

30

Move Forward Together with Customers and Society

Spreading the Value of Diversity and Inclusion

Building A More
Diverse andInclusive Work
Environment

Amorepacific established a diversity & inclusion policy andconducted an educational program in which employees
directly participated. As a result of this program, employees
realized unconscious biases and shared in-depth discussions
on the meaning of respecting distinction and how tomove toward in a fully accepting organizational culture.
Amorepacific will conduct a number of different types of
employee participatory programs on a regular basis by2030. This will include workshops, small meetings, ande-learning for all Amorepacific employees, regardless ofwhether they work in Korea or at an overseas subsidiary.

Promise 2
Amorepacific Diversity & Inclusion Policy
1. Respecting Employee Diversity	Every unique characteristic of an Amorepacific employee deserves
to be respected, and these individual differences will be mutually
recognized and respected.

Promote diversity and inclusion across all our global workplaces and beyond,while seeking harmonious growth with all our stakeholders.

Diversity and inclusion have emerged asimportant concerns around the world. This
includes what consumers value most andhas come to increase their demand for how
companies act and what role they adopt inpublic. To this end, Amorepacific is internallybuilding an organizational culture with a highlevel of diversity and inclusion, while externallyconducting activities such as inclusive marketingthrough its products and heightened customer
communication.

2. Zero Tolerance for Discrimination
	We prohibit discrimination of any kind on the grounds of gender(including pregnancy), nationality, regional background, race,
religion, disability, academic background, sexual orientation,
gender identity, or expression with respect to a person’s
employment, work performance, and promotion, as well as any
discriminatory behavior against legally protected minorities.
3. Providing Employees with Opportunities to Participate
	Our employees can freely voice their opinions on diversity andinclusion, and we encourage them to collaborate in uniquely
different and comprehensive ways.
4. Inclusive Marketing	We spread the value of diverse and inclusive beauty in productdevelopment and communication.

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Chapter 1

Chapter 2

Move Forward Together with Customers and Society

Amore Mall Collaborates with Disabled Artists

Beauty ProductDevelopment
and Win-Win
Cooperation
for Diversity andInclusion

Amorepacific collaborates with Bloomwork, a social
enterprise that contributes to diversity and improves
public awareness about people with disabilities. Througha collaboration initiative between Amore Mall andartists with disabilities at Bloomwork, we have designed
two types of multi-purpose tin cases with “Bloomwork
Friends” animal characters, as we believe they capture
the essence of improving people’s awareness about
disabilities. These products are sold on the basis of Amore
Mall matching every donation with the exact sameamount of money.

Chapter 3

Appendix

31

OSULLOC Jeju Green Tea Cleansing Bar produced with Donggubat

Collaborating with disabled artists at Bloomwork

innisfree Green Tea Fresh Shampoo Bar produced with Donggubat

Win-Win Cooperation with Donggubat

Two types of Amore Mall × Bloomwork tin cases

Amorepacific signed an agreement for win-win cooperation
with Donggubat, a social enterprise where more than
50% of its employees are people with developmental
disabilities. Accordingly, Amorepacific has provided
financial aid and training for building a new science labcustomized for Donggubat; support for establishing awireless management system to control product quality
for the purposes of quality certification; and assistancein preparing a quality management system for the entire
production process. In 2021, Amorepacific’s innisfree
and OSULLOC brands collaborated with Donggubat torelease a shampoo bar and cleansing bar, respectively.
Going forward, Amorepacific will continue to expand its
cooperation efforts with a wide range of social enterprises,
including Donggubat, in terms of diversity and inclusion.

CEO Message

Brand Portfolio

Move Forward Together with Customers and Society

Economic
Empowerment ofSocially Vulnerable
Groups

Chapter 1

Chapter 2

Chapter 3

Appendix

32

MEET YOUR DREAM to Support the Dreams of
Teenagers
As one of Amorepacific Group’s key pro bono activities
since 2013, MEET YOUR DREAM is a mentoring
program for women and teenagers. A group of job
experts consisting of Amorepacific employees conduct
career mentoring to pass on professional skills to young
adults and students. In July 2021, Amorepacific signed
an MOU with the Gyeonggi-do Office of Education toassume responsibility for a new Gyeonggi-do career fair
program. Starting in 2022, Amorepacific will support
career experience education in the field of cosmetics
research for middle school students in Gyeonggi-do, andexpand this kind of cooperation to provide educational
opportunities to students in educationally vulnerable
areas such as farming and fishing villages. From 2013 to
2021, 289 employees participated in the MEET YOUR
DREAM program as mentors, with 4,194 teenagers
receiving support as mentees. Since 2017, a total of 48
students have been given scholarships for the purpose of
fostering future makeup and hair professionals, of which
40 students went on to acquire a professional license in
their specific field.

MOU signing ceremony for the Gyeonggi-do career fair program

The Beautiful Life program supports customized job education and mentoring for future employment

Beautiful Life Program for the Economic Independenceof Women
From 2002 to the present, Amorepacific has made donations
to financially vulnerable women through the Community
Chest of Korea. Since 2008, it has also continued supportingthem through a designated donation channel as part of the
Beautiful Life program. Beautiful Life is a program to assist in
the economic independence of vulnerable groups of women
through employment-based customized job education &training as well as mentoring. In addition, we understand the
difficulties women face in preparing for employment and want
to help in their achieving independence from the integrated
perspective of employment and welfare services, such as familycare services and psychological counseling. Amorepacificdonated 1 billion KRW for Beautiful Life through theCommunity Chest of Korea in January 2021. A total of 325
women participated in the program that year. Throughout
2021, continuous networking and case sharing wereconducted with select organizations through the BeautifulLife program to establish and spread a female employment
support model. Amorepacific will continue to contribute to
the economic empowerment of those groups that require
economic assistance in order to realize full independence.

CEO Message

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Move Forward Together with Customers and Society

Expanding Our
Campaigns for
Healthier Lives

Chapter 1

Chapter 2

Chapter 3

Appendix

33

Makeup Your Life:A Life-affirming Makeup Training Program
Makeup Your Life is a makeup training program forcancer patients who suffer from changes in their physicalappearance, such as changes to their skin or hair loss duringcancer treatment. Since this program kicked off in 2008,
Amorepacific has delivered knowhow to over 20,000 female
cancer patients on how to beautify themselves, helping theirtransition back to everyday lives. To confirm this, follow-up
observations of participants who took part in the program
were conducted by a research team from the Cancer Education
Center and the Center for Clinical Epidemiology at Samsung
Medical Center Seoul. According to their research, self-imageof young breast cancer patients was improved through thisprogram.

In 2021, Makeup Your Life was conducted in a non-contact
livestreaming way with more than 800 cancer patients—plus
family members—in the first half of the year, and nearly 1,200
participants in the second half. At the same time, the program
has also been carried out overseas. In 2021, AmorepacificTaiwan and Hong Kong had 126 and 63 cancer patients,
respectively, in this program. Amorepacific will continue
to support cancer patients so that they can return to theireveryday lives and regain inner and outer confidence.

Pink Run Plus: A run carried out with physical distancing measures in place

Pink Run Plus:
A Leading Pink Ribbon Campaign Program
Amorepacific runs a jogging festival called Pink Run aspart of a leading program in the Pink Ribbon campaign
to improve public awareness about breast health. Since
2020, Amorepacific has held a run carried out withphysical distancing measures in place called Pink Run Plus
to promote the importance of exercise for breast health,even under the strain of COVID-19. Along with this,we launched Pink Run Plus Challenge, which was later
expanded into a global Pink Ribbon event where over
48,000 people in 164 countries ran together. 100% of theparticipation fee from the event is donated to the Korea
Breast Cancer Foundation for breast cancer surgery or
examinations for low-income patients.

Makeup Your Life: Helping female cancer patients get back to their everyday lives

In 2021, a total of 66,531 people participated in the Pink
Ribbon campaign, with 2.8 billion KRW spent on Pink
Ribbon Campaign to help female cancer patients get backon their feet with their everyday lives.

CEO Message

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Chapter 1

Promise 3

Achieve carbon neutrality and zero-waste-to-landfill
across our production sites worldwide.

Chapter 2

Chapter 3

Appendix34

Coexist Responsibly with Nature

2030 Carbon Neutrality Roadmap

Carbon Neutrality
for a Better
Tomorrow

Amorepacific recognizes the seriousness of climatechange and, as a responsible global corporate citizen, has
worked hard to reduce GHG emissions stemming from
corporate activities. Of particular note, we launched a
Carbon Neutrality Commission in 2021 that consists ofexperts from industry, academia, and top management,
all of whom collectively contributed to establishing our2030 Carbon Neutrality Roadmap to provide specific ways
to achieve the Group’s carbon-related goals.
With the aim of achieving the overarching RE100(Renewable Energy 100) goal in 2025—earlier than
the initiative’s original date—Amorepacific has been
actively joining many movements to address climatechange. Furthermore, considering the guidelines set
forth by the Task Force on Climate-Related Financial
Disclosures (TCFD), standards of the Sustainability
Accounting Standards Board (SASB), and UN Sustainable
Development Goals, Amorepacific recognizes the climatechange risks and opportunities we face and continues
taking action accordingly.

CEO Message

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Chapter 1

Chapter 2

Roadmap to Carbon Neutrality

Chapter 3

Appendix

35

2021 Amorepacific Key Achievements

Efforts to use renewable energy at all business sites
GHG Emissions
scope 1,2

18.5%

al

su
U
s
a
ss

ne

Busi

Renewable electricity consumption
50K

2025

2030

Early Transition to 100%
Renewable Energy

Production Sites
Zero GHG Emissions

Expansion of energy efficiency at production sites

22.9%
GHG emissions reduction(Compared to 2018)

0

100%

2030 Target

Converting distribution vehicles used in Korea into eco-friendly vehicles

Declaration of 100% renewableenergy at all business sites

0tCO eq Zero GHG emissions at production sites

5units

2

2019

2020

2021

2025

2030

Switching from fossil fuel vehicles to electric vehicles at the Incheon Logistics Center

CEO Message

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Coexist Responsibly with Nature

Using Renewable
Energy at All
Business Sites

RE100 is a global campaign for companies tovoluntarily declare that they will supply 100%

Chapter 1

Chapter 2

Chapter 3

Appendix

Replacing 18.5% of Electricity Consumption withRenewable Electricity
Amorepacific recognizes the seriousness of climate change
and is doing its utmost to immediately respond to thiscrisis with the aim of reaching the RE100 goal by 2025,
which would be earlier than the initiative’s original goal.
To achieve this challenging goal, Amorepacific built
additional 230kW-level micro hydropower and solar
photovoltaic power generation facilities at the R&I Centerand Amore Beauty Park, and adopted green pricing.
As a result, 18.5% of the electricity used at Amorepacificas a whole was replaced with renewable electricity, andAmore Beauty Park is prepared to replace all electricity
to be used at the business site with renewable energy in2022. In March 2022, Amorepacific signed a direct powerpurchase agreement (PPA) for renewable energy, the firsttime this had ever been done in Korea. Through this PPA,
Daejeon Daily Beauty production site will be suppliedwith 5MW of renewable energy for 20 years from thefourth quarter of 2022, and expects to reach a reductionof approximately 2,700 tonnes of GHGs annually.

of the electricity they need using renewableenergy. Amorepacific joined the global RE100
initiative on March 10, 2021, becoming the first
Korean beauty company to do so. To faithfully
take part in this campaign, Amorepacific will
replace 100% of the electricity used at all
production sites, R&I center, logistics centers,
and local business units with renewable energy
by 2025, earlier than the previously announced
target year of 2030.

Signing a direct PPA with SK E&S for renewable energy

Amore Beauty Park’s solar panels

36CEO Message

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Coexist Responsibly with Nature

Achieving Carbon
Neutrality at
Production Sites

Chapter 1

Chapter 2

Efficient Energy Management in the Manufacturing
Process
As a result of implementing GHG emission reduction
activities at each production site, GHG emissions werereduced by 22.9% compared to 2018.
For its part, Amore Beauty Park converted dehumidifying
freezers in its manufacturing and packaging rooms into
non-powered devices in 2021 to reduce the load on thedehumidifying freezers while maintaining consistentroom temperatures to ensure product quality. The
existing freezers were used for cooling when necessary. In
addition, to prevent temperature differences due to thenature of the spacious packaging room, additional fanswere installed to improve cooling efficiency. Meanwhile,
Daejeon Daily Beauty production site converted its air
compressors, which supply compressed air necessary
for production, into high-efficiency devices. It also
installed shut-off valves in each area to prevent leakageof compressed air, thereby saving energy. And AESTURA
replaced aged devices that automatically controls utilities
with new devices, while also expanding facilities to be
automatically monitored.

Chapter 3

Appendix37

Coexist Responsibly with Nature

Starting to Use Electric Vehicles at Our Logistics Centers

Converting
All Distribution
Vehicles Used in
Korea into Ecofriendly Vehicles

In 2021, five internal combustion vehicles at the Incheon
Logistics Center were converted into electric vehicles, with
two rapid chargers also being installed at the center. Thishas the effect of reducing 22 tonnes of GHG emissions
a year. In the first half of 2022, ten electric vehicles
were purchased and three additional rapid chargers
were installed, while three more electric vehicles will be
introduced in the second half of 2022. Amorepacific willcontinue to convert vehicles at its logistics centers into
eco-friendly vehicles.

In 2021, Amorepacific declared carbon
neutrality, with the aim of reaching zero carbon
emissions at all production sites by 2030.
For efficient use of energy, we were actively
introducing low energy use processes and waste
heat steam.

Electric vehicles at the Incheon Logistics Center

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Chapter 1

Chapter 2

Chapter 3

Appendix38

Coexist Responsibly with Nature

Applying Paper Packaging to Tube-type Products

Efforts to Reduce
the Unnecessary
Use of Plastics

Amorepacific is developing the necessary technology for thecustomers to recycle cosmetics containers more easily. In
2021, Amorepacific developed technology to apply paper
packaging to tube-type product containers and completeddeveloping a mass-production system.
The technology enabled Amorepacific to reduce about 70%of plastics use compared to previous containers, improving
the impact of these containers on the environment.
In addition, Amorepacific signed an MOU with new ecofriendly material developers in 2021, including Hansol
Paper, to develop eco-friendly technologies. Consequently,
we plan to develop eco-friendly containers in the future thatwill be biodegradable. We are also planning to develop a
structure that enables customers to use all of the remaining
cosmetics in the tube by improving the characteristics of the
tube structure. At the same time, we are developing raw
material technology to compost 100% of the plastics usedin paper tubes. On top of that, we will develop the necessary
technology for packaging that can be separately discharged
as paper while still meeting the highest standards of quality
and expanding the technology to various product lines.

Promise 4

Reduce the use of plastics in product packaging and create 100%
reusable, recyclable or compostable plastic packaging materials.
We are accustomed to the linear consumptionof using finite resources once and thendisposing of them. That is precisely why
Amorepacific strives to move away from linear
resource consumption and to instead achieve
circular consumption. We are achieving thisby reducing the use of new petroleum-derived
plastics in product packaging, and by designing
plastic packaging to be 100% recyclable,
reusable, and compostable.

An MOU ceremony with Hansol Paper to develop eco-friendly
packaging and raw material technology

CEO Message

Brand Portfolio

Chapter 1

Chapter 2

Enhancing the Recyclability of Containers with
Metal-free Pumps
Amorepacific is gradually increasing the number ofcontainers that apply metal-free pumps and labels,
and which are smoothly removable so that customers
can effortlessly separate and discharge used cosmetics
containers. Without a metal spring in a pump thathas been used to help dispense the product content, it
becomes easier to separate the elements of a container forrecycling. The metal-free pump was applied to skincare
products in 2021, including LANEIGE Water Bank Essence,
HANYUL Powerful Firming Serum, and HANYUL Yuja
VITA-C™ Serum. Amorepacific will continue to increase
the application of its metal-free pump to new products inthe future.

Chapter 3

Appendix

Systematic Recycling of Empty Plastic Containers

Ryo Hair Strengthen & Volume Conditioner

Amorepacific is hiking up the rate of “materials recycling”
by collecting empty cosmetics bottles and turning them into
other cosmetics containers, or upcycling them into plant pots,
benches, or artworks instead of incinerating them. Every
year, about 200 tonnes of cosmetics containers are collected
through the GREENCYCLE campaign, and we are planning
to recycle at least 100 tonnes of plastic containers withTerraCycle, a global environmental company, and GS Caltex,
an oil refiner with whom we have recently signed an MOU. In
2021, the material recycling rate of plastic bottles used in our
products and appliances reached 20% (including figures frominnisfree), and we will take this rate up to 50% by 2025.

Plastic Packaging Weight Reduction
Amorepacific uses a two-stage blow method to produce
packaging. This reduces the amount of plastics used inexisting products while maintaining the highest productquality.
In 2021, Amorepacific reduced the weight of plastics usedin containers for Ryo Hair Strengthen & Volume Conditioner
by 19.2%. mise-en-scene produced 4.12 million containers
for Perfect Serum Original after applying a reduced amountof plastics to them. As a result, a total of 110.1 tonnes ofplastics consumption was reduced by decreasing the weightof plastic containers for a total of 29 items.

HANYUL Yuja VITA-C™ Serum39

In addition, Amorepacific is researching the structures ofrefill containers by analyzing customers’ usage behavior,and is already increasing the development of containers.
In 2021, we reduced the amount of plastics used atAmorepacific by 21.3 tonnes compared to the productionof original products by replacing the existing containers ofsome products with refill containers.

A bench made through the GREENCYCLE campaign

To be more specific, from the second half of 2021 Amorepacifichas been working on a Bottle-to-Bottle project to convert usedplastic cosmetic containers back into containers.
Amorepacific will do its best as a corporate citizen that
contributes to responsible consumption and production
through active collaboration efforts with other companies andcustomers.

CEO Message

Brand Portfolio

Coexist Responsibly with Nature

Expanding theUse of Sustainable
Plastics

Chapter 1

Chapter 2

Chapter 3

Appendix

Increasing the Application of Recycled Plastics or
Bioplastics to Packaging

40

Reduced Use of Virgin Plastics in Packaging
Type

Amorepacific is reducing its environmental impact
by applying recycled plastics or bioplastics to plastic
packaging to minimize unnecessary consumption ofplastics. As a result, we reduced the use of virgin plastics
by using 124.1 tonnes of bioplastics and 340.7 tonnes ofrecycled plastics in 2021.
Amorepacific signed an MOU with Eastman, a global
specialty materials company in the U.S., to supply
chemically recycled plastics.
MOU with Eastman to supply recycled plastics

Mamonde Rose Water Toner applied with bioplastics(tonnes)

Reduction

Use of bioplastics

340.7

Use of recycled plastics

124.1

Container weight reduction
and structure renewal

110.1

Use of refill containers

21.3

Total

596.2

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Chapter 1

Chapter 2

Coexist Responsibly with Nature

Expanding Refill Products and Services

ExpandingEco-friendly
Customer Services

Amorepacific opened a refill station at the Amore Store in
Gwanggyo, the first such store in the domestic cosmetics
industry. At the refill station, customers can purchase theshampoo and body wash products they want in custommade refill containers. In 2021, a custom-made refill
container made of 100% recycled plastic was adopted so
as to offer greater choice on top of existing containers thatuse coconut byproducts.

Chapter 3

Appendix

Due to the wide recognition of its eco-friendly services
and economic feasibility with its refill station, Amore
Store Gwanggyo was named the Best Corporate Case inAugust 2021 for “revitalizing the use of zero-waste shops
and multi-use containers” by Democratic Party’s Carbon
Neutral Special Committee Resource Circulation Division.
Furthermore, Amorepacific started running a refill station
at Amore Store Hair & Body inside E-mart Jayang thatsame year. Moving forward, Amorepacific will actively
respond to the needs of customers who give high priority
to eco-friendliness.

Refilling content in a custom-made refill container

Refill station at the Amore store Hair & Body inside E-mart Jayang

41CEO Message

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Chapter 1

Chapter 2

Chapter 3

Appendix

Coexist Responsibly with Nature

Promise 5

Invest KRW 10 billion into biodiversity conservation
efforts and increase the use of RSPO-certified palm oil to 90% or more by 2023

Technologies for
the Conservationof Biological
Resources andClimate Change
Adaptation

42

MOU on ESG Management with the Korea Arboreta and
Gardens Institute
Amorepacific strives to find cooperative partners and build
friendly relations for biodiversity conservation and theutilization of biological resources. Recently, Amorepacificsigned a memorandum of understanding on ESG managementwith the Korea Arboreta and Gardens Institute, which
specializes in biodiversity research as a public institution under
the Korea Forest Service. The Korea Arboreta and Gardens
Institute is now Amorepacific’s cooperative partner for theutilization of biological genetic resources. In the future,
Amorepacific will also work alongside the Baekdudaegan
National Arboretum under the Korea Arboreta and Gardens
Institute to discover and preserve plant genetic resources thatcan be used as cosmetic ingredients.

Coexist Responsibly with Nature

Increasing the Rate of Purchasing RSPO-certified Ingredients

Supporting Palm
Oil Farms throughPartnerships
with NGOs andSuppliers

In 2021, Amorepacific used over 26,000 tonnes of palmderived ingredients, of which 41.7% was certified by theRoundtable on Sustainable Palm Oil (RSPO), a group which
had been established to prevent environmental destruction
caused by palm oil production. In addition, we recommended
our suppliers make a concerted effort to prevent deforestation,
respect the human rights of indigenous peoples, and comply
with land rights laws through our Supplier Sustainability
Guidelines. Furthermore, Amorepacific secured 100%
RSPO through the purchase of RPSO certified palm oil andthe certification of the Book&Claim. In recognition of theseachievements, Amorepacific scored the highest points (14.5)
among any Korean company in an evaluation by the World
Wide Fund for Nature (WWF) with its annual Palm Oil Buyers
Scorecard in 2021. Amorepacific will continue to carry out
practical activities regarding this issue, such as increasing thesourcing rate of RSPO-certified palm-derived ingredients.

Chapter 3

CEO Message

Brand Portfolio

Materiality
Analysis

Chapter 1

Chapter 2Materiality Analysis Process

Chapter 3

Appendix

44

Issue Analysis

Issue List Selection
We organized an issue list that focused on the latest
sustainable management global initiatives, open
information required by ESG evaluation agencies bothat home and abroad, UN SDGs, and the DJSI, as well
as issues within the cosmetics industry as a whole. The
49 selected issues were grouped into nine categories:
economy, governance, stakeholders, environment, labor,
fair operational practices, customers, human rights, andcommunity engagement. A total of 34 issues were thensingled out from these categories, specifically those whichwere closely related to Amorepacific Group and global
business issues that reflect the characteristics of thecosmetics industry.

Stakeholder Interests
Media Research
Analysis of major media articles related
to Amorepacific Group

Survey with ESG Experts
Survey on issue materiality done with
ESG strategy consultants at leading
companies in Korea

Impact on the Business
Review of Past Sustainability Reports

Analysis of each issue according toImportance to Stakeholders and Impact
Analysis of issues reported on and content
on the Business was comprehensively
in reports published over the past threecarried out to prioritize material issues.
years (2018-2020)
The material issues derived fromsaid analysis were established as key
Industry Benchmarking
management strategies in considerationof business importance and impact on
Review completed of the latest
sustainability activities of seven cosmetics the business, while also being linked tocompensation for executives.
companies in six countries

Survey with External Stakeholders
Survey with Employees
Selection of material issues related tosustainability for customers, institutional Selection of material issues related
investors, local communities, NGOs,
to sustainability management for
suppliers, and media agencies
employees

Amorepacific Group carried out a materiality

Identification of Internal Issues

analysis in order to capture a comprehensive

Analysis of ESG Committee andSustainability Management Committee
agenda, management directives, andimplemented tasks for one year

understanding of the importance tostakeholders and impact on the business inthe 2021 Amorepacific Group Sustainability
Report. In compliance with the reporting topics
recommended by GRI Standards, the analysis
comprehensively included the perspectives ofexternal stakeholders and media, domestic
and global social and economic issues, and key
issues regarding our business.

Issue Priority Decision-Making

CEO Message

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Pool of 34 Material Sustainability Issues

Chapter 1

Chapter 2

Chapter 3

Appendix

452021 Materiality Analysis Results

Governance
Ensuring the integrity of the corporate governance structure
Preventing unfair practices and corruption

Material Issues

Integrated risk management
Strengthening the BOD’s management of sustainability issues

Developing Eco-friendly Products and Services

Ethical management and compliance
Strengthening our response to global initiatives

Product Innovation and Digitalization

Product innovation and digitalization

Potential Issues

Society

Waste Management and Circular Economy

Securing human resources through job creation
Safety risk management at business sites
Developing employee competencies and maintenance/improvement ofworking conditions
Heightening labor-management communication
Securing a healthy work-life balance
Employee health and healthcare
Supply chain sustainability management
Responsible sourcing of raw materials
Fair trade practices and legal compliance
Win-win growth policy
Information and technology security
Responsible marketing and value consumption campaigns
Zero tolerance for discrimination and respect for diversity
Strengthening human rights policies
Contributing to community development
Greater CSR activities
Strengthening customer safety

Environment
GHG emissions management and reduction
Increasing energy efficiency
Managing water use and minimizing wastewater disposal
Developing eco-friendly products and services
Managing and responding to climate change risks
Reinforcing the handling/management of hazardous chemicals
Enhancing environmental management strategies, policies, and systems
Compliance with environmental regulations and responding to controls
Biodiversity protection

Stakeholder Interests

Waste management and the circular economy

Impact on the BusinessCEO Message

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Chapter 1

Chapter 2

Chapter 3

Appendix46

Material Issue Management
Material Issue Importance to BusinessBusiness Impact1)

Key Performance Results

Major Management Strategies

Target Year Related Indicators2)

Product
As customer lifestyles become more diversified and value
innovation and consumption spreads, expectations for products and services
digitalizationthat take into account personal health, taste, and interests
are rising. Personalized products and services have a positive
impact on product purchase decisions because they reflect thediverse needs of consumers while emphasizing each customer’s
distinction from others. Amorepacific Group is working hard tounderstand and embrace the unique lifestyles of customers andadapt to the ever-changing business environment. At the sametime, we are increasing our competitiveness in establishing
lifestyle businesses by actively utilizing digital technology todevelop personalized products and provide various experiences
at customer contact points. This increases the Group’s overall
revenue and has a significant impact on profit when it comes tobusiness performance.

Cost· Myskin Recovery Platform was developed to easily
measure a customer’s skin condition for a customized
solution. (Winner of an Innovation Award at the CES
2022)

Three Major Management Strategies in 2021

2025

RevenueRisk· Mind-linked Bathbot was developed as a robot solution
to analyze the feelings of a person and then create
products on the spot. (Winner of an Innovation Awardat the CES 2022)· We launched MY VITAL BEAUTIE, which immediately
became a leader in the recommendation & sales serviceof personalized health functional foods.

· Great Digital Conversion· Business Innovation· Powerful Brands

Live Your New Beauty
While expanding the realm of beauty to the entire
lifecycle of customers, we seek new ways to capture thebeauty of the mind and body so that each customer is
inspired by New Beauty to discover their own beauty
and realize a healthy and enjoyable life. Based on
advanced digital technology, we propose the bestsolutions for each individual, work alongside more
stakeholders in our line of work, and have created a
corporate ecosystem where Amorepacific’s vision is
everyone’s future.

1) Business impact: Classified from the perspective of risks based on direct, indirect, and potential corporate cost generation, revenue generation in the market, response to controls, and whether or not they meet stakeholder expectations.
2) Indicators or initiatives of the ESG evaluation agencies that deal with each specific issue

GRI 201-1
DJSI 1.9.3

CEO Message

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Chapter 1

Chapter 2

Chapter 3

Appendix

47

Material Issue Management
Material Issue Importance to BusinessBusiness Impact1)

Key Performance Results

Major Management Strategies

Target Year Related Indicators2)

Developing
eco-friendly
products andservices

Cost. We operate refill stations at Amore Gwanggyo andat the innisfree flagship store so that customers canpurchase the desired amount of a product in their own
refillable container.

A MORE Beautiful Promise 1

2030

The consumption patterns of millennials and Gen Z customers
are changing as they have a clear awareness of environmental
issues. This can also be seen through the increase in zerowaste shops and the current plogging (picking up trash while
jogging) trend. Millennials and Gen Zers have emerged as key
players in the consumer market and have a strong influence
on corporate behavior. As a result, implementing marketingstrategies that meet the high environmental consciousnessof millennials and Gen Zers is critical to securing our businesscompetitiveness. To this end, each brand’s sustainability
strategy must be established first, and eco-friendliness thenneeds to be improved throughout the product lifestyle, from raw
materials and product manufacturing to purchase, product use,and disposal. At the same time, reliable communication withcustomers should be continuously carried out by transparently
disclosing product environmental information to customers andconducting campaigns for them to participate in.

Revenue
Risk

Instill the values of environmental and social
friendliness into 100% of our new products and pursue
endeavors that encourage sustainable living.

· LANEIGE conducted an environmental habit challengethat allows customers to easily practice reducing theirwater footprint in their daily life: #BYEWaterFootprint.
· Several products, including CUBE ME Red Ginseng
Plus, utilize technology which cuts down on energy
consumption by more than 10% in the production
process and have obtained Green Technology
Certification.
· primera Skin Relief UV Protector EX was selected as
one of Korea’s Green Products of the Year 2021 as it ispackaged in a plastic-reducing paper tube and a box
made with a 100% sugarcane byproduct-based paper.

1) Business impact: Classified from the perspective of risks based on direct, indirect, and potential corporate cost generation, revenue generation in the market, response to controls, and whether or not they meet stakeholder expectations.
2) Indicators or initiatives of the ESG evaluation agencies that deal with each specific issue

UN SDGs 12
GRI 302-5
DJSI 3.10.2
KCGS 42, 45
FTSE SCR58 / SCR60

CEO Message

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Chapter 1

Chapter 2

Chapter 3

Appendix

48

Material Issue Importance to BusinessBusiness Impact1)

Key Performance Results

Major Management Strategies

Target Year Related Indicators2)

Waste
Management
and Circular
EconomyCost
Revenue. The GREENCYCLE project we run is a systematic
recycling campaign to collect used cosmetic bottles anduse them for bench production instead of incineratingthem.

A MORE Beautiful Promise 4

2030

Used cosmetic containers are not easy to recycle due to theresidue inside them, as well as the structure of composite
materials that are difficult to separately discharge and recycle.
Stakeholders, including NGOs, are strongly demanding thatcosmetics companies fulfill their environmental responsibility
related to plastic waste. Amorepacific Group deeply understands
the needs of external stakeholders on the issue of recycling
cosmetic containers and is working tirelessly on various
solutions.

Risk

Reduce the use of plastics in product packaging andcreate 100% reusable, recyclable or compostable
plastic packaging materials.

· We have increased the recyclability of containers
by using metal-free pumps so that customers caneffortlessly separate and discharge used cosmetic
containers.
· We reduced the usage rate of new petroleum-based
plastics by using bioplastics and recycled plastics.

1) Business impact: Classified from the perspective of risks based on direct, indirect, and potential corporate cost generation, revenue generation in the market, response to controls, and whether or not they meet stakeholder expectations.
2) Indicators or initiatives of the ESG evaluation agencies that deal with each specific issue

GRI 301-3, 306-1
UN SDGs 12
KCGS E14, E16
DJSI 2.8.3
SASB
CG-HP-410a.1,
CG-HP-410a.2

CEO Message

Brand Portfolio

Stakeholder
Engagement

Chapter 1

Chapter 2

Chapter 3

Appendix49

Stakeholder Engagement
Stakeholders

Communication Channels

Frequency

Key Issues

Key Response Activities

Customers· Corporate website

On demand· Timely response to customers· VOC sharing meetings for each brand/business unit

· Brand website· High-performance,· Conducted the Tiki Taka program to deliver VOC to· SNS (Facebook, LinkedIn, etc.)

high-safety products

different brand staff members

Once a year (regular),· Communication between· Conducted a program to reinforce employee

once or twice a year (simple)

organizations

abilities with content in an AP Sikgam (Amorepacific· Labor-Management Council

Once per quarter· Expanding opportunities for new

Knowledge and Sense)· In-house online communities

On demand

insights· Diversification of performance reward systems· Beauty points app· Amore Mall

, ARITAUM Mall

· Customer service center
Employees· Employee engagement survey· Safe working environment· Business commnunication platform - Workplace· Ethics Hotline· Town Hall meetings at overseas subsidiaries

For active communication across all business

Shareholders/· Annual General Shareholders’ Meeting

Once a year

· Pursuing new businesses to· Disclosure of financial performance results throughInvestors· Quarterly performance announcement conference calls

Once per quartersecure future growth engines

business reports and annual reports.

· Domestic/Overseas investor conferences and NDR

Two or three times per quarter

activities, Amorepacific Group defines six· Transparent disclosure of governance system througha corporate governance report(Non Deal Roadshow)major stakeholders: customers, employees,
shareholders/investors, local communities,· Business reports

Once a year

· Face-to-face meetings and conference calls for investors

On demand· IR website and IR main email accountbusiness partners, and the government/public· e-Disclosure systemagencies/associations, all of whom directly

Local· Local consultative meetings

On demand· Mutual growth with local· Community based problem-solving activities

and indirectly influence or are influenced bycommunities· BOD meetings of foundations

Once a year

communities(including environment improvement projects and· CSR portal site

On demand· Yongsan Dragons activities

Once per quarter

Business· Mutual growth general meetings (for each sales channel)

Once a year

partners· Win-win practice seminar and general meeting

Once a year

· Supplier survey

Once a year

· Innovation Day

Semi-annual
On demandthe company’s business activities. For eachstakeholder group, we identify and reflect
key issues in our business activities. We also
gather their opinions and do our utmost to
meet their expectations through a numberof highly accessible communication channels

Related agencies· Stakeholder dialogues

available for all the different stakeholders on a

and associations· Collaboration and support

permanent or regular basis.

· Korea Cosmetic Association meetings

spatial culture improvement projects)· Support for suppliers· Customized support for suppliers (including SHE
consulting and joint research)· Changes in government policies· Participating in decision-making processes related to· Joint sustainability actions

government policies.
· Joining associations and declaring support forimportant initiatives (including UNGC)

CEO Message

Brand Portfolio

Sustainability
SystemAmorepacific Group is establishingsustainability strategies and examining
directions for the Group to move forward in
the areas of the environment, society, andgovernance. As the highest decision-making
body that reviews/approves performance,
improvements, and selection of material issues
related to sustainability management, as wellas the publication of sustainability reports, the
ESG Committee, which falls under the Boardof Directors, actively carries out sustainability
management along with its affiliatedorganizations.

Chapter 1

Chapter 2

Chapter 3

Appendix50

Sustainability Governance
Amorepacific Group has firmly established a sustainability
system to oversee all matters related to sustainability
management. After newly creating the Sustainability
Management Division in 2018, the Group built more
systematic strategies and strengthened working
group activities with employees. By candidly making
the outcome of sustainability management accessible
to stakeholders in a transparent way, AmorepacificGroup shares the value of sustainability that the Grouppursues. In 2021, the Sustainability Committee wasconvened once, enhancing the execution of sustainability
management by reflecting key indicators on remuneration
for the performance of executives.
In April 2021, the ESG Committee was launched inside
the Board of Directors as the highest decision-making
body on sustainability. Through this mechanism, we
supervised and responded to ESG risks that included
external regulations, responded to communication with
ESG-related stakeholders, established ESG strategies
and detailed action plans, and monitored ESG-related
implementation and responded with improvements.
As of the end of 2021, the ESG Committee had met
on two separate occasions. The main results of thesemeetings were that an ESG Committee chairperson
was appointed and operation plans were established.
Furthermore, its agenda dealt with reports concerning
sustainability strategies and detailed goals for 2030,
as well as ESG performance management measuresand the Group’s response status to sustainable palmoil. The ESG Committee makes strategic decisions onsustainability and monitors the implementation of coretasks in cooperation with the Sustainability Committee, amanagement-oriented consultative body made up of top
executives.

Board of Directors

ESG CommitteeCEO· Highest decision-making body for sustainability
management· Participation of executive/independent directors· Reviews and decides on strategic directions and major
activities in sustainability management; oversees
sustainability risks and monitors performance

Sustainability Committee

Sustainability Management Division· Coordinator of sustainability management· Establishes the Group’s sustainability strategies and discovers
relevant tasks

Working Group on Sustainability Management Strategies· The agent of carrying out sustainability management tasks· Operates working groups on sustainable packaging,sustainable stores, SHE, mutual growth, and more

· Participation of top management· Decides on sustainability strategies and major activities;
monitors performance

CEO Message

Brand Portfolio

EthicalManagement

Amorepacific Group continuously reinforces
policies and behavioral principles related to
ethical management in an effort to spread its
healthy corporate culture built on “Act with
Integrity,” one of the principles under the ABC
Spirit. In addition, the Group also conducts
diverse campaigns, education, and surveys toinstill ethical awareness and carry out its Codeof Ethics for employees, all of which intend torealize its social and ethical responsibility as acorporate citizen.

Chapter 1

Chapter 2

Chapter 3

Appendix

51

Policies and Regulations for Ethical Management

Code of Ethics

Guidelines on Anti-Corruption and No Briberies

Amorepacific Group updates its business ethics andcompliance guides to respond to changes in internal andexternal policies and regulations, while also preventing
possible risks and regularly providing guides on themfor employees. As such, the Group is preventing possible
unethical and compliance risks by presenting specificbehaviors that should be followed according to situations
and jobs.

The Code of Ethics is a set of practical guidelines that allof our employees are encouraged to follow in order for
Amorepacific Group to enhance corporate transparency
and fulfill its social and ethical responsibility as a corporate
citizen. The Amorepacific Code of Ethics consists ofcontent on caring about customers, respect for employees,
management with integrity, harmonious growth,protection of company assets, and responsibilities as acorporate citizen. It presents a clear outline to all employeeson the principles of judging right from wrong in workrelated decisions and the standards of ethical behavior thatthey should observe in their private lives.

The Amorepacific anti-corruption policy aims to strengthen
trust with stakeholders and continue to grow the company
by maintaining the value of the very same integrity thathas been upheld since its foundation. Implementation
guidelines include prohibition of bribery, prohibition ofreceiving gifts and entertainment, prohibition of off-thebooks payments for expediting the business process, andprevention of any conflict of interest. To prevent corruption
and bribery, Amorepacific Group conducts regulareducation and campaigns, while also managing a bribery
reporting system and an approval process for gift certificate
purchase and use. At the same time, it operates an Ethics
Hotline so that employees and stakeholders can consult andreport on related matters. Finally, the Group continuously
keeps a sharp eye on suspicious activity connected tocorruption through internal audit activities.

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Chapter 1

Chapter 2

Chapter 3

Appendix

52

Work Ethics Guide

Conduct Guide

Live Broadcasting Guide

Reinforcement of Ethical AwarenessAs a sub-regulation of the Code of Ethics, the Work
Ethics Guide aims to create a sound corporate culture
and establish ethical management by highlighting
ethical behavior examples and work standards that
employees of Amorepacific Group should comply with inall basic job areas. This includes creating a sound work
culture, complying with laws and social norms, and theprohibition of corruption and devious conduct carried out
in self-interest.

This guide describes specific actions to implement theCode of Ethics and work ethics in detail, and serves as apromise that all employees should voluntarily uphold.

This set of guidelines for basic compliance and ethicalmarketing activities is directly connected to sales activities
of products using digital media.

Education

Sexual Harassment Prevention Guide

Conflict of Interest Prevention Guide

This conduct guide is related to the prohibition of sexual
harassment, one of the most important ethical issues toobserve as a member of Amorepacific Group.

When selecting business partners, personal interests should
be disclosed and related tasks should be fairly performed by
avoiding any conflict between the company’s interests andindividual interests.

Workplace Harassment Prevention Guide
These guidelines are meant to be followed in order tocreate a sound organizational culture in which members
respect one another while complying with all laws andregulations at the same time.

Corporate Secrets Protection Guide
In an effort to protect and manage critical internal
information to help keep the company competitive, thisguide contains all the necessary business procedures for
employees to ensure they keep corporate secrets safe.

Social Media Activities Guide
A guide to the essential legal and ethical standards ofconduct that members of Amorepacific Group should beaware of in their work and personal areas with respect tothe increase in social media activities for individuals andbusinesses.

To enhance employees’ ethical awareness, Group-wide
online education has been implemented based on the
Amorepacific Code of Ethics. In 2021, the Group reinforced
online education in three sessions: basic ethics, work ethics,
and compliance practices. Furthermore, education sessions
on ethics were conducted for new employees and expats,
while ethics education based on our social media activities
guide was given for those in charge of in-house video
content and YouTube content.

Guide for After-work Dinner Culture
These guidelines help to clearly establish values that
distinguish work from one’s private life by creating ahealthy culture of after-work dinners and to prevent
unethical problems that may arise from excessive drinking.

Gentle AP Guide (against Power Trips)
There are several key basic business manners which should
be followed when collaborating with business partners,
including suppliers and clients.

· Completion Rate of Online Ethics Education 92%· Participation Rate of Pledge for Business Ethics 100%Campaign Activities
In order to continuously inform and communicate thedirection of ethical management and ethical conduct, we
carry out business ethics campaigns on a constant basis.
Leading examples include our no gift sharing campaign toeradicate the reception of unnecessary gifts, a guide for an
appropriate culture of after-work dinners, and guides toprevent sexual harassment at work and to enable mutual
respect among employees.

CEO Message

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Chapter 1

Chapter 2

Chapter 3

Appendix

53

Amore Ethics Briefs

Communication with Overseas Subsidiaries

Reporting Process for Unethical Management

To make it easy for employees to experience theimportance of ethical management in their daily lives,a corporate ethics newsletter called Amore Ethics
Briefs is published through Workplace, an in-housecommunication channel. In 2021, we shared content
based on internal and external trends and actual cases
by dealing with personal information protection, sexual
harassment at work, and workplace harassment, raising
the ethical awareness of our employees and preventing
unethical behavior from happening again or at all.

As part of our initiative to improve the ethics of overseas
subsidiaries and prevent external risks globally, we conduct
corporate ethics programs at home and abroad. We havea firm three-year plan in place to establish a three-stepprocess of recognizing, spreading, and firmly establishingcorporate ethics from 2021 to 2024. In 2021, we selectedsubsidiaries in Singapore, Malaysia, Thailand, Indonesia,
Vietnam, Australia, the Philippines, India, the Middle East,
and China, and then began carrying out this program forrecognizing the Code of Ethics to prepare a global ethics
management system. To this end, we shared the progress
we made with corporate ethics in 2021 and encouraged
employee participation through our Corporate Ethics Letter,
which was sent directly to every employee in each specificcountry by the head of each subsidiary. In addition, throughan online ethics pledge, each employee directly confirmed
their adherence to the Code of Ethics and pledged to
implement the Code of Ethics. We also conducted various
programs to further this initiative, such as corporate ethics
campaigns dealing with major agenda and customized
training for overseas subsidiaries.

Amorepacific Group has an Ethics Hotline, an official
website for stakeholders to request ethical management
consultation and report unethical incidents, and operatesa systematic reporting and handling procedure throughcontacts for different issues, such as sexual harassment atwork and workplace harassment and through emails from
related departments. In addition, we share our content with
employees to prevent similar cases that have already beenreported from recurring.

Completion Rate of Online/Offline Education
and Participation Rate of Pledges for
Ethical Management at Amorepacific China

Amore Ethics Briefs : Our corporate ethics newsletter

90 %In 2021, we set out to investigate 100% of the 33 reports
received, including sexual harassment at work and workplaceharassment, private use of company assets, and violationof work processes. As a result, heavy punishment or light
disciplinary actions were meted out in a total of 13 cases.

Reporting of Unethical Conducts by Stakeholder Group(cases)Clients

Suppliers

Employees

Customers

Others

Total

2

2

15

2

12

33

Measures about Reported Unethical Conduct
Category(cases)Reported
Cases

Results of Measures
No Light disciplinary
violationactionHeavypunishment

Sexual harassment/Workplace harassment

8

5

1

2

Private use of company assets

7

1

5

1

Violation of work processes

7

5

1

1

Unfair transactions with suppliers/Reception of gifts

4

3

-

1

Abnormal distribution and copyright violations

3

3

-

-

Violation of outside work/Absenteeism and tardiness rules

3

2

-

1

Other failures to comply with ethical standards

1

1

-

-

Total

33

20

7

6

CEO Message

Brand Portfolio

Risk Management

Chapter 1

Chapter 2

Chapter 3

Appendix

54

Risk Management Organizations
Amorepacific Group has an effective risk management
system to respond to various risks, such as fast-changing
domestic and global political and economic conditions,fluctuating business environments, increased influenceof social media that includes social networking services
and blogs, and heightened expectations of stakeholder
demands. The Risk Management Team communicateswith subcommittees on each issue, undertakes potential
risk prevention activities, and carries out early response
measures to actual risks. To allow prompt decisionmaking and maintain stable business operations, weformed a Group-wide Risk Management Committee thatconsists of executives. Since the possibilities and impact
of global risks continue to increase, Amorepacific Groupestablished an advanced risk management system at its
overseas subsidiaries. In the future, Amorepacific Groupwill build a solid foundation for sustainable growth bygradually upgrading the risk response systems of overseas
subsidiaries.

Board of Directors

Risk Management Committee

CRO

Compliance Team· Ethical and compliance risk management

Risk Management Team· APG Risk Management Control Tower· Establish risk management policies and standards· Monitor operational risks· Perform risk assessments and establish response measures

Upon identifying the financial and non-financial
risks that may arise from its management
activities and defining the potential risks that

Identification of Sustainability Issues

are expected to have a significant impact on its
business, Amorepacific Group then responds
as necessary. We identify possible risks at all
business sites and respond closely throughmanagement organizations to minimize theirimpact on our business.

· Subcommittee on communication· Subcommittee on quality management· Subcommittee on SHE· Subcommittee on mutual growth· a R&I Unit Crisis management committee

CEO Message

Brand Portfolio

Chapter 1

Chapter 2

Chapter 3

Appendix

Risk Management Process

Risk Detection and Prevention

Risk Response Activities

The risk management system of Amorepacific Group isoperated based on the following keywords: precaution,
response and recurrence prevention.

Based on an analysis of internal and external
environments, we prioritize high-impact, high-potential
risks and establish a detection system by which we canproactively respond to key risks by identifying their causes.

To effectively manage risks, Amorepacific Group
categorizes risks identified through its risk management
process into the following six categories, and separately
manages factors that may potentially have a significant
impact on the company’s reputation as well as ethical andlegal matters.

Risk Response
Risk managers in each division monitor and report risks
pertaining to their division. A unified system enables
prompt decision-making and an immediate response in
the case of risks.

55

Market Risks· Increased global regulations on safety and environment· Diversification of customer needs· Increased possibility of major disasters and natural calamities

Product Risks· Increased importance of managing product safety and harmful
materials· Measures to prevent any recurrence of a customer complaint

Supply Chain Risks
Risk Diagnosis and Prevention of Recurrence
By following all risk scenarios and risk management
policies, we minimize the impact of risks. We also prevent
recurrence of those risks by analyzing their causes. The
Risk Management Team provides training on the risk
management system on a regular basis and carries out
various campaigns to establish a healthy and effective risk
management culture throughout the company.

· Increased importance of demand prediction and timely supply
management in accordance with changes in the market
environment· Fluctuations in the supply environment of raw materials due toexternal influences· Risk of safety accidents

Sales & Distribution Risks· Increased need for efficient management tailored specifically toeach country· Responses to changes in the regulatory environment of eachsales and distribution channel· Higher distribution costs due to inflation

Privacy Protection Risks· Further digitalization of Amorepacific’s customer services· Strengthened laws and regulations related to privacy

Reputational Risks· Risks that can have a hugely detrimental impact on thecompany’s reputation

CEO Message

Brand Portfolio

Chapter 1

Chapter 2

Chapter 3

Appendix

56

Managing Major Emerging Risks
Amorepacific Group is aware of the various potential risks that may arise in
the course of running a cosmetics business and is committed to proactively
responding to these risks.

Increased Export Costs Due to the Adoption of Carbon Border Tax by Country

Customer Changes According to Changes in the Population Structure

Global Supply Chain Disruptions Due to Conflicts between Countries

Emerging
Risks

Emerging
Risks

Emerging
Risks

The new environmental economic systems to overcome theclimate crisis is increasingly being adopted worldwide. Amongthese systems, the carbon border tax is one that requires products
from countries with low carbon emission regulations to purchasecarbon emission rights for carbon emissions generated during
the production process, as well as pay with other taxes. According
to the Korea Institute for International Economic Policy, if the
EU imposes a carbon border tax of about $36 per ton of carbon
dioxide, Korea is expected to have an additional $1 billion or morea year of this tax imposed on it. As of 2021, Amorepacific Group
exports products to numerous countries in Asia, Europe, and North
America, and there is concern that price competitiveness may
worsen due to increased production and export costs when thiscarbon border tax is applied.

Mitigating In order to preemptively respond to climate crisis-related
regulations in areas such as the EU, Amorepacific Group intends
Actions
to strengthen its environmental assessment of its products. In
2021, Amorepacific Group was the the first Korean company toparticipate in the EcoBeautyScore Consortium, a group made upof global cosmetics companies and professional associations, andis jointly developing environmental assessment methods andscoring systems for cosmetics. As we move forward, we will adopt
methodologies developed through the consortium to measure
the environmental footprint of products and develop and apply
technologies that reduce the environmental impact of eachproduct.

Korea is experiencing rapid demographic changes with theacceleration of its low birthrate and aging population. These
demographic changes have led to a decrease in the natural
population and the working population, and are likely to cause
a low growth trend in the overall population in the future. In
the case of the Japanese market, which is already dealing withan aging society, both the overall sales volume and amount ofshampoo have been gradually decreasing over the past decade. In
response to changes in the population structure (such as a decreasein the economically active population and an aging population)and customer changes(such as an increase in single-person households and active
seniors), Amorepacific Group needs to come up with ways tochange its business model and respond prudently to the issues.

Mitigating Amorepacific Group is working on ways to strengthen its
business competitiveness in markets where low birthrates, aging
Actions
populations, and population decline will intensify. We are also
developing highly functional innovative products for active seniorconsumers and accelerating research on the development ofcustomized cosmetics and health functional foods which take into
account individual skin and health conditions as well as a person’s
own preferences.

Global supply chains are intertwined in a very complex structure
which can significantly impact corporate management if
conflicts between countries disrupt certain supply chains.
Customs clearance may be delayed if the import of raw materials
is disrupted due to conflicts between countries, and have anespecially big impact on our company in situations where wehighly depend on the import of raw materials from a certain
country. Amorepacific Group imports raw materials and packaging
materials from a wide variety of supply chains and expects
a significant negative impact on its profits and losses if the
production and distribution of those supply chains are disrupted.

Mitigating To resolve issues caused by conflicts between countries,
Amorepacific Group monitors quantitative market indicators at all
Actions
times. In doing so, we are securing our price competitiveness as we
respond to changes in supply and demand by raising the level ofour reserve inventory of raw materials. In addition, we are seeking
to diversify our supply chain by raw materials while adapting to theglobal situation at the same time. Whatever the case may be, we
minimize and manage potential risks related to the supply chain of
raw materials by identifying items with potential regulations andthe degree of their risk by manufacturer as well as current trends
associated with these factors among countries.

CEO Message

Brand Portfolio

Tax Payments

Amorepacific Group complies with the tax laws
and systems of each country in which it entersand honors all payments required of it. We
recognize that compliance with tax laws andtax risk management are important elementsof our contribution to national financeand corporate ethics management, not tomention essential conditions for sustainability.
Amorepacific Group is fulfilling its taxpayer
obligations in response to the taxation
principles of each overseas subsidiary andbuilding a cooperative relationship of mutual
trust with taxation authorities.

Chapter 1

Chapter 2

Chapter 3

Appendix57

Tax Payments

Amorepacific Tax Payment Status1)

Amorepacific Group pays its fair share of taxes transparently
by complying with the Commercial Act and all laws andregulations concerned with taxes in Korea as well as allother jurisdictions in which it operates. Furthermore, weare committed to fulfilling all our tax-related obligations.
In particular, we have adopted a reasonable transfer policy
in global transactions with foreign companies that is inline with all domestic tax laws and OECD Guidelines. Also,
we do not utilize tax structures for tax avoidance and do
not transfer value created to low tax jurisdictions. Whatis more, pursuant to the Base Erosion and Profit Shifting(BEPS) Action Plans for the prevention of tax evasion ofmultinational companies, we submit an annual BEPS report(Master file, Local file and Country by country report).
Through these activities, the headquarters and overseas
subsidiaries are committed to fulfilling their obligations
to pay their taxes in full compliance with the relevantlaws and regulations. For important tax reporting affairs
or any ambiguity in interpreting tax laws, the company
receives consultation from external professionals, such asaccounting firms, for best response measures and how best
to minimize tax-related risks in advance.

Category

We neither employ a tax structure that has no commercial
practicality nor abuse the differences and loopholes in the
tax systems between different countries to unreasonably
reduce our tax liabilities. We legally allocate taxable income
depending on values generated in each country where we
operate our business. Specifically, we prohibit the transfer
of values, including intangible or financial assets, to any
region with a questionable tax jurisdiction, such as thosewith low effective tax rates. We also stringently restrict theuse of tax havens. Finally, we examine these rules throughthe Board of Directors and closely monitor the status of all
tax payments associated with the company.

(million KRW)Tax Payment Status by Tax Jurisdiction3)(million KRW)

2020

2021

Category

25,293297,877

Korea

35,087

Reported Taxes

3,424

117,020

China (Mainland)

9,069

Cash Taxes Paid

104,118

17,546

Vietnam

749

Malaysia

587

Japan

552

Thailand

464

USA

410

India

3

Earnings before Tax2)

1)	The difference between reported taxes and cash taxes paid has to dowith specific matters such as M&A or requests for correction. In the
Audit Report’s Consolidated Statements of Financial Position, see
the Consolidated Statements of Comprehensive Income and theConsolidated Cash Flow Statement.
2) Net income before tax expense

Income Taxes Paid3)	Excerpts from the Country-by-Country Report (CbCR) is mandatory tosubmit once a year to the National Tax Service in accordance with the
Adjustment of International Taxes Act (as submitted in 2021). There wereno unpaid corporate taxes, except for corporations whose tax payment
date had not arrived yet.

CEO Message

Brand Portfolio

Sustainable
Products andValue-oriented
Consumption

Chapter 1

Chapter 2

Chapter 3

Appendix

Sustainable Product Management

Environmental Improvement of Packaging Materials

Products with Less Environmental Impact

Product Lifecycle Assessment

Amorepacific Group makes every effort to build a virtuous
circle system of packaging by minimizing unnecessary
plastic consumption and promoting the recycling andreuse of plastic packaging.

Sustainable Paper Packaging

Amorepacific Group measures the environmental impact
throughout the entire process, from the extraction of
raw materials and processing through to the product’s
manufacture, distribution, and use all the way to its
recycling or final disposal. Based on the results, we areworking hard to expand the management of the entire
product lifecycle to improve our products in a direction of
reducing the environmental impact. Sulwhasoo Essential
Comfort Balancing Water and Sulwhasoo Essential
Comfort Balancing Emulsion obtained Product Carbon
Footprint(PCF) certification, which verifies that the
product’s carbon footprint has been measured and thatthe brand is working to reduce carbon emissions, while
LANEIGE’s Water Bank product line obtained Carbon
Trust Product Water Footprint (PWF) certification fromthe Carbon Trust in the U.K.

· Replace plastics with other materials· Remove unnecessary plastics

REDUCE· Use lightweight plastics· Develop new types of packaging· Expand the application of reusemodels for containers

Goals and Achievements in the Sustainability of
New Products

sustainable products, Amorepacific Grouprevised its Sustainable Product Development
Guidelines in 2019 and defined a total of
21 sustainable product types. Based on this,research and development, marketing, design,and packaging development sectors discuss ways
to ensure product sustainability, right from theearly stages of product development planning,
and apply them to new products.

As a consumer goods company, Amorepacific Group works
hard to fulfill its responsibility in minimizing the negativeenvironmental impact of product consumption, increase
the positive social impact, and help customers contributeto solving environmental and social problems throughconsumption. Amorepacific set a goal of implementing
at least one aspect of sustainability for 100% of its new
products by 2030. In 2021, 88.0% of Amorepacificbrands’ new products and 73.8% of Amorepacific Groupbrands’ new products realized one or more sustainability
attributes.

Amorepacific Group uses FSC-certified paper and paper
made from plant by-products to produce paper boxes
used in the secondary packaging of products. Our brands,
including Sulwhasoo, LANEIGE, Mamonde, HERA,
primera, IOPE, and HANYUL, use FSC-certified paper inmore than 338 products. primera actually uses boxes madefrom sugar cane bagasse for the brand’s new product,
Prime Recovery Double Capsule Serum, while innisfree
uses boxes made from green tea by-products and recycled
pulp for its new products, including Black Tea Youth
Enhancing Skin.

Improving the Resource Efficiency of Packaging
Materials· Design packaging materials with ahigher recyclability rate
· Expand recycling and the use of bio-In order to expand the development of

58

plastics

RECYCLE· Improve quality competitiveness ofrecycled plastics through cooperationin and between industries· Qualitative and quantitative growthof reverse collection of containers

Amorepacific Group is now using recyclable, plant-based
plastic or plastic materials that include recycled raw
materials for the production of plastic packaging. In 2021,
the Group used plant-based plastic in a total of 11 new
products for brands such as mise-en-scene, Mamonde,and ETUDE. In addition, we improved resource efficiency
by applying recycled plastic to over 25 products for brands
including HAPPY BATH, IOPE, primera, and innisfree.

through the GreenCycle campaign

Products Applied with a Low-energy Emulsification
MethodWhen manufacturing emulsified products, AmorepacificGroup defines products that reduce energy use in theheating and cooling process of water and oil parts by morethan 20% compared to the general process as products
applied with a low-energy emulsification method . In
2021, 26 new products were manufactured with a lowenergy emulsification method.

CEO Message

Brand Portfolio

Chapter 1

Chapter 2

Chapter 3

Appendix

59

Sustainable Palm Oil

OSULLOC’s Refill Service and Eco-Friendly Products

HANYUL Releases an Eco Pouch and Beneficial Container

Improved HAPPY BATH Containers and Pumps

Amorepacific Group is deeply aware of the environmental
issues caused by the reckless cultivation of palm
plantations. Through compliance with the RSPO
certification system, we support the use of sustainablepalm oil and continue to purchase more sustainable palm
oil without damaging forests. In 2021, about 41.7% of thepalm-derived raw materials used by Amorepacific Group
were purchased as RSPO-certified raw materials. Also, weare planning to have 90% of our primary commodities be
RSPO-certified raw materials by 2023.

The tea brand OSULLOC provides refill services in small
quantities for its loose leaf tea products at OSULLOC
Teahouse Bukchon in order to reduce plastic usage.
Furthermore, in collaboration with Hansol Paper, thebrand’s materials for loose leaf tea pouches have beenchanged from conventional aluminum to paper andbiodegradable resin. OSULLOC is working hard to fulfill its
responsibility in coping with climate change by converting
disposable materials used in stores from plastic to paper,and using recycled plastics in product containers.

HANYUL, a brand that conveys the benefits of nature
to skin and one’s daily life, launched an Eco Pouch set
in collaboration with the travel wear brand RAWROW.
Instead of a box, we put the products in a pouch made ofrecycled yarn so that customers can continue to use thepouch when traveling. Moreover, HANYUL is continuingwith its sustainability activities by releasing a “beneficial
container” that has reduced plastic usage by 93.5%
and donating some of the profits from the sale of thisproduct to the World Wide Fund for Nature (WWF) Korea
headquarters.

The total body care brand HAPPY BATH strives to reduce
its environmental burden by using easy peel shrink film,
making it easy to sort and discharge product containers,
and applying plant-based plastics. Specifically, zero-metal
pumps and recycled plastic containers were applied to all
five bestselling Essence Body Wash line products so that
customers can participate in eco-friendly consumption
just by using the products. HAPPY BATH will continue toapply recycled plastics and vegan certification proceduresto new products released in the future.

Declaration to Ban Animal Hair Brushes

Vegan-certified Products Released through CUBE ME

On January 1, 2022, Amorepacific Group established apolicy to ban the use of natural animal hair brushes andstopped all new production and orders for the products.
This is a policy to reduce animal pain and abuse caused by
the development of products that utilize natural animal
hair, and it has been applied to all our products, such asembedded brushes and promotional brushes, as well asbrush-only products.

The inner beauty brand CUBE ME has launched vegancertified products to prevent the reckless use of animal
ingredients and animal testing. CUBE ME Diet line
products gained vegan certification by using 100% plantbased ingredients and excluding any animal testing. CUBE
ME will also go through the vegan certification process for
its Waterplus line and make efforts to invigorate veganoriented marketing.

VITAL BEAUTIE’s FSC Certification Mark and Ecofriendly Perforated Lines
VITAL BEAUTIE, an inner beauty brand, attached FSC
certification marks to packages of some items using
FSC-certified paper, and always strives to extend thecertification to all its products. At the same time, it
has reduced plastic usage by changing the container
size of its core product, Meta Green, to a smaller size
than previously used. On top of reducing the size of thecontainer, eco-friendly perforated lines were applied to the
product packaging to enhance the ease of separation anddischarge.
HANYUL Eco Pouch Set

HANYUL’s Beneficial Container

CEO Message

Brand Portfolio

Chapter 1

Chapter 2

Chapter 3

Appendix

Products with a Greater Social Impact

BeREADY: Save the Heroes

Spreading Value-oriented Consumption by Brand

Using Raw Materials from Beautiful Fair Trade
Agreements

BeREADY, Amorepacific’s makeup brand for men,has continued with its Save the Heroes campaign tolook for hidden heroes in society who face uniquely
challenging difficulties, donating 5% of the brand’s sales
profit. In 2021, we donated special rescue equipment
to the Gangwon Fire Headquarters’ mountain rescue
team, as Gangwon-do has higher mountains than otherprovinces in the country and has a higher number ofrescue operations every year. In addition, BeREADY is
working with STROL (a select shop for men) to promotea positive perception of the brand by releasing campaign
merchandise inspired by mountain rescue equipment.
BeREADY will strengthen its identity as a makeup brandby enhancing the relationship between campaign
activities and makeup in the future.

LABO-H and Olive Young Beauty Cycle Campaign

Amorepacific Group pursues mutual growth with local
communities by using raw materials purchased through“Beautiful Fair Trade” agreements and creates productswith locally produced ingredients. In 2021, a numberof Amorepacific Group’s brands, including Sulwhasoo,
Amorepacific, IOPE, HANYUL, and Mamonde, used
ingredients purchased through the Beautiful Fair Trade
program for 26 new products. By using trustworthy
ingredients, Amorepacific Group has clearly demonstrated
to customers not only the range of its high-quality
products but also how it contributes to local communities
through fair and proper trade.

The scalp skincare brand LABO-H is committed tobuilding a sustainable relationship between customers
and brands through brand activities that take into accountboth the environment and ethics. In 2021, LABO-H
participated in the health and beauty store Olive Young’s
empty bottle collection campaign as a pilot brand project.
LABO-H strengthened its brand awareness as a clean
beauty brand by collecting empty bottles at Olive Young’s
29 major stores nationwide.

have been amassed through the campaign, totaling 1,105
tonnes of plastic and glass materials. This is equivalent toplanting 10,157 pine trees and reducing carbon dioxideby 1,418 tonnes. What is more is that the campaign was
reorganized by introducing an “empty bottle frequency”
program to the campaign in 2021. For its part, innisfree
renewed its “upcycling store,” which provides customers
with a variety of sustainable experiences. In fact, thebrand allows customers to watch the entire process ofupcycling production and conducts classes on the subjectof sustainability in which they can directly participate.

primera’s Campaign to Contribute to a Virtuous Circle
AESTURA’s Support for Medical Staff Related to
COVID-19 and a Communication Platform
Dermacosmetics brand AESTURA donated 10,000 units of
its ATOBARRIER cream and lotion to care for skin barrier
damage caused by the long-term wearing of masks bymedical staff working at COVID-19 screening clinics.
Based on 3,000 clinic and hospital clients that serve as
precious partners for the brand, AESTURA also provided a
digital platform where dermatologists and customers cancommunicate, providing a communication experience toconsult on and solve their skin health concerns. AESTURA
will continue to expand interactive communication
opportunities between customers and doctors to secure
AESTURA’s differentiated brand identity.

innisfree Upcycling Store Renewal and Empty Bottle
Collection Campaign

BE READY merchandise vending machine60

The eco-conscious beauty brand innisfree has been
conducting an empty bottle collection campaign to gather
used cosmetic containers, recycle them, and provide
beauty points to customers who participate in the activity.
Over the past 11 years, approximately 33 million bottles

The clean beauty brand primera is running a Love theEarth campaign designed to protect ecological wetlands.
Celebrating the 10th anniversary of the campaign
in 2021, primera released a limited edition item incollaboration with Nukak, an upcycling brand. The item
includes a DIY kit with which you can make your own
card holder using the waste banners included in the kit.
The campaign saved approximately 1.2 tonnes of carbon
emissions and donated part of the product sales profit toprotect ecological wetlands. Furthermore, primera has
run its Let’s Love campaign since 2013 to support the
dreams of girls who live in less advantageous conditionsin India’s Jamui district. Using part of the profits from thesales of primera’s Mango line products, mango saplings
are donated to families with girls for their income
generation. primera strives to exert a positive influence
right from the stage of purchasing raw materials.

CEO Message

Brand Portfolio

Implementing a
Great Workplace

Chapter 1

Chapter 2

Chapter 3

Strengthening Professional Job Competency

Strengthening Digital Competency

To enhance the competencies of all employees, AmorepacificGroup offers a variety of educational programs. We willcontinue to carry out various programs to strengthen
leadership, secure global competitiveness, promote ourcorporate culture, and reinforce professional job competency.

Based on the principle of working around the needs
and wants of customers, Amorepacific Group supports
all employees so that they work based on a clear
understanding of customers.

In an effort to strengthen its employees’ digitalcompetency to respond to the rapidly changing online
market, Amorepacific Group is equipped with rigoroustraining courses. By offering basic courses that can beapplied to concepts and work practices successively, we
have increased learning effectiveness. In addition, courses
in different areas, such as SNS advertising, search engine
strategy establishment, and UX/UI, are opened every
month for a wider choice of subjects. Moving forward,
Amorepacific Group will adopt a content provider (CP)that reflects learners’ needs and trends in the future toprovide more diverse learning content.

Amorepacific Group offers training programs to help all
employees better understand the Group’s business andvalue while gaining leadership experience at the sametime. Specifically, we provide information on internaland external trends and business insights through our AP
Sikgam (Amorepacific Knowledge and Sense) program byinviting speakers to deliver lectures. As such, we have laid thefoundation for every employee to grow into a professional
leader. What is more is that we conduct leadershipreinforcement programs for employees with numerous roles,
including new employees and new team leaders, to create aculture in which in-house members can cultivate their own
competencies and continue to grow.

education and improves organizational culture inTraining Cost and Hours per Person (Domestic)
Categoryand enhance their work engagement. We always
aim to do our utmost in creating a sustainable
working environment with efficient working
methods, fair performance assessments, andcustomized support mechanisms for employee’s
well-being.

Amorepacific Group

Amorepacific2019 2020 20211) 2019 2020 20211)

line with the changing times in order to support
the development of employees’ competencies

61

Employee Education and Training Status

Strengthening Leadership

Amorepacific Group provides a wide range ofAppendixTraining Cost
per Person(10,000 KRW)

67.5 60.1

36.2 71.4 68.5

38.0

Training Hours
per Person(Hours)53.6 65.5

30.0 56.7 71.4

33.71)	Due to the transition to non-face-to-face education because of COVID,
education investment costs decreased while actual education hours also
decreased under the influence of modularized curriculums.

In particular, we operate training programs to strengthen
the capabilities of employees in marketing, sales, andbeauty jobs that are directly related to the face-to-facecustomer experience. In 2021, the Group carried out
a Customer Data Analysis for Marketers course and a
Creating Customer Value through Sales Storytellingcourse, allowing employees to choose which—or both—of the courses they wanted to take and learn fromautonomously.
Amorepacific Group will continue to expand training
programs that enable its members to become experts intheir respective jobs and create new business value in theprocess.

AP Beauty Academy
Amorepacific Group provides practical beauty professional
training tailored to the needs of its employees and helps
improve their beauty capabilities. Thus, the AP Beauty
Academy provides new beauty education for Amorepacificemployees based solely on the meaning of beauty andeducation as pursued by Amorepacific as well as businessarea analysis. This training provides all the beauty-related
content and practical knowledge and skills that can beapplied directly to work. AP Beauty Academy members areprovided with customized courses by beauty professionals
inside and outside the company and can experience
myriad learning processes through online/offline learning
units and Course Kit classes.

CEO Message

Brand Portfolio

Chapter 1

Chapter 2

Chapter 3

Appendix62

AP+ Digital Academy Overview

Organizational Culture

Expanding Daily Experiences Related to the ABC Spirit

Amorepacific Group operates an annual AP+ Digital
Academy to enhance the digital capabilities of all its
employees, including digital workers, and offers different
kinds of courses that directly help them at work.

Since the re-announcement of corporate values being
focused on implementation in June 2020, the Group has
tried various internalization activities to establish the ABC
Spirit as Amorepacific’s signature way of working. In a
bid to strengthen employees’ awareness of the ABC Spirit
and have them put it into practice voluntarily, we focusedon everyday experience and practical changes throughthe ABC spirit to enable step-by-step understanding andexpand each employee’s experience related to this verysame spirit.

We have developed several participatory programs tospread the ABC Spirit culture. Designed to provide a venue
for communication, the ABC Spirit Journey is a series ofcampaigns that provides opportunities for employees
to easily participate in through their daily activities andto share the principles of the ABC Spirit with others. We
also run AP Pride, a praise system between employees
to constantly recognize leading ABC Spirit practitioners,
and have launched a program called HAY (How About
You?), which is a meeting of employees to communicate
their thoughts and experiences as they practice the ABC
Spirit. At the meeting in 2021, participants took part ina discourse on the theme of “Accepting and Respecting
Differences.” Later, in December, we held an ABC SpiritAwards ceremony and selected the winner of the Best
Empathy Award for the year.

Level

TargetProgramCourse Title
Digital Area

BIZ+

Leading

Digitalworkers
Work+

Applying

Understanding

Data Analysis Area

Online/Offline Study Groups for Strengthening the Digital Business
GA utilization

Excel utilization

Digital service planning

R utilization

Advertising on Facebook & Instagram

Understanding R

Planning/Producing video content

Python utilization

Naver search engine advertisement execution-Basic

Tableau utilization

Almost 550 online courses, including IT programming,
UX, UI, digital marketing, work process automation (Inflearn.com)
Allemployees

Capability+

Marketing Capability +Sales Capability +Data Analysis Capability +Customer-oriented strategies

e-Retail

Data analysis to verify effectivenessContent optimization

Influencers

Data analysis to forecast the futureOmni-channels

e-Commerce

Basic data concepts

Strengthening ABC Spirit AwarenessWe have spread our understanding of the ABC Spirit byposition—from individual employees to team leaders
right through to executives—and established theprinciples of working for each unit. To be more specific,
through our unit culture session, we have strengthened
the relationship between our business and the ABC
Spirit, while also creating an environment for everyone
to put the ABC Spirit into practice. The ABC Spirit
Practice Guidebook, titled Connection, was produced
for employees to use at any time, and through a session
led by a team leader (88% participation), members’
understanding of the ABC Spirit was enhanced andteam-unit principles of working were firmly established.
Amorepacific will continue to expand ABC Spirit educationand experience programs to help discuss ways to develop
its organizational culture.

CEO Message

Brand Portfolio

Chapter 1

Chapter 2

Chapter 3

Appendix63

Engagement Survey

2021 Engagement Survey Results

Fair Performance Assessment

Amorepacific Group is focused on enhancing value-based
engagement by regularly assessing employees’ work
engagement status. The existing engagement survey has
been revised into a Culture Survey to assess not only work
engagement of employees but also the internalizationlevel of the ABC Spirit practice. Based on these results, each
unit develops and operates its own organizational culture
improvement program.

As a result of the Engagement Survey in 2021, the response
rate of employees increased by 5% over the previous year,
to 79.4%, and the engagement rate increased by 2.4% over
2020, to 45.5%. The percentage increased both at home
and abroad. A careful analysis revealed that the company’s
strengthening of communication with and care for
employees during the COVID-19 pandemic played a positiverole in the increase.

Amorepacific Group set the direction of change andadopted a new personnel system in 2021 to support its
employees with working methods based on the ABC Spirit.
For performance management, we broke away from thetraditional result-oriented personnel system, making it more
flexible and practical to focus on improving performanceand developing competencies based on feedback from other
employees.

Engagement Survey Process

Engagement Survey Results

Category

Description

Category

2019

2020

2021

Support for Health and Well-being

Survey Model

Focused on key factors that are influential in

Revisionengagement and can be improved by leaders inAmorepacific Group

45.5

43.1

45.5

Category

40.4

43.1

Stress Management · AP-Severance Clinic: Autonomic nervous system testing (stress test) and mental health clinic

the workplace
Changed the survey target from “company” to“employees” to directly assess the emotional
state of employees
Strengthened the link between engagement
and organizational culture by assessing the levelof internalization of the ABC Spirit practice
Culture Survey

Survey on full-time employees who have

Implementation worked for more than two months at any of theGroup’s global subsidiaries

Women
Men

48.2

49.7

37.5

39.0

Women

34.1

35.3

Men

43.7

44.7

Amorepacific

41.5

Healthy Working

Physical Health

Rapid detection of changes in employees’

Supporting
the Health of
Employees

Flexible Work

99.5

Rate of Multi-source Assessment

75.2

Comparative Analysis between
Same-level Positions

47.1

Key Programs· Management of lighting, noise, air quality, humidity, and temperature to create an ergonomic working environment· In-house fitness centers and healing facilities· AP-Severance Clinic· General practice, gynecology, and otolaryngology· Vaccination, nutrition counseling, and physiotherapy and manipulative therapy facilities for musculoskeletal treatments· A system in which working hours are allocated by individual employees autonomously within an average of eight hours a
day on a monthly basis

Remote Work

· A system whereby each unit freely designs remote work standards after considering different work characteristics andworking environments to ensure the safety of its members as a result of the pandemic brought on by COVID-19

Part-time Work· Working hours can be reduced for family care, self-health, retirement preparation, and study(15-30 hours per week)

Monitoring and feedback on the effectiveness oforganizational culture improvement activities

Rate of Goal Setting· Post-examination care service for employees with potential health risks· Follow-up healthcare through the AP-Severance Clinic and local healthcare institutions· Participation rate of employees with potential health risks in the post-examination care service: 30.8%

Implementation awareness with key indicators and issue areas ofa regular survey

Rate

Training

Providing improvement solution guides andPulse Check

Category

Environment

discuss feedback and improvement issues basedorganizational development programs(%)· Happy Life Consulting: Psychological counseling services operated both through meetings and calls

Implementing a culture session for leaders to
on survey results by unit

Types of Individual Performance Assessments
for Amorepacific Employees

Lactation Spaces· Installation of a lactation space inside the women’s lounge at each business site

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Brand Portfolio

Support for Pregnant Women and Parents
Amorepacific Group operates a Care for Expectant Moms
program to create a working environment better suitedfor pregnant women. The program promotes shortened
working hours, prenatal testing during working hours, andcompliance with avoiding excessive working hours. The
program also provides ergonomic chairs, footrests, andradiation shielding blankets to help relieve any physicaldiscomfort pregnant women may be feeling, as well as
stretch mark creams and supplements for pregnant women
to stay healthy. Furthermore, we encourage the parents ofnewborns to take advantage of parental leave. At the sametime, we operate on-site daycare centers at Amorepacificheadquarters, Amore Future Park, Amore Beauty Park, and
our R&I Center. The Group also offers flexible working hours,
enabling employees to freely set communing hours within
a 40-hour workweek (standards working hours), as well as
shortened working hours during the early years of parenting.
On top of that, the Group implements maternity and parental
leaves and pay systems according to the laws and regulationsof each respective country we operate in.

Chapter 1

Chapter 2

Human Rights
Management

Amorepacific Group endorsed the UN Global
Compact in 2007 and fully respects the

Parental Leave Status (Domestic)
Category

Amorepacific Group

Amorepacific2019 2020 2021 2019 2020 2021
Number of Employees

321

455

425

273

383

357

Universal Declaration of Human Rights andthe recommendations of the National Human
Rights Commission of Korea. Additionally, weUsing Parental Leave

have established and publicly announced our(persons)

own human rights policies, which reflect our

Return-to-work Rate

96.4 93.1 97.9 97.3 92.5 97.5

After Parental Leave (%)
One-year Retention
Rate After Returning toWork (%)

commitment toward respect for human rights,
while promoting the implementation of human

81.4 91.4 93.5 80.2 91.2 81.1

rights management not only in our subsidiaries
but also in the overall value chain.

Chapter 3

Appendix64

Human Rights Inspection Process
The process of the human rights inspection conducted in
2021 included our employees as well as not only women,children, and local residents living near each businesssite but also the supply chains themselves. Human rights
impact assessments were conducted through written
surveys (Korean and English) and pre-planned onsite inspections. As a result of the assessments, there
were no issues that were considered high-risk to target
stakeholders connected to Amorepacific Group. For major
issues that we believe are potentially dangerous, wehave established tasks that fit the content of the issues
and delivered them to the business sites where each task
should be implemented.
Amorepacific Group also considers human rights issues
when identifying risks in business operations and forming
new business relationships. We examine whether humanrights related to forced labor, human trafficking, childlabor, freedom of association, qualification for collective
bargaining, equal pay, discrimination, and consumers’
human rights, as well as environmental rights in thecommunity, are guaranteed, and then deploy our
employees in charge of each field, including outside
experts, to implement relief measures when necessary.
Moreover, our Ethics Hotline , an ethics complainthandling channel, is operated in Korean, English, andChinese. Amorepacific Group faithfully fulfills its humanrights inspection obligations as well as prevents potential
human rights violations by monitoring the humanrights inspection process for stakeholders related to theGroup once a year and constantly communicating withstakeholders.

4) Post-monitoring andcontinuous stakeholder
communication

1) I dentify targets andhuman rights issues

4

1

3

2

3) Take measures to mitigate
problems and improve
human rights

2) Design an impact
assessment method

CEO Message

Brand Portfolio

Chapter 1

Chapter 2

Chapter 3

Appendix65

Human Rights Risk Assessment Results by Stakeholder
TargetKey Concerns in the Area
of Human Rights

Task

Issue Description

Corrective Measures Taken

Number of Business Sites
That Implemented Tasks

Employees

Forced labor

Human rights self-inspection

Comprehensive examination of labor and human rights issues,
including the Labor Standards Act, pay, and non-discrimination
principles· Provided labor-related education and training; derived improvement
measures on freedom of association

11 subsidiaries, including
AmorepacificMental/Musculoskeletal
healthWe Care Health program

Increased risk of mental health of employees caused by depression
due to COVID-19 and job stress, and the possibility of musculoskeletal
diseases due to activity constraints·P rovided real-time, live health & wellness programs that can be participatedin without workplace (space) constraints

All business sites

Children·P revented related diseases through the Musculoskeletal Management Center
that opened via industry-academic cooperation with Yonsei University

Freedom of association/collective bargaining

Collective bargaining

Collective agreement required when a labor union is formed inaccordance with labor-related laws

· Concluded collective agreements every two years in accordance with laborrelated laws and trade union agreements; implemented agreements inaccordance with the collective agreements

All business sites

Discrimination, equal pay

Need to improve employee
awareness about diversity andinclusion

Need to improve employee awareness about diversity and inclusion· Declared diversity and inclusion policies at Amorepacific GroupAll business sites

Child labor, human trafficking

Identifying the current statusof child labor at home andabroadIdentifying the current status of child labor· [Domestic] Minimum age of employment (15 years old) as stipulated by the
Labor Standards Act; no such employment by the Group (currently no jobs orpositions for minors)

All business sites· [Overseas] Confirmation of no children employed in a single job category

Customers

Protecting consumers/humanrightsResolving consumer disputes

Responses related to any incurred damage to customers· Conducted real-time consultation and Q&A on customer quality VOC
All business sites
integrated response service (about side effects, inconvenience in use, etc.); VOC
system and DB management, customer claim analysis; collection & inspectionof problematic items

Local
Communities

Obligation to protect
environmental rights

Osancheon Ecological Stream
Creation ProjectProtecting the environment in Osan (home of our production site)· Carried out the Osancheon Ecological Stream improvement project

Amore Beauty Park

Supply Chain

Responsible supply chain
management

Supplier Sustainability
Assessment

Identifying the current status of labor at suppliers· Requesting suppliers to establish improvement plans for workers’ grievancehandling systems

18 suppliers

CEO Message

Brand Portfolio

Chapter 1

Chapter 2

Sexual Harassment Prevention Education

Education to Improve Disability AwarenessAmorepacific Group conducts sexual harassment
prevention education to prevent sexual harassment in theworkplace. In May 2021, the Group ran its regular online
education on sexual harassment prevention. In December,additional courses were held for new employees and thoseTo broaden the value of living together and improve theperception of employees with disabilities, AmorepacificGroup conducts education on the improvement of
disability awareness. In June 2021, the first regular online
education session was held. For new employees and those
who did not complete the session, an additional session
was held in December 2021.

who did not complete their previous courses.

Chapter 3

Appendix

Establishing a Trustworthy Labor-Management
Relationship
For the past 29 years, Amorepacific has maintained a
dispute-free labor-management relationship by building
mutual trust and communication. Amorepacific and every
subsidiary carry out self-inspections of work conditionsat least once a year. Amorepacific’s Labor-management
Cooperation Team and HR Team provide active support
to areas that need improvement from inspection results.
As of the end of 2021, the Amorepacific Labor Union
consisted of 2,176 members, which accounts for 68.4%
of the 3,181 employees eligible for union membership.
Employees are entitled to freely join or withdraw from theunion, with the biennial collective agreement applying
to all employees. The Amorepacific Labor-Management
Council holds meetings each quarter, and this serves asa forum to discuss employee welfare, handle grievances,examine safety management, and look into other ways
to achieve mutual growth. On top of that, labor andmanagement are constantly in communication with one
another through various non-regular communication
channels, such as management briefing sessions, businessplan sharing, and union member meetings.

66

CEO Message

Brand Portfolio

Safety and Health

Chapter 1

Chapter 2

Chapter 3

Appendix

67

Safety and Health Goals and Performance Measurement
Amorepacific Group works tirelessly to ensure the safety and health of its employees by creating a safe working environment.
In February 2022, a new safety and health management policy was established that all Amorepacific workers must comply with.
We have established and now operate quantitative goals to achieve zero serious accidents and identify/improve risk factors.

Amorepacific Safety and Health Goals

Safety and Health Performance Measurement Process

1 	Zero occurrence of serious industrial accidents andserious civil accidents (public facilities)
2

Zero violations of Amorepacific Safety Rules1)

Monitor performance results compared to each businesssite’s goals (quarterly)

3 	Achieving 100 points for the workplace safety andhealth operation index

Report performance results for each business site to the
Safety and Health Management Committee(semi-annually)

Feedback on improvements based on performancemeasurement results

Implement improvement measures by each business site
(immediately)

To establish a safe working environment,
Amorepacific Group conducts a number ofactivities to preemptively derive the source

Reflect management reviews when setting safety andhealth goals for the next yearof and correct harmful or dangerous factors
at its business sites. In order to respond to	Amorepacific Safety and HealthManagement Policy2)·	Ensuring safety is the number one principle we arecommitted to protect in all our business activities.
·	Amorepacific is dedicated to creating a safe work
environment to ensure the health and safety of all
members.
·	Amorepacific complies with all relevant
occupational health and safety laws as well asinternal safety policies.
·	Amorepacific provides continued training
and education on safety and health and all
Amorepacific members shall actively participate inactivities ensuring a culture that prioritizes safety.
·	Amorepacific shall regularly establish objectives
and goals to make continued improvement aswell as implement reviews and improvement
measures.

global SHE (Safety, Health, Environment)risks and regulations, we adopted the Group’scommon advanced management standards
and established SHE standards and a SHE
compliance audit system to monitor, evaluate,
and continuously improve SHE conditions.

1)	Amorepacific’s internal safety standards reflect the characteristics of
the unit (industry and type of work) for the purpose of preventing safety
accidents.

2)	The Amorepacific Safety and Health Management Policy has been
approved by the CEO

CEO Message

Brand Portfolio

Chapter 1

Chapter 2

Reinforcing the Organization for Corporate Safety and
HealthAmorepacific has promoted various organizational
reinforcement activities to achieve its 2030 goal of having
zero accidents and to create a safe and healthy working
environment for employees and stakeholders.
To this end, our Safety and Health Center, which oversees
company-wide safety and health affairs, was recently
established and a Safety and Health Secretariat was set
up as an affiliated organization. The Safety and Health
Secretariat is dedicated to non-manufacturing sites tomaintain a healthy and safe working environment for theAmorepacific headquarters, stores, and workers in special
employment. In addition, dedicated organizations wereformed to improve the level of safety management. This
included estabilishing a safety environment support teamat Amore Beauty Park, the Daily Beauty production site,
logistics centers, and healthcare production sites.
Besides all of this, the Safety and Health Management
Committee controlled by the CEO of Amorepacific wasestablished as the highest decision-making body forsafety and health. Through the committee’s regularmeetings, which are scheduled to be held at least once
every six months, the status of safety management at
all our business sites is monitored and improved on acontinuous basis. Further to that, it is operated by the CEO
and safety and health executives in this field by reviewing
Amorepacific’s safety and health performance, inspecting/correcting harmful or dangerous factors, and examining
the implementation of safety and health-related laws.

Operation of the Safety and
Health Management Committee
The Safety and Health Management Committee isoperated as a decision-making body to prevent companywide safety accidents.

Organization Chart of the Committee
Safety and Health Management Committee

Safety and Health Center

Organizationin charge

SCM

R&I

Headquarters

BeautyDaily Beauty
Amorepacific

Logistics
Healthcare

R&I Center

HR
Development
CenterAppendix

68

Strategic Tasks for Preventing Serious Accidents

AP-SHE Portal: A Safety and Health IT System

Amorepacific Group responds to any potential problems
by establishing strategic tasks to protect its employees
and diverse stakeholders from serious accidents.

Amorepacific Group established an AP-SHE portal that canbe used by linking computers with mobile devices to makedigital transition of safety and health management possible.

Our new safety and health management policy, whichmust be followed by all employees at Amorepacific,
allows us to manage quantitative goals to achieve zero
serious accidents and identify/improve risk factors. Not
just that, we have established a new work evaluation
process for safety and health person in charge ofmanagement/supervisors, and we strive to strengthen
the safety management of our suppliers by regularly
carrying out safety and health assessments for contacting,outsourcing, and entrustment. In order to fully comply
with safety and health laws, we have also developed achecklist consisting of 713 items that were all drawn from32 related laws already applied to Amorepacific, and areworking hard to secure top safety and health standards at
all workplaces by conducting inspections more than once
every six months.

Staff in charge of safety and health from all of AmorepacificGroup’s business sites participated in the development of
the AP-SHE portal as task force members. The portal site
consists of a total of 13 safety and health tabs, including
safety work permission, safety inspection & improvement,
council on safety and health, accident reporting &investigation, working environment measurement, andhealth examination. The newly developed AP-SHE portal
has started to manage safety and health data that until
then had been scattered around different parts of thecompany’s intranet. On top of that, we established a system
to automatically aggregate and analyze the safety andhealth performance of different business sites by linking
them with Amorepacific’s existing systems. In particular, weestablished a mobile safety work permission process and asafety inspection system to strengthen field-oriented safety
management. Through this, an effective management
system was established to check and improve the safety
management status of business sites in real time.

Regional BU
Directly/
Indirectly run
storesOSULLOC
production site

AmorepacificGroup1)

Nonmanufacturing

Chapter 3

COSVISION

innisfree

PACIFICPACKAGEETUDE

OSULLOC FarmespoirAMOS

OSULLOC
Green Partners
WeDream1)	The Group operates its Industrial Safety and Health Committee andconsultative bodies for safety in accordance with all relevant laws.
Mobile screen captures of the AP-SHE portal

CEO Message

Brand Portfolio

Chapter 1

Chapter 2

Chapter 3

Appendix69

Safety Activities at Amorepacific Business Sites

Strengthening the Safety Management of Contractors

Uncovering Harmful or Dangerous Factors andReinforcing Improvement Activities

Amorepacific is continuing its efforts to build healthyand safe business sites not only for its employees but
also for its contractors. In 2021, Amore Beauty Park
operated collaboration programs1) for 13 internal andexternal contractors. As a result, it achieved Level A
certification, something only the top 10% of applicantsin safety management receive. In addition, we are doing
our utmost to address and improve supplier safety
management issues through our monthly meetings ofconsultative bodies for the safety and health of internal
contractors and for outsourced construction projects.

Amorepacific carries out a wide range of activities to
uncover and correct harmful or dangerous factors insidebusiness sites. In fact, we adopted a mobile safety work
permission system to strengthen safety management ofoutsourced construction projects, and discover potential
harmful factors to the workplace by conducting premeetings for work plan review and risk assessments.
In order to solve and eliminate harmful or dangerous
factors discovered in this way, action priorities areclearly designated, with subsequent action plans thenestablished and implemented.
Also, a new safety training center has been set up at Amore
Beauty Park to intensify safety education before people
start work at their new jobs, while routine inspectionsorganized by safety people in charge of management
and supervisors continue through monthly Safety Day
events. To strengthen the safety management of forklifts
with a high risk of accidents, we adopted a line beam, abody recognition rear camera, and an approach detection
beacon system. At the same time, we operate additional
surveillance cameras to enhance safety monitoring inareas for process safety management (PSM).
.

Strengthened Process Safety Management for Outsourced Construction
Coverage: All outsourced projects (general, high risk)

Precautionary Measures
Consultation reporton new investments
and repair costs

Project foroutsourcing occurs

Creating work plans

Consultation reporton weekly outsourcing
work plans

For projects that take more than one week,
repeat this process weekly.

On the Day of Work

Access to thebusiness site

Pre-meeting for safety
work review

Safety Training
CenterWork done andinspected

Work completed

Completion report

Adoption of forklift safety equipment (line beam, automatic control rear camera, approach detection beacon)

Safety and Health Assessments for Contracting,Outsourcing, and Entrustment
Amorepacific came up with its own procedures
and standards for regularly evaluating the level ofsafety and health measures now implemented bycompanies that conduct businesses in the form ofcontracting, outsourcing, and entrustment. Contracting,outsourcing, entrustment are divided into four types(office work business, low-risk business, general risk
& high-risk businesses, and construction companies)
for management. When a contract is signed with
Amorepacific, the contractor’s safety and health levelis classified and managed according to the evaluation
score based on the contractor’s safety and health levelassessment report and evidence materials at the time.
After such safety evaluations, qualified companies forcontracting, outsourcing, and entrustment are carefully
selected and, when necessary, we ask them to improvetheir conditions according to the evaluation results
to secure the safety and health of workers at thesecompanies.
1) A program hosted by the Ministry of Employment and Labor

CEO Message

Brand Portfolio

SHE Audits & Compliance to Laws and Regulations
Assessments
In order to manage global SHE risks as well as laws andregulations, Amorepacific Group has introduced Groupwide advanced management standards and establisheda SHE standard and SHE audit system. As a result, theGroup constantly monitors, assesses, and improves
related issues and risks. Also, the Group has an advanceinspection system from a SHE perspective when taking
over new business sites. SHE performance results areconstantly managed and improved through various
means, ranging from self-audits at business sites andcross-audits between different sites to third-party audits
by professional external institutions. In particular, wehave developed a checklist consisting of 713 items for 32
laws related to safety and health in order to respond to
the Serious Accident Punishment Act, which entered into
enforcement in 2022, and conduct compliance checks forall our business sites semi-annually to ensure improved
compliance.

Chapter 1

Chapter 2

Appendix

Emergency Preparedness and Response Training

Education Related to Safety and Health

Amorepacific has established response and relief plansin cases of accidents and any risk of future accidents. By
conducting emergency response training, we are making
every effort to minimize damage to workers and ensure
their safety and health. Furthermore, we manage an
emergency contact network of related organizations andhave more than 10 emergency scenarios, including fires,
chemical leaks, gas accidents, and power outages. In
accordance with the emergency scenarios, each businesssite sets an emergency response training plan at the
beginning of the year, and workers actively take part increating safe workplaces with an awareness of all thesepotential accidents.

Amorepacific endeavors to prevent serious accidents at
workplaces and improve workers’ awareness of safety
and health by providing legal education as well as
safety and health education on work with harmful or
dangerous factors, all of which is mandatorily carriedout by safety and health officer at each business site inaccordance with related laws. What is more, numerous
training courses have been established to foster safety
and health professionals at our business sites since 2022,
including courses for obtaining national safety and healthcertificates.

Investigating Accidents and Preventing Recurrences
Amorepacific is working hard to prevent the recurrenceof similar accidents and serious accidents by establishingprocedures for reporting and investigating all
incidents and accidents at its business sites as wellas investigating the immediate/root causes andestablishing/implementing measures to prevent any
recurrences. Safety and health officer at each workplace
have completed training in RCA (Root Casual Analysis)
investigation course through external specialized
institutions, and in the event of an accident, an accident
investigation team is formed to reconfigure the accident
situation and take follow-up measures to prevent similar
accidents.

Chapter 3

Emergency preparedness and response training

70

A total of 10 Safety Golden Rules were also established toprevent safety accidents that may occur at Amorepacificbusiness sites. We are making every effort to firmly
establish a top safety culture and become a safe workplaceby establishing principles that all employees must follow.

Activities to Strengthen Safety Culture
Amorepacific oversees diverse activities to improve thesafety culture of its business sites. In order to strengthen
safety awareness and mutual communication among
all workers, we make use of the Industrial Safety and
Health Committee, the council on safety and health,as well as our Safety Shinmungo reporting system ascommunication channels. We also publish a Safety and
Health Newsletter every month to continuously provide
information for a safe and healthy working environment.
Furthermore, Amore Beauty Park holds an official Safety
Week campaign once a year with "Safety is Beauty" as
its main slogan, providing time for employees to truly
recognize the importance of safety through the dispatchof Safety Letters, an exhibition highlighting accident casesand safety protective device, a safety slogan contest, andfire emergency evacuation training. The virtual reality(VR) safety education, which had been conducted as apilot program in 2020, was actually provided for workers
with effectiveness. Using this as momentum, VR safety
education content will be continuously developed andapplied at our business sites.

Amore Beauty Park Safety Week

Amorepacific’s 10 Safety Golden Rules

CEO Message

Brand Portfolio

Employee Health Promotion
Amorepacific runs a number of different activities to prevent
musculoskeletal disorders and promote good health for
its employees. For the physical health of employees, we
expanded the Musculoskeletal Management Center, which
opened after signing an industry-academic cooperationagreement with Yonsei University in 2020. We regularly
conduct investigations into musculoskeletal hazards throughprofessional personnel. Based on these results, we conduct
intensive management programs and thorough evaluationsof musculoskeletal diseases for those who complain of pain,
as we wholeheartedly support healthy working conditions.
In terms of employees’ mental health, an in-house mental
health care program is operated to manage any mental
health risks to employees due to depression caused by
COVID-19 and/or job stress. The program consists of live
real-time wellness programs that employees can join without
any distance/regional constraints. We also set up a wellness
room at Amorepacific headquarters for the first time in 2021.
This is actually a separate designated space where you canfocus on mental and physical stability and mindfulness.

Chapter 1

Chapter 2

Customer
Satisfaction

Amorepacific Group aims to provide customers
with the best products and service experiences.
Based on offline stores, experience spaces,
and online malls by region, we offer various
products and services so that customers canexperience New Beauty with pleasure andconvenience. We also place top priority on
communicating with customers transparently
through ethical marketing and product

Employee health promotion

Appendix

promotion activities.

71

Customer Satisfaction

Satisfaction Management Performance1)

Amorepacific Group is committed to identifying elementsof customer dissatisfaction and maximizing customer
satisfaction. Up until 2020, the CGAP (Customer Gift for
AmorePacific) exhibition was held annually, but since2021 small group customer VOC sharing sessions havebeen held for brands and sales organizations every month.

Category

2019

2020

2021

Percentage of Resolved
Customer Complaints (%)

99.7

99.6

99.0

Satisfaction Measurement
Results (scores)

70.7

75.3

83.2

Tiki Taka Day, which delivers the voice of customers (VOC)
directly to executives, was introduced as a pilot programin 2020 and has been operated regularly since 2021.
Through this initiative, our VOC is being quickly managed
for better services, and ultimately we want to use thisto increase the value of the customer experience of all
Amorepacific brands and services.

Through this wellness room, we continue our support of the
We Care Mental program, which consists of programs suchas meditation, mindfulness yoga, and the strengthening ofresilience.

Chapter 3

Since February 2021, we have analyzed customer
characteristics, major inquiries, complaints for eachproduct to identify brand customer needs, and carried out
quality-oriented improvement & management activities
with existing products for a total of 9 brands (Sulwhasoo,
HERA, VITAL BEAUTIE, IOPE, LANEIGE, mise-en-scene,
Ryo, HAPPY BATH, Illiyoon) as well as e-commercechannels (Amore Mall, Aritaum Mall, external malls).
Moreover, we expanded quality improvement &management activities not only in products but also inpurchasing experiences by sharing VOC gathered acrosscustomer experiences at online and offline customer
contact points.

1) Calculation scope based on domestic Amorepacific businesses

Product Recall 2)
Category
Product Recall (cases)

2019

2020

2021

0

0

0

2) Calculation scope based on domestic Amorepacific businesses

CEO Message

Brand Portfolio

Expanded Non-face-to-face Services for Customer
Satisfaction
Amore Mall , an online shopping mall operated directly
by Amorepacific, has adopted various simple payment
systems that are being applied in Korea. It identifies
payment trends preferred by customers to provide
safer and faster services, and quickly provides essential
information for shopping, such as order and delivery
notifications, through a notification service. In addition,
the mall is making efforts to strengthen non-face-to-facecustomer service by operating a counseling service andchatbot program for AI-based counseling.

Partnering with Yogiyo for Delivery Services
ARITAUM signed an MOU with Yogiyo, a delivery foodordering platform, to provide a convenient orderingexperience for customers. The delivery service operates
through the Yogiyo delivery app to deliver products
immediately when a customer orders one or moreproducts from a nearby ARITAUM store. As part of thiseffort, we want to increase customer convenience andsatisfaction by reducing the time it takes for customers
to receive the products they order. ARITAUM plans to
expand this service to ARITAUM stores nationwide andstrengthen the connection between customers and stores
even in non-face-to-face situations caused by the spreadof COVID-19.

Amore Mall has adopted simple payment systems

Chapter 1

Chapter 2

Amorepacific “Gotta Try It to Believe It”
Home Testing Kits
Cumulative Orders 600,000 Units
Amorepacific Group launched a home testing kit called“Gotta Try It to Believe It” to help customers purchaseproducts that best suit them after pre-trying productsamples. Customers can receive 12 samples out of 180
products from Amorepacific brands by paying only for thedelivery charge, and decide whether to purchase themafter conveniently trying them firsthand at home. On topof that, we provide reasonable shopping opportunities
to those who use this testing kit. If customers purchaseactual products on official channels such as Amore Mall or
ARITAUM Mall, they can receive a refund on the delivery
charge through accrued beauty points. In addition tobeauty products, this service is also applied to a variety of
products related to lifestyles and is expanding customer
experience opportunities with multiple brands.

CUBE ME’s Online Diet Coaching with
“Diet with Challenge” and Protein Cube

Chapter 3

Appendix

The Guidebook for “Public Notice of Environmental
Quality Labeling and Advertising Management
Systems” and Ethical Marketing
Amorepacific Group strives to provide customers
with accurate and balanced information about its
products and services. In order not to exaggerate theenvironmental impact of products and services or provide
information that consumers may misunderstand,we produced a separate Guidebook for Public Noticeof Environmental Quality Labeling and Advertising
Management Systems in 2021, distributed it, and thenheld a briefing session on it for all employees. This wasdone to ensure that all employees of Amorepacific Groupeasily understand the Ministry of Environment’s “Public
Notice of Environmental Quality Labeling and Advertising
Management Systems” so they can provide customers
with accurate information.
In addition, Amorepacific Group carefully conducts
marketing activities to avoid disinforming customers oncompetitors’ work/products.

72

Amorepacific Group Customer Satisfaction Index

Korean Customer Satisfaction Index (KCSI)
No. 1 in the category of basic female cosmetics
Amorepacific (2021)

Brand Reputation Index (BRI 2021)
No. 1 in the category of listed cosmetic
company brands
Amorepacific (May, June, July)

Korea Brand Power Index (K-BPI)
No. 1 in the categories of male cosmetics, bodycare, female cosmetics, hair dye and hair careAmorepacific (2021)

Korean Net Promoter Score (KNPS)
No. 1 in the category of skin care products

Upon CUBE ME launching Protein Cube, a protein meal
substitute, it began operating an online diet coaching
service called “Diet with Challenge” to improve the healthof customers who aim to lose weight. Diet with Challenge
is a group-level service conducted by communicatingwith customers through online messaging services. In
previous trials, customers who were provided with dietand exercise coaching by experts for four weeks showeda healthy achievement of their target weight without
excessive diet control and exercise.

Amorepacific (2021)

Premium Brand Index (KS-PBI)
No. 1 in the category of female cosmetics
Sulwhasoo (2021)

National Brand Competitiveness Index(NBCI)Part of the Guidebook for Public Notice of Environmental Quality Labelingand Advertising Management Systems , which was produced for easier
understanding of the Ministry of Environment’s public notice.

No. 2 in the category of female cosmetics
Sulwhasoo (2021)

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Brand Portfolio

Information
Security

Chapter 1

Chapter 2

customers’ valuable personal information andguarantee their rights. To that end, we arecommitted to activities to prevent the risk of
personal information leakage and to protect thecompany’s long-standing know-how and trade
secrets. We operate an information security
center that oversees domestic and overseas
security, and we always respond quickly andprofessionally to security risks.

Appendix

Customer Privacy Protection Activities
Amorepacific Group examined the management statusof each lifecycle, from the moment personal informationis collected to the moment it is destroyed, in order toprevent customers’ personal information from being
distributed or unnecessarily exposed during the processof signing up for a membership, making a purchase, or
participating in any event. As for matters to improveupon after being discovered in this way, we make planstransparently with the Audit Committee and carry out theresolved actions quickly.
With further digitalization of Amorepacific’s customer
services, we have also reinforced the process of preventing
potential information leakage in the process of newly
building sites and improving the existing systems. What ismore is that we have strengthened our procedures so that
we can implement our digital business based on security
principles from the planning and design stages, and hired
more professionals for that purpose. In order to continue
providing smooth services to customers, customized
security training was conducted for the departmentsthat handle personal information. Furthermore, we are

Amorepacific Group strives to thoroughly protect

Chapter 3

managing information security awareness by checking
the computers of all our employees in charge of suchinformation and deleting personal information that has
fulfilled its purpose. To better serve our customers, wewill safely manage the personal information of customers
through pseudonymization whenever possible so that
individuals cannot be identified even when analyzing
customer data behind the scenes.

The scope of such privacy protection includes not only
customers but also suppliers and the Group’s employees.
Further to that, we disclose personal information
handling policies on the Amorepacific Group website indetail. The guide describes the roles of the chief privacy
officer (CPO) and the Information Security Center, whichis the department in charge, and the Group receives
complaints related to customer privacy at one fixed email
address: privacy@amorepacific.com on a constant basis.
For thorough privacy protection, we check for any risks
concerning personal information protection and thenreport the results as part of the company-wide risk
management system. We also communicate with our
employees through our corporate ethics newsletter,
Amore Ethics Briefs, making it clear that there are serious
consequences (penalties) for any privacy violations. Every
year, we ensure that our privacy protection policy isproperly maintained and operated through a third-party
institution, and conduct annual activities to internallycheck compliance with the policy. In 2021, there were no
violations of any laws related to privacy within the Group.

73

Strengthening Activities to Prevent Information
Leakage from Overseas Subsidiaries
Countries such as the U.S., China, and Vietnam are newly
enacting or strengthening privacy laws to secure data
sovereignty and protect people’s rights. AmorepacificGroup is expanding its existing information leakage
monitoring activities centered around the headquarters
to overseas subsidiaries to prevent the leakage of personal
information from overseas customers and the Group’sbusiness secrets. In 2021, an integrated control system
was established to monitor overseas subsidiaries, andcontrol personnel were assigned to be in charge ofoverseas subsidiaries. After taking into account the factthat the working environment varies from country tocountry, we started using the monitoring and control
system at some subsidiaries on a trial basis, and are
gradually strengthening this measure. If employees atour overseas subsidiaries accidentally leak information
or intentionally attempt to leak information, the preestablished automation system detects anomalies likethese and staff in charge will work closely with eachsubsidiary to rectify the situation. This can help prevent
important business secrets such as marketing and R&D
data, as well as customers’ personal information, frombeing leaked. When planning overseas digital businesses,
Amorepacific Group operates security review procedures
just as it does in Korea. Today, we are in the process of
expanding the number of countries in which we carryout this kind of monitoring so that we can prevent theviolation of privacy protection laws and possible security
leakages.

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CSR

Chapter 1

Chapter 2

Chapter 3

Appendix74

Hope Stores

Amorepacific Foundation

Each Hope Store reflects Amorepacific Group’s long-standing CSR philosophy of “Returning
the love received from women to women,” and provides single mothers—as well as female
householders— with start-up loans for their economic independence. The first Hope Storewas opened in 2004. Since then, the Group has supported the independent growth of thewomen who run them, with an idea that they are in fact confident CEOs of their own small
businesses, not merely beneficiaries of financial support. Thus, this program shows that acompany can grow sustainably with society.

The Amorepacific Foundation was established in 1973 following the express intentions ofJangwon Seo Sunghwan (Jangwon being his pen name), the founder of Amorepacific Group,
who emphasized the need for support of basic academic studies, talent development, andcultural projects. The foundation gathers information for two research projects, each with
their own theme, one being Asian Beauty and the other being Women and Culture. At thesame time, the Amorepacific Foundation runs a support project titled Jangwon Humanities
Scholars to discover and foster emerging researchers in the field of the humanities. In
addition, it contributes to vitalizing domestic and foreign networks by translating excellent
research to be published overseas.

As part of 2030 A MORE Beautiful Promise (our five major sustainability goals to achieveby 2030), all Hope Stores aim to raise the average monthly income of their businessowners, build a social support system, provide emotional support, and strengthen family
relationships. In 2021, 36 new stores were opened, similar to the level of the past three
years—even during COVID—and the 500th store is opening in 2022.
In addition, as part of our effort to increase sales at each Hope Store, we are actively utilizing
our business capabilities. For example, we carry out total consulting on live commerce, visualmerchandisers (VMD), and food businesses for revenue growth to pioneer new markets. As aresult, the average monthly income of Hope Store owners rose slightly to 2,113,536 KRW in
2021 compared to 1,818,888 KRW in 2020.

In 2021, the foundation conducted a research contest for the Asian Beauty project. For half
the month of June, two out of the accepted 32 papers were selected as finalists through an
online application. Then, out of the two research papers, “The Aesthetics of ‘Parasite’ fromSeven Points of View” (July 2021) was published. The Women and Culture research contest
and support project were also conducted in the same way, with 24 out of 282 research
projects selected as finalists. In the end, over 30 research papers were published in 2021. The
Jangwon Humanities Scholars support project selected two emerging researchers in 2020 and
two different researchers in 2022 to lay the groundwork for a balanced research environment
so that they could establish their own solid foundational research platform.

In short, through numerous online events and platforms, we contribute to smoothcommunication between Hope Store owners and increase their sense of belonging. We also
help early detection of serious diseases, such as cancer, by supporting health checkups. From2017 to 2020, a total of 365 people were supported for checkups, with emergency treatment
expenses also provided to some children of store owners.

Amorepacific Group strives to closely take toheart the needs of the community and fulfill its

Amorepacific will continue to make strenuous efforts to assist with Hope Store operations,help increase revenue, and improve the individual health and well-being of all store founders.

social responsibilities so that it can spread thevalue of diversity and inclusion, while achieving
harmonious growth with all stakeholders at thesame time. To this end, the Group runs various
CSR programs that have a positive impact onsociety, focusing on three major initiatives:
women, nature & ecology, and culture.

Books published by the Amorepacific Foundation

CEO Message

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Chapter 1

Chapter 2

Amorepacific Welfare Foundation

Chapter 3

Appendix75

innisfree Moeum Foundation

The Amorepacific Welfare Foundation was established in1982 to promote women’s welfare and improve their qualityof life. A social welfare corporation in the “new normal” era,
the foundation strengthens its own expertise and reinforces
its influence through public-private cooperation. What’smore is that it is attempting to bring about a new approachbased on spaces for women in the community. In 2021, it
supported the improvement of spaces at women’s facilities
and non-profit women’s organizations in considerationof the vulnerabilities of those facilities and organizations.
Eight facilities with substandard indoor environments due totheir age were selected for the improvement of their interior
design, while three facilities that had difficulty in providing
online services and installing digital infrastructure wereselected to receive online device support.

On top of that, 18 facilities that needed to be betterorganized and improved environmentally were selected, withthe foundation supporting them through organizational andstorage consulting. A total of 123 women whose careers had
been interrupted were invited to participate in this endeavor.

Graceful Shelter: Before renovations

Graceful Shelter: After renovations

With this new approach to support women and small
businesses in the community, the Amorepacific Retail
Creative Team, Yongsan-gu Office, POSCO, and Daelim Bathall got together and launched a Beautiful Powder Roomproject by improving public restroom facilities in Itaewon,
Seoul to make them safer and more pleasant. Also, theAmorepacific Design Center and its Interior Team operated
a Design Project for Local Stores program with college
student volunteers, transforming poor stores at the outsetof COVID-19 into truly unique establishments, which soon
contributed to an increase in revenue.

The innisfree Moeum Foundation is a non-profit foundationthat was established on Jejudo Island in 2015. The
foundation is funded entirely by innisfree, with a donation
contract of 10 billion KRW serving as its base. Since it got off
the ground, it has been running public interest projects forpreserving Jeju’s natural ecology, fostering future talents,
and promoting Jeju’s unique cultural value.

Ecological Restoration of Biyangdo and Biodiversity
Preservation
Biyangdo Island, an islet off the west coast of Jejudo Island,
is a beautiful little island whose original form is preserved
without any modern, overt development. Although there
used to be a fair number of trees on the island, some of themwere destroyed by fire in the past. The innisfree Moeum
Foundation established a tree nursery on Biyangdo Island
for the purpose of not only restoring the island’s natural
ecosystem but also preserving its biodiversity.

Unveiling ceremony for the signboard at Biyangdo nursery

The nursery is a 33m2 glass greenhouse and was installed
in an area where yellow rosemallows were planted after
the foundation signed an MOU with the Biyangri Village
Association in 2020. The tree nursery will be used forobserving various plants that grow naturally on Biyangdo
and to plant trees suitable for the growing environment
there. Besides that, more than 70 trees, including raspberry
and cypress trees—both of which have excellent carbon
absorption rates—were planted on International Day for
Biological Diversity on state-owned land that used to be
full of weeds. The foundation will continue to carry out awide range of activities to foster native plant seeds suitablefor Biyangdo’s environment so that the island can betransformed into an ecological garden.

CEO Message

Brand Portfolio

Chapter 1

Chapter 2

Chapter 3

Appendix

76

A Study on Jeju Oreum through a Multidisciplinary Approach
The innisfree Moeum Foundation started a research survey
to discover the value of oreum (volcanic cones) on Jejudo
Island in a multidisciplinary approach. This included studying
the island’s topography, vegetation, animals, and humanenvironment. For the purpose of publishing a liberal arts
book through research and demonstration, experts ineach field were appointed as contributing members, with
Eoseungsaeng Oreum, which is located in Hallasan National
Park, being named the subject of the study. Eoseungsaeng
Oreum is a volcanic cone that was formed by a great deal of
volcanic activity, and is noteworthy in terms of its topography
and geology as well as its many different plants and animals
that coexist there.

Junior inniclass

Junior inniclass
The innisfree Moeum Foundation runs a Junior “inniclass”
with the aim of cultivating awareness of environmental
conservation for children who will one day lead the futureof Jeju. The Junior inniclass is an ecological environment
education program that uses digital devices to have kids learn
about the conservation of natural ecology, environmental
protection, and resource circulation. Amorepacificemployees, who put their special talents on full display as
volunteers, participate in it as instructors. Lipstick upcycle
crayons and coloring books featuring 12 native plants to
Jejudo Island were used as teaching materials.

A total of 11 elementary schools on Jejudo Island took partin the Junior inniclass, which was conducted as a remoteclass because of social distancing rules at the time. Throughthe Junior inniclass, participating students had time to learn
about Jeju’s natural ecological environment and think about
how to live more responsibly for the world’s environment in
the future.

A volcanic cone on Jeju

In addition, from the creation of Eoseungsaeng Reservoir
to the establishment of Hallasan National Park, it has animportant influence on the lives of the residents, so thevolcanic cone itself has a significant amount of research value.
The contributors conducted quarterly field trips and research
activities, and will publish their book after determining theage in which the volcanic cone was formed, analyzing soil
components, and holding expert workshops. The innisfree
Moeum Foundation aims to help create a sustainable andclean Jeju where people and nature coexist by publishingrelevant books that resonate with people in the future.

CEO Message

Brand Portfolio

Chapter 1

Chapter 2

Cultural Value Promotion through a Win-Win Partnershipwith a Local Village
Sinheung 2-ri Dongbaek Village is a natural habitat forcamellia, a glossy-leaved shrub native to Asia and Jejudo
Island’s 27th designated provincial monument, and was thefirst village that Amorepacific signed a Beautiful Fair Tradeagreement with. The village of Dongbaek, which means
camellia (also called japonica) in English, and Amorepacifichave been in a win-win relationship for more than 10 years,
as Dongbaek Village has supplied ingredients used forAmorepacific cosmetics, and Amorepacific has designed thevillage logo and packages of edible camellia oil, a productfrom the village, through talent donations from its employees.

Chapter 3

Appendix

77

Fostering Talents with the Tangerine Scholarship
Program
The innisfree Moeum Foundation was able to promote thecultural value of the village by supporting documentary video
production to promote the excellence of camellia on Jeju andthe value of Dongbaek Village, which has a history going back
300 years. The foundation will continue to work towards
achieving two important values: win-win growth with local
communities and cultural value promotion.

The innisfree Moeum Foundation operates the Tangerine
Scholarship Program to discover and support outstanding
talents to lead the tangerine industry, a business that
represents Jejudo Island. Since 2018, the program hasawarded 86 million KRW in scholarships to 58 highschool and college students on four occasions.

.

Amorepacific China’s Makeup Your Life projectTwo-cancer Screening

Part of a documentary video on Dongbaek Village

Tangerine scholarship award ceremony

As part of the Makeup Your Life project, Amorepacific
China is supporting women’s health to prevent breast
cancer and cervical cancer, two prominent female
cancers, jointly with the China Women’s Development
Foundation. In 2021, the project was carried out in eight
prefectures in China, including Heilongjiang, Guizhou,
and Yunnan, and the eligible areas were expanded fromrural areas to cities, removing residential restrictions forbeneficiaries. To address the trend of the onset of thesecancers affecting women at younger and younger ages,
the age range for screening was expanded from 35 to 60
years old to 20 to 60 years old. Additional training was
also provided to medical staff to improve testing skills andprovide better services to women. As a result, the projectprovided free screening for 15,285 women in 2021 andwas also able to provide more practical medical services toeconomically disadvantaged women.

CEO Message

Brand Portfolio

Chapter 1

Chapter 2

Chapter 3

Appendix

78

BETTER SHE

AMORE YOUTH

In 2020, Amorepacific China started the BETTER SHE
program in collaboration with the China Women’sDevelopment Foundation. This project aims to train
women in rural areas as caregiving professionals andsupport employment to help them become economicallyindependent and strengthen self-development. In 2021,
710 women took part in training to become caregiving
professionals, of which 621 were successfully employed.
As a result, the ratio of employed people to the total
number of participants in 2021 was over 88%, exceeding
the employment rate of 85% in 2020. Through visits
to their new work locations and interviews with these
women, we learned that participants experienced
positive changes in their attitudes, mindsets, and social
relationships. On top of that, their overall life satisfaction
improved significantly. Amorepacific China will continue
to support women through this program in 2022.

Amorepacific China launched its first public service
for psychological treatment called AMORE YOUTH in
response to the many social demands at the beginningof the 2020 COVID-19 pandemic. With the aim of
popularizing mental health knowledge and supporting
intensive care through psychotherapy activities,
Amorepacific China established the Amorepacific Care
Special Fund in 2021 with a focus on issues such as
student care, women care, and community care incollaboration with the Shanghai Charity Foundation (SCF).
In 2021, Amorepacific China worked with the foundationand professional psychology consultants on the theme ofself-awareness, conducting 12 flexible forms of activities,
such as theme-specific roadshows, workshops, and openclasses in eight schools. In the second half of the year,
an online course targeting two topics—interpersonal
relationships and coping with stress—was offered so thatcollege students could gain greater understanding andknowledge about mental health more conveniently.

BETTER SHE

AMORE YOUTH

Mori runMori Run
The Mori Run is a public interest project that Amorepacific
China and the China Women’s Development Foundation
have jointly held for six consecutive years. It aims to provide
a greater number of healthy opportunities for more women
through fun running experiences and to raise publicawareness about the prevention and treatment of two
prominent female cancers. The 2021 Mori Run reflected thecharacteristics of each city on its offline running route. The
first destination was Guangzhou, the flower city of China,
where two lively morning runs were held on April 24 and 25.

The second destination was Wuhan, where two routes wereset, including East Lake Greenway, a popular running area inthe region. Participants who completed the Mori Run heard
about the extraordinary journey of Amorepacific’s Makeup
Your Life project over the past five years, and learned how toprotect themselves and the health of those around them byaccessing prevention and treatment manuals related to thetwo cancers.

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Brand Portfolio

Mutual Growthwith Suppliers

Chapter 1

Chapter 2

Chapter 3

Appendix79

Mutual Growth Strategy

Technological Innovation Support

MissionStrategic Directions

Enhancement of our fundamental competitiveness by supporting growth and innovation
Fair business relations basedon trust

Supporting growthand innovation

Enhancing the sustainabilityof our partners

Financial Support

Technical Innovation Support

Growth Infrastructure Support· 21.5 billion KRW of low
interest rate loan funds· 35 collaborative research
projects with suppliers·P rovided education support for
971 employees of suppliers· 1.79 billion KRW for the
Mutual Growth Investment
Fund· 48% improvement rateof returned goods due
to contamination; 77%
improvement rate of returned
goods due to impurities· S upported 16 suppliers on
environmental regulation
responses

Key Activities· Mutual Growth Agreements 100% cash payment within tendays of receiving an invoice· 52 employees dispatchedto suppliers to lead support
efforts·A ssessed 18 suppliers on
the implementation ofenvironmental regulation
responses

Private and Public Joint R&D Projects
In 2019, Amorepacific Group signed an MOU with the
Korean Ministry of SMEs and Startups to participate in the
Private and Public Joint R&D Project. As a result, the Group
provided a total of 4.29 billion KRW for a span of three
years up to 2021, with the money being used to support
the development of new technology and new products from
SMEs. In 2020, the Group took part in joint R&D projects todevelop eco-friendly packaging for reducing plastic waste
and circulating resources, while also creating devices for thedigital transformation of businesses. In 2021, the Group
additionally ran a project to develop a functional packaging
material that featured an oxygen removal function, anotherproject to develop a smart wireless complex sensor module
for small injection molds, as well as a project to enhance
the integrated mold management system.

Establishment of a Manufacturing Execution System (MES)

In the global business environment, coexistence
and mutual growth with business partners
is not only the competitiveness of companies
but also a corporate citizen’s responsibility
and driver of sustainable growth. Accordingly,
Amorepacific Group is building trustworthy
business partnerships and improving its
fundamental competitiveness for continuous
growth by supporting the advancement andinnovation of our suppliers in terms of finance,technology, and infrastructure.

Financial Support

Mutual Growth Payment System

Low Interest Rate Loan Funds

As of 2021, the Group was providing a total of 120
SMEs with 100 percent cash payments within 10 days ofreceiving an invoice. Since September 2019, the Group
has applied a mutual growth payment system for a
total of 116 primary suppliers to enhance the payment
flow, which resulted in a better payment process forsecondary suppliers. As of 2021, 398.78 billion KRW
was paid through the mutual growth payment system,transparently and stably managing cash flow throughout
the supply chain.

Amorepacific Group provides direct assistance to suppliers
through the 3.4 billion KRW Win-Win Partnership Fund.
The Group also runs a Mutual Growth Fund to support
low interest loans in collaboration with IBK. In 2021, theGroup expanded its financial support for suppliers throughits Mutual Growth Fund of 18.1 billion KRW, an increaseof 1.6 billion KRW from 16.5 billion KRW in 2020. As
of 2021, the Group is also operating a 1.79 billion KRW
Mutual Growth Investment Fund to strengthen suppliers’
capabilities.

The Group supported two suppliers in 2020 and one
supplier in 2021 to develop a smart manufacturingexecution system (MES). As a result, real-time
manufacturing and operation systems, supply plans in sync
with Amorepacific’s system, and a data-based inventory
management system were equipped to enhance the speedof suppliers’ work process. We will further expand support
related to productivity for improving the overall efficiency ofbusiness activities of our suppliers in long-term cooperation
with the Group.

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Brand Portfolio

Improvement of Contamination and Impurity Issues
through Consultations
In order to upgrade the quality capabilities and process
technology of its suppliers, the Group provided consulting
for 6 suppliers to improve issues with contamination andimpurities. This resulted in the rate of returned products
due to contamination improving by 48% over the previous
year, while the rate of returned products due to impurities
improved by 77% compared to the previous year.

Research Results Sharing Program
The research results sharing program allows for theGroup and suppliers to share technical and economic
results when achieving goals through joint innovation
projects. In 2021, 12 projects were carried out, with theGroup providing 142 million KRW from its R&D Fund to
suppliers.

Chapter 1

Chapter 2

Growth Infrastructure Support
Since 2015, Amorepacific Group has provided supplierswith both manpower and financial support forparticipating in trade exhibitions held overseas. In 2020
and 2021, it was difficult for suppliers to participate intrade exhibitions because of COVID-19, but AmorepacificGroup and SMEs took part in an online purchaseconsultation meeting hosted by the Korea Foundation
for the Cooperation of Large & Small Businesses, Rural
Affairs, and made inquiries about the possibility of new
business transactions with SMEs.
Although an HRD Consortium—an education programfor employees of small and medium suppliers—wascompleted at the end of 2018, the Group has continued
to provide education programs for suppliers to enhance
employee capabilities and stabilize human resources. In
2021, the Group launched 32 training courses regarding
job duties, new employees, and managers. The focus wason key professional tasks in the cosmetics industry as wellas the improvement of practical issues at workplaces,such as quality and process management. Training wasprovided to 971 employees from 69 suppliers, all ofwhom were then subject to on-site training. At the sametime, those who received training were encouraged toactively communicate with the Group if issues came up
when returning to their companies for work.

Chapter 3

Appendix

Sustainable
Supply Chain
Management

Recently, laws and regulations on safety andenvironmental accidents have been strengthened
as a result of increased interest in non-ethicalissues, including forced labor and child laborwithin the corporate supply chain. Furthermore,
stakeholders’ demand for greater accountability
is growing with respect to these issues. In
order to manage business risks and fulfill its
social responsibilities across the value chain,
Amorepacific Group is working hard to establish
a healthy corporate ecosystem by enhancing thesustainability of its supply chain.

80

Supplier Management Status
Amorepacific Group designates and manages its criticalsuppliers by comprehensibly considering the scale andimportance of business transactions and supply capacity.
As of the end of 2021, the Group categorized 49 suppliers
as critical suppliers out of its 339 suppliers. Among them,
22 supply packaging materials, 16 supply raw materials,
and 11 provide ODM products. Amorepacific Grouppurchased a total of 796.5 billion KRW from its suppliers
that same year. In addition, the Group consistently
explores paths of mutual growth as it shares businessperformance results with local communities and equallydistributes the value of sustainability with suppliers bypromoting the purchase of local products.

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Brand Portfolio

Chapter 1

Chapter 2

Amorepacific Group Supplier Status

Chapter 3(unit)

Category

2019

2020

2021

Total Number of Suppliers

450

379

339

Number of Critical Suppliers

52

49

49

-

16

16

Total Purchasing Amount (100 million KRW)

9,690

7,733

7,965

Purchasing Amount from Critical Suppliers(100 million KRW)

4,065

3,212

5,011

Number of Secondary Critical Suppliers

Rate of Local Purchasing at Overseas Business Sites (%)

75.5

75.4

75.3

Main Target and Performance of Supplier Sustainability Management1)
Category

KPI

2021

2025 Goal

Number of suppliers’ employees participatingin the training program up to 2025

Number of suppliers’ employees participatingin the training program (persons/cumulative)

971

5,000

Ratio of strategic suppliers2) to be rated in thesustainability assessment up to 2025

Ratio of strategic suppliers rated in theassessment (%/cumulative)

67

100

Number of suppliers supported with
consulting services for sustainability
improvement up to 2025

Number of suppliers supported with
consulting services (number/cumulative)

16

100

1) Target years: 2021-2025
2) Suppliers from which the Group purchases over 1 billion KRW a year

Appendix81

Supplier Selection Policy

Supplier Sustainability Assessment

Amorepacific Group conducts business transactions withthose companies that satisfy the minimum sustainability
requirements at the point of signing a business contract.
The Group carries out sustainability assessments of
all new suppliers, and reviews compliance with legal
requirements regarding quality, product safety, labor
standards, safety and health, and the environment. The
result is a standard by which the Group decides whether
to go ahead with the contract or not. When signing
contracts, Amorepacific Group requires all suppliers tocomply with the Amorepacific Group Code of Ethics andAmorepacific Group has established, and requires all
suppliers to comply with, Supplier Sustainability Guidelines(Korean · English · Chinese), which set out 35 items onhuman rights and labor, safety and health, environmental
protection, ethical management, and other areas that need
to be considered in order for companies to fulfill their social
responsibilities. What’s more is that the Group has also
prepared a manual on how to translate the guidelines into
action and published this manual for suppliers.

Supplier Sustainability Guidelines.

Amorepacific Group conducts an annual sustainability
assessment by selecting strategic suppliers with a certaintransaction size or larger, including critical suppliers, andreflects the results in its comprehensive assessment of
suppliers. Based on the results, the Group offers incentives,
such as giving priority to receiving support for mutual growthprograms or in allocating the quantity of goods supplied.
Over the past three years, a total of 115 suppliers, including
all strategic suppliers and new suppliers, have received asustainability assessment, and in 2021 a total of 48 suppliers
received on-site inspections by an independent third party.
In addition, as the need to manage environmental data inthe supply chain has increased, we have been conducting
third-party verification of key environmental data, including
energy/water consumption and waste disposal, for 16 criticalsuppliers, which has subsequently strengthened the overall
data reliability. Suppliers that have been found to havesignificant social or environmental risks are required to takeaction to handle the risks and follow up with measures toconfirm that such risks have been dealt with.
At the same time, the Group manages financial risks throughseparate credit ratings for all suppliers, and identifies risks
in transactions with strategic secondary suppliers throughsurveys.

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Brand Portfolio

Supplier Sustainability Assessment Status
Category

2019-2021

Ratio of new suppliers that havereceived a sustainability assessmentin the past three years
Ratio of strategic
suppliers that havereceived a sustainability
assessment in the past
three years

100%

Primary
suppliers

100% / 115 units

Secondary
suppliers

100% / 16 units

Chapter 1

Chapter 2

Chapter 3

Appendix82

Supplier Sustainability Assessment and Improvements

Corrective Action Requests for High-risk Critical Suppliers

Through our supplier sustainability assessments,
Amorepacific Group identifies potential risks and requires
suppliers to take corrective measures. As a result of the2021 sustainability assessment, all suppliers showed atleast some potential risks. In cases where suppliers did notmeet our standards or had critical violations, the Grouprequires those suppliers to take corrective action andverify their corrective plans. With critical suppliers, we
also check the completion of all plans. We provide support
programs for suppliers in need of building a greater
sustainability capacity, and will apply follow-up measures,such as reducing our business with a particular supplier, if
they continue to fall short in meeting a certain standard in
our sustainability assessment.

Category(%)

Corrective Action
Request Rate

Corrective Action
Plan Establishment Rate

Completion Rate

100

100

100

One High-risk Supplier

Corrective Action Requests by Area for Strategic Suppliers
Category

Issue

Labor

Insufficient policy mandate tospecify protective measureswhen hiring minors
Insufficient operation of thegrievance handling system

Safety & Health Insufficient management ofrecords on industrial accidents
and near-miss accidents
Environment

Lack of an organization
dedicated to environmental
management

Business Ethics

Insufficient privacy
management

Risk Level(%)

Inappropriate
Supplier Rate

Corrective Action
Request Rate

Corrective Action Plan
Establishment Rate

High

50.0

100

100

High

37.5

100

100

High

45.2

100

100

Medium

64.9

100

100

Low

77.1

100

100

CEO Message

Brand Portfolio

Environmental
Sustainability

Chapter 1

Chapter 2

Chapter 3

Environmental Sustainability Governance

Environmental Investment and Education

Amorepacific Group operates the Sustainability Committee
chaired by the CEO and the ESG Committee under the Boardof Directors. In major environmental issue cases, including
climate change, chemical substances, resource circulation,and environmental pollution, executives as well as the Boardof Directors receive reports on them, while those cases aremonitored so that they are managed based on the Group’s
environmental policy. Through Group-wide approaches andcollaborations, Amorepacific Group continues responding torisks and finding potential opportunities for change. In addition,according to the many revised environmental regulations, we
respond to major issues by reporting annual performance andplans once a year to the Board of Directors, where we obtainapproval for final decisions.

Amorepacific Group has continued to make managerial
efforts and investments into environmental protection
by developing a number of eco-friendly processing
technologies and products. In 2021, the Group invested a
total of 3.73 billion KRW in environmental operations andinvestments. There have been no significant violations ofenvironmental regulations and no fines and penalties overthis time. Furthermore, the Group provides education on
plastics, environmental labeling, advertisements, climatechange, and chemicals to enhance understanding of ecofriendly management and promote participation in related
activities. In 2021, a total of 3,516 employees completed
3,086 hours of training. In particular, the Subcommittee
on Safety and Environment provides environmental
education other than compulsory legal education, such asenvironmental/energy policies and trends, management ofpollution prevention facilities, and building energy saving &management to strengthen the environmental capabilities
of working-level employees in the field.

In terms of climate change, the Carbon Neutrality Committee,
which includes the CEO and various outside experts, meets morethan twice a year, and the Plastics Committee, which aims to
reduce plastic usage and circulate resources, also meets morethan twice a year.

Amorepacific Group is working hard to reduce
the environmental impact of its businessactivities and expanding the positive impact
it has on society and the planet by actively
responding to environmental issues facing
the world, including climate change, water
shortages, and increasing waste.

Appendix

The Environmental Strategy Team under the Sustainability
Division establishes strategic tasks regarding climate change,
water and resource circulation, and generally manages
organizations dedicated to environmental operations at different
subsidiaries. Each subsidiary’s organization implements strategictasks for environment management, periodically monitors major
performances, and uncovers tasks to improve the overall safe
environmental levels under the supervision of each business site’s
manager through the Subcommittee on Safety and Environment,
which consists of managers in charge of environment and energy.
On top of that, we disclose information with consistency andtransparency based on diverse international standards, such asrecommendations by the Task force on Climate-related Financial
Disclosures (TCFD) and the Sustainability Accounting Standards
Board (SASB), as well as the CDP, DJSI, and FTSE4Good Index.

Environmental Management System
Recognizing that the entire production process affects
the environment, Amorepacific Group establishedan environmental management policy, applied theenvironmental management system (ISO 14001) toall business sites, and obtained the first integrated
environmental permission certificate (No. 0294-01) inthe cosmetics industry from the Korean government.
What’s more, 31 management regulations based on SHE
group guidelines are derived to operate environmental
management group standards. Moreover, we operate
a risk-oriented audit system and quantify risk factors tocorrect them with priority on high-risk problems. Besides
that, we have a response system to environmental energy

83

accidents and conduct regular training. Of particular note,
emergency response training is carried out every year, and in
2021 Amore Beauty Park prepared a total of 17 emergency
response manuals for environmental accidents, includingtransportation and storage of waste, transportation of content
and semi-finished products, weighing and transportation of
raw materials, as well as storing raw materials and handling oflaboratory reagents. In the event of an environmental accident,
it is mandatory to respond and report in accordance withenvironmental accident prevention and response guidelines.

SHE Management StandardsReg. 29
Monitoring &measurementReg. 30
Audit and inspectionReg. 31
Corrective action fornonconformity

Reg. 1
SHE management
systemReg. 2
Risk assessment &management

Act

Check

Plan

Do
Reg. 3 Legal managementReg. 4	Managing documents andrecordsReg. 5 Resource managementReg. 6 Training managementReg. 7	Communication managementReg. 8	Partners’ SHE managementReg. 9 Emergency managementReg. 10	SHE management of facilities
and equipment
Reg. 11 Chemicals managementReg. 12	Management of specificsubstances
Reg. 13	Safety management of vehicles
and unloading machines
Reg. 14	Management of hazardous anddangerous tasks
Reg. 15	Work environment
managementReg. 16	Health and hygiene
managementReg. 17 Visitor safety managementReg. 18	Business trip safety and healthmanagementReg. 19	Safety and health management
for eventsReg. 20	Safety and health managementfor daycare centers
Reg. 21	Safety culture managementReg. 22 Water managementReg. 23	Atmosphere and odor
managementReg. 24 Waste managementReg. 25	Noise and vibration
managementReg. 26	Soil and groundwater pollution
managementReg. 27	Energy and greenhouse gas
managementReg. 28	Environmental impact
assessment

CEO Message

Brand Portfolio

2030 Zero
Greenhouse Gases

Chapter 1

Chapter 2

Since announcing the Total Commitment Initiative
campaign for the environment in 1993, AmorepacificGroup has continued to strengthen eco-friendly beauty
leadership for almost 30 years with a focus on social
values.
Today, our society faces a huge and complex challengethat individual companies cannot solve alone: climate
crisis. We need to act on the issue of climate change
more rapidly than ever. To join the ongoing efforts tosave the Earth—the planet where we all live—for all of
tomorrow’s generations, Amorepacific will minimize GHG
emissions caused by our activities.

Chapter 3

Appendix

Amorepacific’s Climate Change Strategy for Carbon Neutrality

1

Amorepacific Group recognizes the seriousnessof climate change and aims to achieve zero GHG
emissions as a responsible global corporate
citizen. We will reduce GHG emissions
generated in production processes and businessactivities through the adoption of renewableenergy and the efficient use of energy, offsetting
as much in GHG emissions as necessary torealize carbon neutrality.

Company-wide	Domestic and overseas production sites, Amorepacific headquarters,
R&I Center, regional BU		PROCESSINNOVATION

2

Production

		
3

4

PRODUCTINNOVATION

100%

Domestic and overseas production sites

Carbon neutrality

5 production sites

Eco-friendly vehicles

100% transition

Suppliers

Assess suppliers’ sustainability and jointly reduce GHG emissions

Products

Development of products with a reduced environmental footprint		
5

Recycled electricity

Logistics Suppliers Domestic logistics

		

We think that making a concerted effort to convert
electricity used throughout the entire process of
production and disposal of products into renewableenergy is the first thing Amorepacific can do.
By 2025, 100% renewable energy will be used everywhereat Amorepacific, including production sites, Amorepacificheadquarters, the R&I Center, as well as stores and sales
offices, to minimize the first phase of climate impact
connected to production. Also, we will develop productswith a reduced environmental footprint to reduce GHG
emissions throughout the entire process, from thepurchase of raw materials to product use and disposal. We
will continue to work with diverse stakeholders, including
the government, businesses, suppliers, civic groups, andcustomers, to solve the climate crisis facing all humankind
together and make the planet we live on healthier andmore beautiful.

84

Consumers

Expand products with less water/carbon usage
Reinforce R&D on green chemistry
Reduce plastics and improve materials and structures
Awareness improvement

		Provide firsthand eco-friendly experiences andexpand education

CEO Message

Brand Portfolio

Production with
100% Renewable
EnergyChapter 1

Chapter 2

Chapter 3

Amorepacific recognized the importance of renewable energy
more than a decade ago and first adopted solar photovoltaic (PV)electricity-generating facilities at our past production site in Suwonin 2011. At that time, a solar module was installed on the roof ofthe logistics building to generate 200 kW of electricity per hour,
and the electricity produced here was supplied to the headquarters
building and daycare center, contributing to 89 tonnes of GHG
reduction annually. Since then, our efforts to expand renewableenergy have continued every year. As a result of these efforts,
Amorepacific’s own renewable energy generation capacity now
reaches approximately 6MW across the Group, with the Shanghai
Beauty Campus achieving 100% renewable energy in 2021.

Appendix

85

AMOREPACIFIC RE100 Roadmap

100%Energy use reduction andefficiency

Expansion of in-housesolar photovoltaic power

In 2021, the Group declared 2030 A MORE Beautiful Promise. This
represents our five major sustainability goals to achieve by thatyear. As part of the goals, and in order to coexist with nature, we
participated in Global RE100 in March 2021 to further implement
and achieve carbon neutrality at global production sites. Recently,
with the aim of achieving 100% renewable energy by 2025, which
would be earlier than scheduled, various attempts have been madeto utilize the newly revised domestic renewable energy policies.
Specifically, the Group participated in green pricing by the Korean

Amorepacific Group is planning to replace
all the electricity used at every one of its
production sites, its R&I Center, logistics, andregional business organizations with renewableenergy by 2030. To this end, we are taking thelead in actively investing and utilizing policies
to expand renewable energy generation, andproducing products with energy from solar andrenewable energy sources.

generation

35%

government in 2020 and has steadily adopted it for our businessup until now. At the same time, we have signed a contract with SK
E&S for the direct supply of renewable energy—a first in Korea—inMarch 2022.
Amorepacific’s ambitious aim to achieve our goal at our many
domestic business sites by 2025, which would be earlier thanoriginally scheduled, can definitely be seen as a risk amid a rapidlychanging market situation that features a wide range of newpolicies. However, we know that the climate crisis is a challenge forall of us, one that requires an immediate response and one that weneed to be proactive about to address. The transition to renewableenergy is clearly the direction of the times, and is the top prioritythat we must fulfill in moving toward our goal of carbon neutrality
throughout the work process.

Renewable energy supply
to business sites throughdirect/indirect purchase
contracts
Utilization of green pricing

18.5%

Purchase of renewableenergy certificates

0.4%
2011

4.9%
2020

2021

2022 Goal

2025 Goal

CEO Message

Brand Portfolio

Opportunities
through Climate
Change Risks

Chapter 1

Chapter 2

The potential impact of climate risks will affect all supply
chains around the world, including Amorepacific Group.
In 2021, Amorepacific conducted an analysis of climatechange risks and opportunities. We then collected
opinions from all employees on climate change toconfirm the relevance of our strategy for mitigation andadaptation to our business operations.
Depending on the long-term nature of the risks and thenumerous supply chain configurations, immediate action
is needed when considering the potential and long-term
impact on people and the planet, even if some risks do notappear to have a significant impact on a short-term basis.
In particular, physical risks and transition risks have beenreviewed throughout the process, and excessive water
use and limited supply due to climate change are both
expected, so more efforts are needed to reduce water
resource risks caused by product use.
The myriad risks identified in the climate risk assessment
have been linked with opportunities for transition.
Through this, Amorepacific Group developed mid- tolong-term strategies and is preparing detailed businessactivities to promote change.

Chapter 3

Appendix

86

Key Emerging Risks and Opportunity Factors1)
Category

Climate Change Risks

Climate Change Opportunities

Emerging Financial Impact

Regulations· Enhanced reporting obligations for GHG
emissions· Increased product export risks andcompliance costs due to stricter regulations
on packaging materials and waste
management· The Group was excluded from
GHG management regulations inaccordance with the carbon neutrality
goal of production sites in 2030.
· Expanded renewable energy
generation reduces cost exposure torising fossil fuel prices.
· The production of recyclable products
reduces EPR costs.

· Cost increase for responding toclimate-related regulations· Minimized variable fossil fuelcosts through 100% conversion
to renewable energy.
· Reduction of mid-to-longterm production costs throughefficient energy facilities.

Technology· I ncrease in water and energy usage atbusiness sites due to the advancement of
product quality levels (such as the adoptionof facilities)·R esearch on low carbon and water-saving
products and technologies is needed.

· Securing a competitive advantage
in technology and quality based onchanging consumer preferences· Establishing a low carbon production
process· Energy costs due to newinvestments, research, andequipment purchases· Reduced costs by reusing waterand rainwater

Products
and Services· Changes in market demand and revenue due
to consumer behavior changes· Increased uncertainty in the supply of raw/
subsidiary materials due to extreme weather· Restrictions on the use of water-intensive
products (including shampoo and body wash)in countries with water stress· I ncreased consumption of low carbon
and water-saving products·R educed operating costs through thetransition to eco-friendly logistics,
transportation, and sales methods·C reating new market value by
adapting to climate change· Cost increase due to increased
cost of raw materials caused byextreme weather· Increased demand and sales oflow carbon and water-saving
products· Cost reduction through efficientlogistics and distribution

Reputation·N egative views and evaluations ofstakeholders (including NGOs)· Sincere communication withcustomers by expanding eco-friendly
activities· Revenue decrease due to a lower
level of customer trust· Revenue increase due to theimproved image of the Group as
preemptively responding to theclimate crisis

Physical
Risks· Reduced quality of raw/subsidiary materials
and products due to sudden temperaturechanges· Production disruption (transportation, supply
chain disruption, safety and health issues,
absenteeism, etc.) due to increased extreme
weather conditions (e.g. typhoons, floods)· Increased repair costs due to facility damage· E stablishing climate change
adaptation measures such as
reinforcement of facility safety
inspections according to seasonalchanges, and the strengthening ofhealth management of employees aswell as product handling management
to prevent related damages· Financial loss due todiscontinuation of production· Avoiding emerging risks byestablishing a preventive climate
adaptation management
strategy

Amorepacific Group is focusing on preemptive
risk identification and response in order to turnthe risks of climate change into opportunities.
We classified emerging risks and the financial
impact associated with climate change
into regulations, technology, products andservices, reputation, and physical risks before
developing a detailed strategy to link each risk
to opportunity.

1) See p. 23 for key activities in 2021.

CEO Message

Brand Portfolio

Amorepacific’s
Key GHG
Achievements

Chapter 1

Chapter 2

In 2021, Amorepacific achieved about 22.9% GHG
reduction compared to 2018. Various sectors within
the Group, such as production, logistics, and building
management have tried to use less energy. Especiallyin 2021, a roadmap for 100% conversion to renewableenergy was established and implemented immediately.
As a result of efforts to reduce emissions at all businesssites, direct and indirect emissions in 2021 totaled
47,703 tonnes. That represents a 22.9% reduction
compared to 2018 baseline emissions. Despite a 7%
increase in production, the Group achieved decoupling of
GHG emissions from the production process. As of 2021,
Shanghai Beauty Campus had achieved carbon neutrality
by using 100% renewable energy and GHG offset credits
equivalent to Scope 1 emissions. In 2022, the Group aims
to reduce GHG emissions by 30.5% compared to 2018baseline emissions.

Chapter 3

Appendix87

GHG emissions
Carbon Offset

Scope 1

Scope 2

(ktCO2e)

2018

11.4

2019

10.9

44.7

2020

10.6

44.4

2021

1.6

48.4

11.0

36.7

-12.1

22.9% Reduction
In 2018(Scope 1+2)

2022

2025

1.2

10.0

8.1

33.3

0.4

2)

RE100

-15.3

30.5% Reduction

1)

TargetTarget1) Includes offset credits
2) Residual Scope 1 emissions from buildings and sales offices

Scope 3

(ktCO2e)

Upstream logistics

At all of Amorepacific Group’s business sites, theGroup continues to find/execute tasks to reduce
GHG emissions. Based on the performance

Employee commuting

2021

2.0

results of 2021, we are planning to carry out

Activities related to fuels

more active GHG reduction activities to achieveand energy

our goal of carbon neutrality.

0.7

1.0

Downstream rental assets

2.6
Emissions from the disposal stage

0.1 Waste generated at business sites

2.8CEO Message

Brand Portfolio

Chapter 1

Chapter 2

Launch of the Carbon Neutrality Committee

Transition to Low Carbon Logistics

In order to achieve Amorepacific’s goal of 2030 carbon
neutrality, it is necessary to quickly understand all
relevant trends in the global market, establish optimal
countermeasures after careful consideration, and sincerely
promote them. To that end, Amorepacific launched a Carbon
Neutrality Committee consisting of industry and academic
experts and Amorepacific’s top management in 2021.
This has allowed it to come up with concrete action plansto achieve a Carbon Neutrality Roadmap by 2030. Today,
the Carbon Neutrality Committee meets more than twicea year. At its first meeting in 2021, it confirmed energy
reduction efforts across the Group, including Amorepacificheadquarters, Amore Beauty Park, and the R&I Center. At thesame time, it confirmed the installation of solar photovoltaic
facilities, green pricing contracts, the signing of a supply
contract for renewable energy with SK E&S, and its transition
to electric vehicles at the Incheon Logistics Center. The
Group also finalized a specific roadmap for achieving carbon
neutrality at its global production sites and 100% conversion
to renewable energy at all its business sites to achieve its goalby 2025, which is earlier than originally planned.

Since 2021, a total of 15 internal combustion engine
vehicles contracted with vehicle owners at the Incheon
Logistics Center have been converted into electric vehicles,with five rapid chargers having already been installed.
This reduced Scope 3 GHG emissions by about 22 tonnes.
What’s more, Amorepacific is striving to minimize GHG
emissions in areas of direct and indirect activities to deliver
the products it produces, and plans to convert all related
distribution vehicles into eco-friendly vehicles by 2030.

Improving Energy Efficiency for Production
In 2021, heat pipes at Amore Beauty Park were applied toreduce GHG emissions by 35MWh and about 16tCO2e. On
top of that, it saved more than 160 million KRW in energy
costs through various reduction activities, such as decreasing
GHG emissions of about 26tCO2e through the expansionof solar photovoltaic systems, piloting a small hydropowersystem, and reducing the operating load of thermostats. For
its part, the Daily Beauty production site is working hard
to improve energy use efficiency by reducing 158MWh ofenergy through air compressor efficiency and peak power
management.

Chapter 3

Appendix

Minimizing
Environmental
Pollution

Improving Water Resource Efficiency
Amorepacific Group is deeply aware of the need to makeefficient use of all water resources, optimizing its water
withdrawal under the principle of 3R—Reduce, Recycle,
and Reuse. In 2021, Amorepacific reduced its water
withdrawal intensity by 4.4% percent and AmorepacificGroup did the same by 5.7% compared to the previous year.
In 2021, Amore Beauty Park established an automaticwater usage monitoring system for each place of use to
manage water in real time. Besides that, 100% of thelaundry water has been replaced with rainwater, andrecycled water was additionally expanded for the toilet
supply. As such, we continuously identified tasks to reducewater usage. The Group is also reducing water consumption
by strengthening regular inspections, such as expanding
inspection frequency and points, at all production sites,
including COSVISION.

Eco-friendly Energy Building
The Amorepacific headquarters is an eco-friendly building
verified with first grade G-SEED (Green Standard for Energy
and Environmental Design) certification, first grade energy
efficiency, and gold grade LEED (Leadership in Energy
and Environmental Design). The building is designed toconsume 37.6 percent less energy than its energy demand
projection. This is accomplished by saving energy throughthe utilization of high-efficiency transformers and motors,
power factor correction capacitors, and a DALI (Digital
Addressable Lighting Interface) system that senses
the natural level of light and automatically adjusts thebrightness of the interior of the building.

88With the Daily Beauty production site, it plans to installa flowmeter for each subdivided place of use in 2022 to
upgrade the management level.

activities to minimize the use of water resources,

Amorepacific Group will continue to minimize the use ofwater resources, including municipal water and groundwater, and expand water recycling at its production sites.
One way it will accomplish this is by increasing the use ofsuch as municipal water and ground water, andrainwater.

Amorepacific Group is constantly pursuing

to increase rainwater as it continuously adopts
wastewater discharge and recycling technologies.
We have established an integrated chemical
management system (AP-CHEMS) to safely
manage our production sites, while focusing on air
pollutant reduction activities and efforts toward
zero waste landfill.

CEO Message

Brand Portfolio

Wastewater Discharge and Recycling
In accordance with the revision of the Enforcement
Rule of the Water Environment Conservation Act,the measurement indicator of organic pollutants in
wastewater was converted from COD (chemical oxygen
demand) to TOC (total organic carbon). Accordingly,
Amore Beauty Park adopted a device that analyzes TOC
and always monitors it to ensure thorough compliancewith regulations. At the same time, an automatic bar
screen was installed to filter out large foreign substances
during the wastewater pretreatment process to treat
wastewater more efficiently.
The Daily Beauty production site also plans to expand
diffusers that supply oxygen to wastewater purifying
facilities using microorganisms to reduce power use andstrengthen microbial activity, thereby maintaining a highquality of discharged water.

Return of Endangered Otters Thanks to the Osancheon
Ecological Stream Restoration
Amorepacific defines biodiversity reduction in the aquatic
ecosystem as one of the major risks associated with water.
This is because major biodiversity losses and an ecosystem
collapse can have irreversible consequences for theenvironment, leading to severe resource depletion.
To protect the aquatic ecosystem, Amorepacific has
participated in the restoration of the Osancheon
Ecological Stream in Osan, Gyeonggi-do, where
Amore Beauty Park is located. The Osancheon Stream
is a 15-kilometer-long stream that starts in Yongin,
Gyeonggi-do, passes through Osan, and ultimately drains
into the West Sea.

Chapter 1

Chapter 2

Amorepacific signed an agreement with the City of Osanin 2016, and has actively conducted environmental
improvement projects for Osancheon by donating 6.3
billion KRW up to 2021 in an effort to create a wetland
ecological garden and install ecological education
facilities.
As a result, the water quality level of the Osancheon
Stream, which had fallen to level 5 (very bad), was purified
to level 2 (good). More recently, otters, a first-classendangered wildlife found only in clean waters, have beenspotted, confirming that the ecological environment of
the Osancheon Stream has been greatly improved.

Reduction of Air Pollutants
In order to reduce the emissions of air pollutants,
Amorepacific Group regularly inspects facilities throughSHE Audit sessions. Furthermore, the Group regularly
monitors the emission of air pollutants at each production
site in order to minimize the impact on local communities.
In addition, the standard environmental impact
assessment process enforces investigation, projection,
and assessment of the environmental impact of new
business sites, eliminating or reducing any harmful impact
on the environment. Environmental impact assessments
are performed and audited in accordance with theGroup’s standard process. Based on a plan for integrated
environmental control, Amore Beauty Park installed anultra-low NOx burner to reduce NOx emissions in 2021,
and actually reduced NOx emissions by more than 27%
compared to 2020. Amore Beauty Park will continue tostrictly manage NOx emissions in accordance with internal
emission standards that were established at a level morethan 70% lower than legal standards.

Chapter 3

Appendix89

Integrated Chemicals Management

Efforts for Zero Waste-to-Landfill

Amorepacific operates its AP-CHEMS (Amorepacificintegrated chemicals management system) for all
chemicals the company uses. To be more specific, it
regularly monitors regulations and risks related tothe environment, safety, and health of all chemicals
purchased at its business sites. In the process of receiving,
using, storing, and disposing of chemicals, they are
managed according to legal standards at all Amorepacificbusiness sites. Moreover, chemicals management isstrengthened by conducting inspections at least twice ayear, including an internal audit and cross-checking bydifferent business managers. In addition, employees at all
business sites owned or operated by Amorepacific, as well
as all stakeholders entering the business sites, are trained
to implement each business site’s chemicals management
rules.

Amorepacific Group works hard to contribute toestablishing a circular economy by minimizing waste andactivating recycling at business sites. Waste generated
at each production site is categorized by types andcharacteristics, with the Group implementing optimized
measures to recycle each category of waste. Many
Amorepacific production sites were designated as Ministryof Environment target sites for the Resource Circulation
Performance Management Program, so some production
sites were already given resource circulation goals andsome will soon be given goals by the ministry.
In particular, Amore Beauty Park and the Daily Beauty
production site exceeded the resource circulation goalby continuously improving their waste recycling rates.
To achieve zero waste-to-landfill, these business sites
converted dust, which was previously landfill, into waste
for recycling in 2021. The Daily Beauty production site
has become highly reliable by adopting its own waste
meter to accurately manage emissions. We also converted
some of the organic solvents that had been incinerated tobe recycled as raw materials for cement. Moving forward,
we will make every effort to increase the actual recycling
efficiency rate by partnering with a recycling company thatboasts a strong track record of high recycling efficiency
and circular utilization of landfill waste.

CEO Message

Brand Portfolio

Environmental
Education

Chapter 1

Chapter 2

responsibility for the environment by fostering
environmentally sensible youth based on
the Group’s 1993 declaration of its Total
Commitment Initiative. We share oursustainable management vision and provide
diverse programs for young eco-creators tothink flexibly about plastic problems.

Appendix

90

Protecting the Environment Together: Love the Earth
Eco-creators
Amorepacific Group has been running its Love the EarthEnvironmental Camp —an annual eco-based camp
for children who represent our future—since 2019 toencourage young people to think about the environmentand help foster eco-creators. In recognition of these efforts,
Amorepacific’s Environmental Camp, Love the Earth wasselected as the 2021 Outstanding Environmental Education
Program1) by the Ministry of Environment.
Children who participated in this camp used a videoconferencing system to discuss upcycling and climatechange by topic with an environmental education expert
and college student mentors. They also learned how tomake a video from a video expert and became AP Ecocreators. In fact, in 2021, and under the theme of “ZeroWaste,” participants thought about this with college
student mentors and selected missions to carry out, suchas visiting refill stations, upcycling, and plogging to add
meaning to their activities. These same youth filmed theprocess of performing the selected mission and what theyfelt by doing this, produced an environmental movie, andhad a preview at the camp’s graduation ceremony to sharewith friends and family.

Amorepacific Group aims to fulfill its corporate

Chapter 3

In the second half of 2021, we launched a Love the Earth
Eco-influencer Course to inspire elementary school students
to think about environmental issues and inform them of
the concept of systematic resource circulation. As partof this, Amorepacific also developed its own workbook,Environmental Education for A MORE Beautiful Earth, Lovethe Earth Eco-influencer Course , together with the Korea
Environmental Education Center and a group of elementary
school teachers. Based on this textbook, Amorepacifichelped a total of 902 elementary school students fromLove the Earth Eco-influencer Course

nine schools learn how to reduce their use and purchaseof disposable goods and return them to resources just by
playing with each other, and how to be Eco-influencers
who can promote their practices to others around them,including friends and family.
In 2021, college student supporters participated in
the entire process as Eco-influencers. After completing
education programs on environmental issues, video
production, and leader ethics, college student supporters
communicated with elementary students as mentors sothat they could enjoy online classes together. They also led
offline classes at schools as teachers for resource circulation
to let children know the importance of the environment.

1)	Outstanding Environmental Education Program:Outstanding environmental education designated by the Minister ofEnvironment after examining the eco-friendliness, excellence, andstability of programs pursuant to Article 13 of the Environmental
Education Promotion Act

Cumulative number of children who have participated inLove the Earth Eco-creator Course

1,033children
Education hours for participating children in the Ecocreator Course in 2021

2,404 hours

Appendix

CEO Message

Brand Portfolio

About This Report

Chapter 1

Chapter 2

Chapter 3

Appendix

92

Purpose of the Report

Scope of the Report and Reporting Period

Third Party AssuranceThis report was created to disclose Amorepacific Group’s
sustainability management activities to stakeholders
transparently and collect various opinions to reflect
them in management. The scope of the AmorepacificSustainability Report, which has been issued annually
since 2009, was expanded in 2015 to be issued as
Amorepacific Group Sustainability Report with the aim of
expanding communication with stakeholders.

The scope of this report covers Amorepacific Group andall its subsidiaries (Amorepacific, innisfree, ETUDE,etc.). In the case of Amorepacific, the domestic businesssites (Amorepacific headquarters in Seoul, R&I Center in
Yongin, HR Development Center, Regional BU, and Amore
Beauty Park, Daily Beauty production site and OSULLOC
production site) were mainly under review, and, in somecases, includes performances of overseas subsidiaries. A
separate addendum was made when the reporting scope
standard was revised differently from the past standard.
The reporting period is from January 1 to December 31,
2021, with data from the past three years included forcomparative purposes in some parts of the report. Basedon the importance and timeliness of information, somedata included information from 2022.

In order to enhance the accuracy and reliability of thisreport, the content was verified by an independent
verification institution, DNV GL Business Assurance Korea
Ltd. The content was verified based on VeriSustainTM, aninternationally recognized assurance standard.

Reporting Standards
This report was prepared in accordance with thesustainability reporting guideline standards 2021 of
the Global Reporting Initiative (GRI) and is based on
indicators, including major agenda of the Sustainable
Development Goals (SDGs) and Amorepacific Group’s
internal reporting guidelines.

CEO Message

Brand Portfolio

Consolidated
Statements ofFinancial Position

Chapter 1

Chapter 2

Chapter 3

Appendix93

Summary(million KRW)

Category

AmorepacificAmorepacific Group

2021

2020

2021

2020

2,018,527

1,825,732

3,015,472

2,853,057

Cash and cash equivalents

537,694

793,728

870,595

1,190,926

Financial deposits

101,826

57,882

316,826

221,282

Financial assets at fair value through profit or loss

490,839

166,463

863,824

411,154

Trade receivables

295,769

283,770

311,951

306,676

Other receivables

41,647

24,72438,43932,584Current tax assets

3,331

19,236

8,431

22,045

Other current assets

50,13165,44658,52574,271Inventories

493,224

414,483

542,815

478,448

4,066

-

4,066

115,669

4,098,187

3,876,186

5,022,671

4,935,687

Financial deposits

19,513

17,55724,032

21,682Other receivables

115,163

100,547

126,171

136,561

Financial assets at fair value through net income

104,256

1,129

226,133

49,548

811

2,125

1,966

3,280

4,672

706

5,410

4,390

2,541,362

2,566,328

2,919,950

3,081,089

Investment Property

534,229

488,815

344,130

323,293

Right-of-use assets

146,466

227,453

164,555

288,383

Intangible assets

201,680

208,774

703,437

719,633

Investments in associates

238,445

52,514282,30760,621

The net defined benefit assets

94,730110,633

101,017

93,254

Deferred tax assets

84,60882,890109,593

134,878

Other non-current assets

12,252

16,714

13,97019,076

Total assets

6,116,714

5,701,918

8,038,143

7,788,744

Current liabilities

1,157,485

965,947

1,273,285

1,170,156

214,929

271,574

289,233

346,545

1,372,414

1,237,520

1,562,518

1,516,701

Share capital

34,52534,50847,99747,997

Share premium

720,481

712,702903,711

903,711

Capital surplus

75,353

10,807(209,370)(124,392)

Other components of equity(19,004)(117,632)(195,103)(196,032)

Accumulated other comprehensive income

11,879(20,279)(2,562)(13,647)

3,937,775

3,847,747

2,761,864

2,631,907(16,709)(3,456)

3,169,087

3,022,499

4,744,300

4,464,398

6,475,625

6,272,043

Current assets

Non-current assets as held for saleNon-current assets

Financial assets at amortized cost
Financial assets at fair value through other comprehensive income
Property, plant, and equipment

Non-current liabilities

Total liabilities

Retained earnings
Non-controlling interests

Total equity

CEO Message

Brand Portfolio

Consolidated
Statements ofComprehensive
IncomeChapter 1

Chapter 2

Chapter 3

Appendix

94

Consolidated Statements of Comprehensive Income
Category(KRW)

AmorepacificAmorepacific Group

2021

2020

2021

2020

Revenue

4,863,128,496,699

4,432,179,039,394

5,326,080,007,289

4,930,083,149,864

Cost of sales

1,362,639,202,428

1,265,398,064,748

1,461,565,391,981

1,371,125,560,674

Gross profit

3,500,489,294,271

3,166,780,974,646

3,864,514,615,308

3,558,957,589,190

Selling and administrative expenses

3,157,131,485,221

3,023,771,855,339

3,508,343,341,758

3,408,296,540,695

Operating profit

343,357,809,050

143,009,119,307

356,171,273,550

150,661,048,495

Finance income

10,499,109,599

11,882,548,495

21,061,314,624

23,224,981,543

Finance costs

11,410,260,207

17,026,833,385

14,322,950,770

22,912,945,354

Other non-operating losses, net(45,496,828,367)(113,231,972,208)

61,004,430,682(121,065,325,539)

Share of net profit of associates

927,626,457

660,159,537

5,660,108,316

1,376,674,276

Profit before income tax

297,877,456,532

25,293,021,746

429,574,176,402

31,284,433,421

Income tax expense

117,019,762,555

3,424,010,057

137,595,329,986

9,236,751,263

Profit for the year

180,857,693,977

21,869,011,689

291,978,846,416

22,047,682,158

Owners of the Parent Company

193,680,578,727

35,132,159,662

179,995,030,205

10,381,313,997

Non-controlling interests(12,822,884,750)(13,263,147,973)

111,983,816,211

11,666,368,161(15,641,140,883)

12,241,704,451--(47,369,483,250)

7,379,173,991(57,633,335,747)

10,075,519,263

109,285,659(306,779,895)

307,763,192(429,427,513)

Share of other comprehensive income of associates

260,637,659

141,746,006

227,434,393

141,746,006

Gain or loss on on currency translation of foreign
operations

31,358,419,049

5,027,564,349

31,359,475,764

5,355,904,949--(25,738,662,398)

15,143,742,705

165,216,553,094

34,110,716,140

266,240,184,018

37,191,424,863

Owners of the Parent Company

178,468,780,329

46,911,291,120

165,405,660,706

16,686,864,287

Non-controlling interests(13,252,227,235)(12,800,574,980)

100,834,523,312

20,504,560,576

Basic earnings per ordinary share

2,820

512

1,989

74

Basic earnings per preferred share

2,821

517

1,994

79

Profit attributable toPost-tax other comprehensive income (loss)
Items that will not be reclassified to profit or loss
Actuarial loss on postemployment benefit obligations
Financial assets at fair value through othercomprehensive income
Items that may be reclassified to profit or loss

Other comprehensive income (loss) for the period, net of tax
Total comprehensive income for the year
Attributable toEarnings per share attributable to owners of the Parent Company

CEO Message

Brand Portfolio

Board of Directors

Current Status of the Boards of Directors
The Amorepacific Group Board of Directors and theAmorepacific Board of Directors are both committed
to sound governance structures for the company’s
development, sustainable growth, and value creation
for stakeholders. In this process, a BOD centered on
independent directors is formed so that the board canperform independent functions from management andcontrolling shareholders. Directors are appointed at
the general shareholders’ meeting in consideration of
independence, diversity, and expertise. Further to that,
according to the company’s articles of incorporation,internal directors are appointed for terms of three
years, while an independent director’s term in office isdetermined by a resolution at a general shareholders’meeting, and ranges from one to three years.
Amorepacific Group Corporate Governance Articles ofIncorporation and Rules (in Korean)
Amorepacific Corporate Governance Articles ofIncorporation and Rules (in Korean)

Chapter 1

Chapter 2

Chapter 3

Appendix

Independence and Diversity of BODs

Committees under the BOD

Amorepacific Group and Amorepacific organize theirown respective board of directors, with a majority ofmembers serving as independent directors to strengthen
the independence of the BODs. The Independent
Director Nomination Committee, which consists entirelyof independent directors, verifies and recommends
candidates. The process of appointing directors follows
the Guidelines for the Independence of Directors, anddirectors who do not meet the requirements of thoseguidelines meet the qualification requirements for
directors as stipulated in relevant laws such as theCommercial Act. In addition, we appoint directors
with working experience and knowledge from various
backgrounds in accordance with our BOD Diversity
Guidelines, which states that discrimination cannot be
carried out due to gender, region, academic background,disability, nationality, or race. Moreover, independent
directors are not limited to specific areas, while external
experts in accounting, management strategy, foreign
affairs, marketing, and ESG participate in the BOD toenhance the expertise of the board and the committees
under the BOD.

There are seven committees under the BOD. They are
the Audit Committee, Independent Director Nomination
Committee, Internal Transaction Review Committee,
Compensation Committee, Management Committee,
Risk Management Committee, and ESG Committee.
Their responsibilities are as follows: the Audit Committeemonitors the company’s accounting and operations;the Independent Director Nomination Committee is
responsible for verifying and recommending outside
director candidates; the Management Committee
and the Risk Management Committee are responsible
for enhancing the expertise and efficiency of overallmanagement as well as preemptively managing
and responding to risks; the Internal Transaction
Review Committee and Compensation Committee
keep management in check; and the ESG Committee
strengthens ESG management. Each committee
contributes to the effective and careful discussion anddecision-making of the BOD by organizing its members
in consideration of the respective committee director’s
expertise, related experience of individual members, andkey role(s) of the committee.

Amorepacific Group (Board of) Directors’ Independence &Diversity Guidelines
Amorepacific (Board of) Directors’ Independence &Diversity Guidelines95

are planning to reconsider whether they will reevaluate
independent directors based on their individual
performance and reflect these reevaluation results when
deciding on their potential reappointment and possible
remuneration.

Amorepacific Group Shareholders(As of Dec. 31, 2021, %)Category

Proportion

Major shareholder and affiliated parties

62.9

Foreign institutional investors

15.8

Individual investors

7.7

Treasury stock

7.5

Domestic institutional investors

6.1

Amorepacific Shareholders(As of Dec. 31, 2021, %)BOD Evaluation and Remuneration

Category

In order to strengthen accountability of the BOD and
improve its efficiency, all directors, including independent
directors, conduct an annual evaluation of the BOD’s
activities. In order to ensure fairness, the evaluation items
are organized according to BOD evaluation guidelines assubmitted by the Korea Corporate Governance Service.
The board’s remuneration is determined after considering
the size of the company and the level of remuneration in
the same industry. Amorepacific Group and AmorepacificAmorepacific Group

38.0

Foreign institutional investors

29.1

Major shareholder and affiliated parties

14.1

Individual investors

9.6

Domestic institutional investors

9.0

Treasury stock

0.2

Proportion

CEO Message

Brand Portfolio

Chapter 1

Chapter 2

Chapter 3

Appendix

96

Amorepacific Group BOD
Category

Internal
Directors

Independent
Directors

Name(As of May 2022, : Chairperson, : Member)

Position

Area of Expertise

GenderDate of the First
Appointment

Suh Kyung-bae

CEO, Amorepacific Group

Business Administration

M

March 1997

Kim Seung-hwan

CEO, Amorepacific Group

Business Administration

M

March 2013

Choe Jong-hak

Professor, College of Business Administration, Seoul National University

Accounting

M

March 2019

Kim Eon-soo

Professor, Department of Business Administration, Korea University

Business Strategy

M

March 2020

Kim Young-sun

Visiting Researcher, Seoul National University Asia Center

Foreign Affairs

M

March 2020

Lee Kyoung-mi

Professor, Department of Business Administration, Seoul National University

MarketingF

March 2020

Committees under the BOD
Audit
Committee

Independent Director
Nomination Committee

Internal Transaction
Review Committee

Compensation
Committee

Amorepacific BOD
Category

Internal
Directors

Independent
Directors

NameManagement
Committee

Risk Management
Committee

ESG
Committee(As of May 2022, : Chairperson, : Member)

Position

Area of Expertise

GenderDate of the First
Appointment

Suh Kyung-bae

CEO, Amorepacific

Business Administration

M

June 2006

Ahn Sae-hongCEO, Amorepacific

Business Administration

M

March 2018

Lee Dong Soon

Executive Vice President, SCM Unit, Amorepacific

SCM

M

March 2021

Lee Sang-mok

Head of Business Support Unit, Amorepacific

Business Administration

M

March 2013

Lee Hwi-seong

Senior Advisor, Innovative Company Sellwe

IT

M

March 2019

Cha Sang-kyun

Dean and Professor, Graduate School of Data Science, Seoul National University

ICT

M

March 2020

Cho Seong Jin

Professor, College of Economy, Seoul National University

EconomyM

March 2021

Kim Jong-dae

Professor, Department of Business Administration; Department Chair, Green Finance
Graduate Program at Inha University

ESG

M

March 2022

Ahn Hee-joon

Professor and Dean, College of Business Administration and Business School at
Sungkyunkwan University

Finance

M

March 2022

Choe In-a

Visiting Editorial Writer, The Dong-a Ilbo; CEO, Choi Ina Books

MarketingF

March 2022

Committees under the BOD
Audit
Committee

Independent Director
Nomination Committee

Internal Transaction
Review Committee

Compensation
Committee

Management
Committee

Risk Management
Committee

ESG
Committee

CEO Message

Employment
StatusBrand Portfolio

Chapter 1

Chapter 2

Chapter 3

Appendix

97

Employment Status
Amorepacific Group Employment Status
Category(persons)

2019

2020

2021

Total

13,257

12,387

11,171

Domestic

7,603

7,288

6,602

Overseas

5,654

5,099

4,569

Amorepacific Employment Status
Category
No. of employees(persons)

Employee ratio (%)

No. of managers(persons)

Ratio of managerial
positions within eachregion (%)

2019

2020

2021

Korea

5,976

5,747

5,318

Asia

5,381

4,874

4,367

North America

195

156

139

Europe & Others

78

69

63

Total

11,63010,846

9,887

Korea

51.4

53.0

53.8

Asia

46.3

44.9

44.2

North America

1.7

1.4

1.4

Europe & Others

0.7

0.6

0.6

Korea

882

944

1,212

Asia

181

196

269

North America

23

19

30

Europe & Others

9

7

11

Total

1,095

1,166

1,522

Korea

14.8

16.4

22.8

Asia

3.4

4.0

6.2

North America

11.8

12.2

21.6

Europe & Others

11.5

10.1

17.5

Average

10.4

10.7

17.0

CEO Message

Brand Portfolio

Chapter 1

Chapter 2

Domestic Employment Status
Category

Employment Status

GenderAge Group

Chapter 3(persons)

Amorepacific Group

AmorepacificAppendix98

Amorepacific Group Employment and Turnover (Domestic)
Category

2019

2020

2021

2019

2020

2021

2019

2020

2021

New Employees (persons)

744

431

486

Permanent1)

7,215

6,970

6,203

5,700

5,521

5,020

Voluntary Turnover Rate (%)

5.9

13.3

13.8

Temporary2)

388

318

399

276

226

298

Men

2,689

2,607

2,417

1,898

1,840

1,853

Amorepacific Employment and Turnover (Domestic)

Women

4,914

4,681

4,185

4,078

3,907

3,465

Category

2019

2020

2021

< 30 years old

2,288

1,743

1,289

1,788

1,364

954

New employees (persons)

459

286

318

30-50 years old

5,047

5,248

5,041

3,992

4,168

4,145

Internal employment rate for open

12.9

32.6

41.8

> 50 years old

268

297

272

196

215

219

positions (%)1)

96

109

104

87

109

102

Average employment cost

49.8

114.3

187.4

Total turnover rate (%)

6.0

14.9

14.8

Voluntary turnover rate (%)

5.2

14.5

14.5

Employees with Disabilities3)

Employment(10,000 KRW)

Employment Status in Overseas Offices
Category

Turnover Rate

2019

2020

2021

Total

5,493

4,939

4,434

Asia

5,242

4,737

4,244

Europe & Others

69

61

57

North America

182

141

133

Local Employment Ratio (%)

97.2

96.9

97.0

Ratio of Local Female Employees (%)

85.5

84.8

84.7

Ratio of Local Managers (%)

59.6

58.6

66.8

Ratio of Local Female Managers (%)

75.6

76.2

77.8

Number of Local
Employees (persons)

1) Managers included
2) Contract workers and interns included but dispatched workers not included3) Including the number of employees with disabilities hired by the Amorepacific subsidiary WeDream

1) Internal employment rate for open positions and average employment cost calculated on the basis of permanent employees

CEO Message

Employment
Diversity

Brand Portfolio

Chapter 1

Chapter 2

Chapter 3

Appendix

Securing Female Leadership

Amorepacific Group Female Leadership

Amorepacific Group is committed to securing female
leadership, as the majority of consumers in the cosmetics
industry are women. As a result, it maintains a highproportion of female employees as a private company.

Category

To secure women leadership, the Group is focusing on
creating a corporate culture where employees in all
genders work with other employees with consideration.
The Group also introduced flexible working hours as apolicy to ensure the maximum efficiency of work and finda balance between work and life.

FemaleEmployees

FemaleManagers

99

2019

2020

2021

72.5

71.8

71.2

Employees (persons)

13,257

12,387

11,171

Female employees (persons)

9,613

8,891

7,958

Ratio of female managers (%)

33.6

35.3

39.8

Total number of managers (persons)

1,361

1,466

1,792

457

517

714

Ratio of female employees (%)

Total number of female managers (persons)CEO Message

Brand Portfolio

Chapter 1

Chapter 2

Chapter 3

Amorepacific Female Leadership
Category
FemaleEmployees

FemaleManagers

2019

2020

2021

75.5

74.8

73.2

Employees (persons)

11,63010,846

9,887

Female employees (persons)

8,777

8,117

7,238

Ratio of women with revenue-generating positions (%)

-

79.1

80.1

Ratio of women with STEM-related positions (%)

-

50.1

51.4

Ratio of female managers (%)

35.5

37.7

39.9

Total number of managers (persons)

1,095

1,166

1,522

Ratio of female employees (%)

Total number of female managers (persons)

389

439

608

Ratio of top female managers (%)

-

23.9

22.8

Ratio of junior-level female managers (%)

-

43.2

42.2

-

-

39.4

Executive position (Base pay)

-

90.2

89.2

Executive position (Total)

-

88.7

92.0

Managerial position (Base Pay)

-

98.3

96.8

Managerial position (Total)

-

98.3

94.1

Non-managerial position

-

95.8

96.7

Ratio of female managers with revenue-generating
positions (%)
Equal Pay
(Ratio of wage
for femalecompared to
male)

CSR

Appendix

100

Donation and Membership Fee Expenditures
Employee volunteer activities are mainly recommended
on a team or organization basis. The number ofparticipants and total time of participation in volunteer
activities have significantly decreased recently, as teamand organization-based activities became difficult tocarry out due to the prolonged COVID-19 regulations.
In line with the post-COVID-19 era, Amorepacific Group
has shifted from volunteer activities centered on timeand participation rates to other types of ways employees
can help, such as pro bono activities as well as brand andchannel CSR campaigns based on their expertise andwillingness to carry out initiatives of their own volition.
Amorepacific’s cash donation ratio is higher than its
in-kind donation ratio, but that is not intentional.
Rather, it reflects the needs of the company’s sponsoredorganizations, which prefer cash donations to in-kind
donations. In 2020, in-kind donations were more than
three times higher than in 2019. That was due to the
spread of COVID-19, which subsequently led to theinterest in the hygiene of local communities and welfare
facilities increasing in 2020. Along with this, Amorepacificcontinues to provide daily supplies for local communities
through its “Beautiful Goods Sharing” campaign.

CEO Message

Brand Portfolio

Chapter 1

Chapter 2

Amorepacific Group CSR Activities
Category
Expenditures on CSR
activities
Employee Volunteer
Activities

Policy-related Expenditures(million KRW)

2019

2020

2021

23,61018,601

17,219Ratio Compared to Sales (%)

0.38

0.38

Participation Rate (%)

64.8

Average Hours of Volunteering

Appendix

101

Value of CSR Activities(million KRW)

2019

2020

2021

Cash Donation

15,132

10,48011,591

0.33

In-kind Donation

899

3,089

1,332

39.9

28.8

Management Overhead

4,594

2,994

3,101

6.9

4.3

2.8

1,086

1,002

915

Major Related Association Membership Fees in 2021

Amorepacific Welfare Foundation

816

692

628

Name of Association

StatusAmountBusiness Impact

Korea Breast Cancer Foundation

3,042

708

1,769

Korea Door-to-door Sales Development Association

Member

1,380

High

innisfree Moeum Foundation

602

75

202

Korea Cosmetic Association

Member

179

High

0

0

0

Korea Direct Selling Industry Association

Member

47.5

High

2,656

1,604

1,635

UN Global Compact Network Korea

Member

16.5

High

0

0

0

Korea Health Supplements Association

Member12

High

Amount of Expenditure

Disbursement of Funds from Amorepacific Foundation
Public Foundations

Chapter 3

Political Donations and Lobbying Efforts
Major related Association Membership Fees
Ballot Measures, Referendums

Category(million KRW)CEO Message

Brand Portfolio

Occupational
Safety and Health

Chapter 1

Chapter 2

Chapter 3

Appendix

Amorepacific Group Occupational Safety and HealthCategory
Fatal accidents (cases)
Accident rate

(%)

2019

2020

2021

0

0

0

0.051

0.065

0.145

Amorepacific Occupational Safety and HealthCategory
Amorepacific(total)Amorepacific(Domestic)

Amorepacific(Mainland
China)

Amorepacific In-house Contractors’ Occupational Safety and HealthCategory
Amorepacific(total)

(%)

2019

2020

2021

0

0

0

Accident rate1)

0.050

0.065

0.144

LTIFR2)

0.261

0.338

0.747

Occupational disease rate

0.000

0.000

0.000

Accident rate

0.065

0.068

0.150

LTIFR

0.340

0.353

0.782

Occupational disease rate

0.000

0.000

0.000

Accident rate

0.000

0.055

0.122

LTIFR

0.000

0.289

0.634

Occupational disease rate

0.000

0.000

0.000

Fatal accidents (cases)

1021) Accident rate: The rate of accident victims per 100 workers (accident victims/average number of workers per year×100)2)	Lost Time Injuries Frequency Rate (LTIFR): The number of lost time injuries occurring in a workplace per 1 million hours
worked (Total cases of accidents/annual hours worked×1,000,000)

Amorepacific(Domestic)

Amorepacific(Mainland
China)

(%)

2019

2020

2021

0

0

0

Accident rate1)

0.040

0.049

0.131

LTIFR2)

0.206

0.253

0.681

Occupational disease rate

0.000

0.000

0.000

Accident rate

0.033

0.038

0.374

LTIFR

0.172

0.198

1.947

Occupational disease rate

0.000

0.000

0.000

Accident rate

0.042

0.052

0.017

LTIFR

0.217

0.272

0.091

Occupational disease rate

0.000

0.000

0.000

Fatal accidents (cases)

CEO Message

Environmental
Data

Brand Portfolio

Chapter 1

Chapter 2

Chapter 3

Appendix

Amorepacific Group Energy Consumption
Category
Amorepacific(Domestic)

2019

2020

2021

Diesel

1.6

1.3

1.1

LNG

164.5

178.9

177.8

5.1

4.1

3.8

Electric power (Non-renewable)

786.6

741.9

770.6

Electric power (Renewable)

48.5

42.3

75.2

Total

1,006.3

968.5

1,028.5

Diesel

0.0

0.0

0.0

LNG

17.4

14.0

17.7

Gasoline

0.4

0.3

0.2

Electric power (Non-renewable)

86.9

63.3

0

Electric power (Renewable)

0.6

0.6

99.5

Gasoline

Amorepacific(Shanghai)1)

Total
AmorepacificGroup2)(TJ)

Diesel
LNG

105.3

78.2

4.5
244.9

4.1
217.4

103

Amorepacific Group GHG Emissions (Scope 1, 2)
Category
Amorepacific(Domestic)

Amorepacific(Shanghai)

COSVISIONPACIFICPACKAGE

117.4
3.9
210.5

OSULLOC Farm(tCO2e)

2019

2020

2021

Scope 1

10,279

9,301

9,353

Scope 237,81735,702

36,740Total

48,09645,00346,093

Scope 1884

703

1,610(0) 1)

Scope 2

4,917

6,620

0

Total

5,801

7,323

1,610(0)1)

Scope 1

889

658

768

Scope 2

3,445

2,785

3,306

Total

4,334

3,443

4,074

Scope 1

323

225

215

Scope 2

3,672

3,116

3,314

Total

3,995

3,341

3,529

Scope 1

2,296

2,416

1,901

Scope 2

1,162

1,187

1,115

Total

3,458

3,603

3,016

Scope 1

14,671

13,303

13,846(12,236)

LPG

10.7

9.4

8.8

Gasoline

5.3

4.4

4.3

Kerosene

26.4

27.9

20.6

1,058.9

1,009.6

932.2

Scope 251,01349,41044,474

48.5

42.3

174.7

Total

65,68462,71358,322(56,712)

1,399.2

1,315.2

1,355.1

Electric power (Non-renewable)
Electric power (Renewable)

Total
1) Scope 1 emissions offset by purchasing CER2) Amorepacific (Domestic, Shanghai), PACIFICPACKAGE, COSVISION, and OSULLOC Farm included

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Chapter 1

Chapter 2

Chapter 3

Appendix

104

Amorepacific GHG Emissions (Scope3)(tCO2e)Water Resource Management at Amorepacific Group Production Sites

Category

2021

Category

Activities related to fuel and energy

1,999

Amorepacific Water Withdrawal
by Source of Water

Upstream transportation and logistics

687

Upstream

Downstream

Total

Wastes from operation processes

150

Employees’ commuting

985

Disposal of products sold

2,605

Downstream rental properties

2,894

9,320

(ton)

2019

2020

20211)

Total

517,276475,653

488,048

Municipal water (tap water)

437,323401,243

418,609

Industrial water

34,892

39,13330,322Ground water

6,562

1,675

2,061

Rainwater

38,49933,60237,056

Recycling

31,322

13,81535,820

Water Discharge

296,566

270,517

287,785

5.021

5.204

4.977

Intensity of Water Withdrawal(tonne/tonnes of production)
Amorepacific Water WithdrawalGroupby Business Site

1,113,792

901,673797,271

Amorepacific517,276475,653

488,048

AESTURA

27,526

24,656-

PACIFICPACKAGE

18,94015,831

14,083COSVISION

71,772

57,78068,406

OSULLOC Farm

373,353

238,852

226,733

PACIFICGLAS

104,925

88,901-

Municipal water (tap water)

658,430

585,914499,500

Industrial water

34,892

39,13330,322Ground water

381,971

243,024

230,393

Rainwater

38,49933,60237,056

Water Recycling

33,16916,02835,820

Water Discharge

469,969

395,818

333,855

8.059

7.444

7.023

Water Withdrawal
by Source of Water

Total

4.996 (2021 Goal)

Intensity of Water Withdrawal(tonne/tonnes of production)1)	In 2021, the changed business scope was applied as a result of the merger and sale.
(Amorepacific merged AESTURA, a subsidiary of Amorepacific Group, and Amorepacific Group sold its stake in PACIFICGLAS.)

7.146 (2021 Goal)

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Chapter 1

Chapter 2

Amorepacific Group Waste Generation and Recycling at Production Sites
Waste Generation by Production Site

Chapter 3

Appendix

105

(ton)

(ton)

2019

2020

20211)

Waste Amount by Disposal Method

2019

2020

20211)

Amorepacific

10,249

7,774

8,260

Amorepacific

9,012

6,602

7,023

AESTURA

175

146

-

Recycling

7,957

5,636

6,177

COSVISION

610

528

558

Incineration

974

961

843

PACIFICPACKAGE

368

318

217

Landfill80

54

OSULLOC Farm

2

2

1

1,237

1,172

1,237

PACIFICGLAS

1,758

1,358

-

Recycling

1,124

1,082

1,102

Amorepacific Group

13,164

10,126

9,036

Incineration

114

90

135

-

-

-

89

86

88

11,274

8,400

7,434

Recycling

9,704

7,045

6,512

Incineration

1,488

1,348

917

82

7

5

1,889

1,726

1,603

Recycling

1,351

1,284

1,317

Incineration

513

417

286

Landfill

25

25

-

84

82

87

General Waste

Designated
Waste

Landfill
Recycling Rate (%)
Amorepacific Group

General Waste

Landfill
Designated
Waste

Recycling Rate (%)1)	In 2021, the changed business scope was applied as a result of the merger and sale.
(Amorepacific merged AESTURA, a subsidiary of Amorepacific Group, and Amorepacific Group sold its stake in PACIFICGLAS.)

1)	In 2021, the changed business scope was applied as a result of the merger and sale.
(Amorepacific merged AESTURA, a subsidiary of Amorepacific Group, and Amorepacific Group sold its stake in PACIFICGLAS.)CEO Message

Brand Portfolio

Chapter 1

Chapter 2

Amorepacific Group Pollutant Management at Production Sites
Category
Amorepacific

AESTURACOSVISIONPACIFICPACKAGE

OSULLOC Farm

PACIFICGLAS

Amorepacific Group

Chapter 3(ton)Appendix106

Amorepacific Group Environmental Operations and Investments

2019

2020

20211)

Dust

1.5

0.8

1.0

SOx

-

-

-

NOx

10.3

9.6

8.0

COD

11.3

10.1

9.3

Dust

0.1

0.1

-

SOx

-

-

-

Significant Violations of Environmental Regulations and Fines/Penalties

NOx

-

-

-

COD

0.5

-

-

Category

Dust

0.3

0.1

0.2

SOx

-

-

-

NOx

-

1.4

1.1

COD

2.3

1.8

2.2

Dust

-

-

-

SOx

-

-

-

NOx

-

-

-

COD

-

-

-

Dust

-

0.1

0.1

SOx

-

-

-

NOx

-

-

-

COD

-

-

-

Dust

0.3

0.2

-

SOx

19.3

17.5

-

NOx

12.4

9.0

-

COD

1.5

0.8

-

Dust

2.2

1.5

1.4

SOx

19.3

17.5

-

NOx

22.7

20.0

9.1

COD

15.2

13.0

11.6

1)	In 2021, the changed business scope was applied as a result of the merger and sale.
(Amorepacific merged AESTURA, a subsidiary of Amorepacific Group, and Amorepacific Group sold its stake in PACIFICGLAS.)(100 million KRW)

Category

2019

2020

20211)

Amorepacific

33.1

25.3

35.0

Amorepacific Group

49.3

39.5

37.3

Number of Significant
Violation Cases
Amount of fines/penalties(cases, KRW)

2019

2020

2021

Amorepacific

0

0

0

Amorepacific Group

0

0

0

Amorepacific

0

0

0

Amorepacific Group

0

0

0

Amorepacific Environmental Education(person, hour)

Category

2020

2021

Number of Participants

165

3,516

1,090

3,086

Education Time1)	In 2021, the changed business scope was applied as a result of the merger and sale.
(Amorepacific merged AESTURA, a subsidiary of Amorepacific Group, and Amorepacific Group sold its stake in PACIFICGLAS.)CEO Message

Brand Portfolio

GRI Standards
Index

Chapter 1

Chapter 3

Appendix

107

General Disclosures
Category

Disclosure

Description

Report Pages and Comments

The Organization and
Its Reporting Practices

2-1

Organizational details

12

2-2

Entities included in the organization’s sustainability reporting

4-8, 92

2-3

Reporting period, frequency and contact point

92, 118

2-4

Restatements of information

PACIFICGLAS excluded from subsidiaries in accordance with the sale of its shares; AESTURA
and COSVISION withdrawing from subsidiaries

2-5

External assurance

113-116

2-6

Activities, value chain and other business relationships

12, 20-21

2-7

Employees

12, 61-64, 97-100

2-8Workers who are not employees

98

2-9

Governance structure and composition

50, 95-96

2-10

Nomination and selection of the highest governance body

95

2-11

Chair of the highest governance body

96

2-12

Role of the highest governance body in overseeing the management of impacts

50

2-13

Delegation of responsibility for managing impacts

50

2-14

Role of the highest governance body in sustainability reporting

50

2-15

Conflicts of interest

95

2-16

Communication of critical concerns

54-56, Amorepacific Group Business Report 274

2-17Collective knowledge of the highest governance body

95-96

2-18

Evaluation of the performance of the highest governance body

95

2-19

Remuneration policies

50, 95, Amorepacific Group Business Report 294

2-20

Process to determine remuneration

95, Amorepacific Group Business Report 293-297

2-21

Annual total compensation ratio

Non-disclosure (Confidential)

2-22

Statement on sustainable development strategy

3, 10-11

2-23

Policy commitments

64-65

2-24

Embedding policy commitments

66

2-25

Processes to remediate negative impacts

54-56, 67

2-26

Mechanisms for seeking advice and raising concerns

51-53

2-27

Compliance with laws and regulations

51-53, Amorepacific Group Business Report 312

2-28

Membership associations

49, 101

2-29

Approach to stakeholder engagement

49

2-30

Collective bargaining agreements

65-66

3-1

Process to determine material topics

44

3-2

List of material topics

45

3-3

Management of material topics

46-48

Activities and Workers

Governance

Strategy, Policies
and Practices

Stakeholder Engagement

Material topics
Amorepacific Group has reported in accordance with the GRI Standards forthe period from 1 January 2021 to 31 December 2021.

Chapter 2

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Chapter 1

Chapter 2

Chapter 3

Appendix

108

Topic-specific Disclosures

Environmental Standard Disclosures (GRI 300)

Economic Standard Disclosures (GRI 200)

Category

Disclosure

Description

Report Pages and Comments

Materials

301-3

Reclaimed products and their packaging materials

40, 48, 58-59

Energy302-1

Energy consumption within the organization

16, 35-37, 103

302-2

Energy consumption outside of the organization

16, 35-37, 104

302-4

Reduction of energy consumption

16-17, 35-37, 87-88

302-5

Reductions in energy requirements of products and services

17, 26-29, 47

303-1

Interactions with water as a shared resource

26, 28, 88-89, 104

303-2

Management of water discharge-related impacts

89

303-3

Water withdrawal

104

303-4

Water discharge

104

303-5

Water consumption

88, 104

304-1

Operational sites owned, leased, managed in, or adjacent to, protectedareas and areas of high biodiversity value outside protected areas

89

304-2

Significant impacts of activities, products, and services on biodiversity

42, 89304-3

Habitats protected or restored

42, 89305-1

Direct (Scope 1) GHG emissions

87-88, 103

305-2

Energy indirect (Scope 2) GHG emissions

87-88, 103

305-3

Other indirect (Scope 3) GHG emissions

87-88, 104

305-5

Reduction of GHG emissions

35-37, 87-88

305-7

Nitrogen oxides (NOx), sulfur oxides (SOx), and othersignificant air emissions

89, 106

306-1

Waste generation and significant waste-related impacts

48

306-2

Management of significant wasterelated impacts

48

306-3

Waste generated

105

306-4

Waste diverted from disposal

89, 105

306-5

Waste directed to disposal

89, 105

308-1

New suppliers that were screened using environmental criteria

81

308-2

Negative environmental impacts in the supply chain and actions taken

80-82

Category

Disclosure

Description

Report Pages and Comments

Economic
Performance

201-1

Direct economic value generated and distributed

12, 93-94, 101

201-2

Financial implications and other risks and opportunities due 56, 86
to climate change

Indirect Economic 203-1
Impacts203-2
Procurement
Anti-corruption

Anti-competitive
Behavior
Tax

204-1

Infrastructure investments and services supported

74-78, 100-101

Significant indirect economic impacts

74-78, 100-101

Proportion of spending on local supplies

81

205-1

Operations assessed for risks related to corruption

205-2

Communication and training about anti-corruption policies 51-53
and procedures

205-3

Confirmed incidents of corruption and actions taken

206-1

Legal actions for anti-competitive behavior, anti-trust, andmonopoly practices

51-53
Biodiversity

53
Amorepacific Group Business
Report 312-316

207-1

Approach to tax

57

207-2

Tax governance, control, and risk management

57

207-3

Stakeholder engagement and management of concerns
related to tax

57

Country-by-country reporting

57

207-4

Water

EmissionsEffluents andWaste

Supplier
Environmental
Assessment

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Chapter 1

Chapter 2

Chapter 3

Appendix

109

Social Standard Disclosures (GRI 400)
Category

Disclosure

Description

Report Pages and Comments

Category

Disclosure

Description

Report Pages and Comments

Employment

401-1

New employee hires and employee turnover

98

406-1

Incidents of discrimination and corrective actions taken

53

401-2

Benefits provided to full-time employees that are not provided
to temporary or part-time employees

61-64

Nondiscrimination

407-1

Parental leave

64

Operations and suppliers in which the right to freedom of
association and collective bargaining may be at risk

65, 81-82

401-3
403-1

Occupational safety and health management system

68

Freedom of
Association
and Collective
Bargaining

403-2

Hazard identification, risk assessment, and incident
investigation

54-56, 68-70

Child Labor

408-1

Operations and suppliers at significant risk for incidents ofchild labor

65, 81-82

403-3

Occupational health services

63-64, 71

Forced or
409-1
Compulsory Labor

Operations and suppliers at significant risk for incidents offorced or compulsory labor

65, 81-82

403-4

Worker participation, consultation, and communication on
occupational safety and health

70-71

Local
Communities

413-1

Operations with local community engagement, impact
assessments, and development programs

74-78, 101

403-5

Worker training on occupational safety and health

70

414-1

New suppliers that were screened using social criteria

82

403-6

Promotion of worker health63-64, 71

Supply Social
Assessment

414-2

Negative social impacts in the supply chain and actions taken 80-82

403-7

Prevention and mitigation of occupational safety and healthimpacts directly linked by business relationships

68-70, 81-82

Public Policy

415-1

Political contributions

101

403-8

Workers covered by an occupational safety and healthmanagement system

68, 102

Customer Safety

416-1

Assessment of the safety and health impacts of product andIntegrated Quality Control

service categories

Process403-9

Work-related injuries

102

416-2

Incidents of non-compliance concerning the safety andhealth impacts of products and services

71403-10Work-related ill health

102

417-2

Training and
Education

404-1

Average hours of training per year per employee

61

Incidents of non-compliance concerning product and service
information and labelingAmorepacific Group Business
Report 313-315

404-2

Programs for upgrading employee skills and transition
assistance programs

61-62

417-3

Incidents of non-compliance concerning marketing
communications

Amorepacific Group Business
Report 312-315

Diversityand Equal
Opportunity

405-1

Diversity of governance bodies and employees

95-96, 97-100

418-1

There was no serious case405-2

Ratio of basic salary and remuneration of women to men

100

Substantiated complaints concerning breaches of customer
privacy and losses of customer data

Occupational
Safety and
Healthand HealthMarketing andLabeling

Customer Privacy

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Ten Principles of
the UNGC

Chapter 1

Chapter 2

Chapter 3

Appendix

110

Ten Principles of the UNGC and Amorepacific Group’s Activities
Category
Human Rights

LabourEnvironment

Anti-Corruption

Amorepacific Group’s Principles and Activities

Reporting Pages and Related Info

Amorepacific Group supports the Universal Declaration of Human Rights
and UN Guiding Principles on Business and Human Rights; Ruggie
Framework.

64-66

Principle 1

Businesses should support and respect theprotection of internationally proclaimed
human rights; andPrinciple 2

make sure that they are not complicit inhuman rights abuses.

Principle 3

Businesses should uphold the freedom of
Amorepacific Group supports the employees’ right to join and leave theassociation and the effective recognition of the labor union and build trust between the management and the employees
right to collective bargaining;
through communication.

65-66

Principle 4

the elimination of all forms of forced andcompulsory labour;

30, 65-66, 80-82

Principle 5

the effective abolition of child labour; andAmorepacific Group strictly prohibits any form of child labor, involuntaryor forced labor and discrimination throughout its entire business process,and conducts annual on-site reviews of the company and its suppliers.

Principle 6

the elimination of discrimination in respect of
employment and occupation.

Principle 7

Businesses should support a precautionary
approach to environmental challenges;

16-18, 25-29, 34-42, 58-60, 83-90,
106

Principle 8

undertake initiatives to promote greater
environmental responsibility; andPrinciple 9

encourage the development and diffusion ofenvironmentally friendly technologies.

Amorepacific Group contributes to solving environmental problems
and achieving a circular economy by making efforts such as introducing
renewable energy to realize carbon neutrality at the Group’s global
production sites by 2030, reducing waste with the development ofsustainable packages, and expanding the use of RSPO-certified palm oil
to preserve biodiversity.

Principle 10

Businesses should work against corruption in
all its forms, including extortion and bribery.

Amorepacific Group conducts ethical management based on its code of
ethics to promote ethical practice and raise awareness throughout thecorporate ecosystem.

51-53

CEO Message

TCFD

Brand Portfolio

Chapter 1

Chapter 2

Chapter 3

Appendix

111

TCFD Checklist
TCFD Recommendations
Governance

Strategya)The organization’s governance around climate-related risks and opportunities.

50, 83, 88b)Management’s role in assessing and managing climate-related risks and opportunities.

50, 83, 88a)

The climate-related risks and opportunities the organization has identified over the short, medium, and long term.

84-86

b)

The impact of climate-related risks and opportunities on the organization’s businesses, strategy, and financial planning.

84-86

c)

The resilience of the organization’s strategy, taking into consideration different climate-related scenarios.

84-86

The organization’s processes for identifying and assessing climate-related risks.

44-48, 54-56, 86b)The organization’s processes for managing climate-related risks.

44-48, 54-56, 86c)

How processes for identifying, assessing, and managing climate-related risks are integrated into the organization’s overall risk
management.

44-48, 54-56, 86

a)

The metrics used by the organization to assess climate-related risks and opportunities in line with its strategy and risk
management process.

87, 103b)Disclose Scope 1, Scope 2 and, if appropriate, Scope 3 greenhouse gas (GHG) emissions and the related risks.

87, 103c)

The targets used by the organization to manage climate-related risks and opportunities and performance against targets.

87, 103

Risk Management a)

Metrics andTargets

CDP Index

CEO Message

SASB

Brand Portfolio

Chapter 1

Chapter 2

Chapter 3

Appendix112

Sustainability Disclosure Topics & Accounting Metrics
Code

Topic

Accounting MetricPages and Description

CG-HP140a.1

Water
Management(1) Total water withdrawn

104(2) Total water consumption

104(3) Percentage of (1) and (2) in regions with high or extremely
high baseline water stress

The Group has no production site in regions with high baseline water stress, based on the WRI’sstandards.

Description of water management risks and discussion ofstrategies and practices to mitigate those risks

88, The Group has low risks in water use (located in regions with low baseline water stress), but willreinforce water management—e.g. by assessing risks in water use on a mid-and long-term basis.

Revenue from products that contain REACH substances of very
high concern (SVHC)

Substances other than cyclosiloxane (D5, D6) are not used, and D5 and D6 are also managed before
being regulated, while alternative raw materials and prescriptions are being developed.

CG-HP250a.2

Revenue from products that contain substances on the California
DTSC Candidate Chemicals List

Only substances and raw materials of the quality suitable for safe cosmetics are partly selected andused according to the standards.

CG-HP250a.3

Discussion of process to identify and manage emerging materials
and chemicals of concern

89

CG-HP250a.4

Revenue from products designed with green chemistry principles

27, Products applied with a low energy emulsification process, waste reduction technology (green
technology certification), and eco-friendly solvent application process are continuously being
developed according to sustainable product standards.

(1) Total weight of packaging

24, 39-40(2) Percentage made from recycled and/or renewable materials

38, 58-59

CG-HP140a.2
CG-HP250a.1

CG-HP410a.1

Product EHS
Performance

Packaging
Lifecycle
Management

CG-HP410a.2
CG-HP430a.1

prepared and thoroughly operated. Substances on the lists such as on CA pro.65 list and WA CHCC are
generally not used, and are more strictly limited than national regulations in the EU, U.S., and Korea.
The Group operates a process of reviewing and determining the suitability of human andenvironmental impacts when introducing new substances. In order to strengthen customer safety,
details related to safe quality integration processes are disclosed.

(3) Percentage that is recyclable, reusable, and/or compostable
Discussion of strategies to reduce the environmental impact of
packaging throughout its lifecycle

Environmental &Social Impacts ofPalm Oil Supply
Chain

Amount of palm oil sourced, percentage certified through theRoundtable on Sustainable Palm Oil (RSPO) supply chains as (a)Identity Preserved, (b) Segregated, (c) Mass Balance, or (d) Book
& Claim, In-house safety standards that are stricter than legal or academic safety standards are24CEO Message

Independent
Assurance
Statement

Brand Portfolio

Chapter 1

Chapter 2

Introduction
Amorepacific Group, Inc. (“the Company” or “APG”)
commissioned DNV Business Assurance Korea, Ltd.
(“DNV”, “we” or “us”), part of DNV Group, to undertake
independent assurance of its 2021 AmorepacificSustainability Report, ‘A More Beautiful World’ (the“Report”).

Our Opinion
On the basis of the work undertaken, nothing came to ourattention to suggest that the Report does not properly
describe APG’s adherence to the Assurance Principles
described below. In terms of reliability of the performancedata, nothing came to our attention to suggest that thesedata have not been properly collated from information
reported at operational level, nor that the assumptions
used were inappropriate. APG complied with nine
requirements of GRI Standards 2021, and DNV believes
that the Report has been prepared in accordance with the
GRI Standards.

Chapter 3

Appendix

113

Based on non-financial data, sustainability activities andperformance data of 2021 generated from the Company,
DNV has assessed the requirements of GRI Standards
2021 including the Sustainability Reporting Principles
and the quality of sustainability performance information.
DNV has found that the material topics which are
identified by the Company’s materiality assessment
process are linked to relevant topic-specific disclosures of
GRI Standards as follows:

No.

Material Topic

Topic Standard

1

Product Innovation and
Digitalization

GRI 202-1

2

Developing Eco-friendly
Products and Services

GRI 302-5

3

Waste Management andCircular Economy

GRI 301-3, 306-1

Without affecting our assurance opinion, we also provide
the following observations:Sustainability Context
APG declared the “A MORE Beautiful Promise” (“AMBP”),
the five commitments for 2030 sustainable management
goals under the group mission of “We make A MORE
beautiful world” and “ABC Spirit” consisting of fiveprinciples. AMBP is classified into “Move Forward
Together with Customers and Society” and “Coexist
Responsibly with Nature.” Through the Report, thecompany discloses 2030 goals and key performances in
2021 of each AMBP strategy. In addition, related activities
and its environmental impacts are disclosed in detail, andeach report content is consistent with the core tasks of the
AMBP strategy.

Completeness
APG provides stakeholders with information on
activities and performance on material topics in terms ofsustainability management during the reporting period.
Reporting boundaries were set to include total of eightsubsidiaries in APG, including Amorepacific, innisfree,and ETUDE. Amorepacific, a major subsidiary, includes
not only domestic business sites (Global headquarters,
R&I Center, HR Development Center, Regional BU, Amore
Beauty Park, Daily Beauty production site and OSULLOC
production site) but also some performances of overseas
subsidiaries. The company reports positive trend data as
well as negative trend data in a transparent and balancedmanner. The assurance team confirm that the material
topics selected through the materiality assessment were
fully reflected to the Report, based on the physical andperiodic reporting boundaries.

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Accuracy, Balance, Clarity, Comparability, Timeliness andVerifiability
The assurance team has sampled data and reviewed
the sustainability performance data of the Company. In
particular, we have reviewed the reliability of the disclosure
data below with reasonable level of assurance;· Water consumption· NOx emission· Equal payment· Accident rate and Fatal accidents
The assurance team has sampled data and tested accuracy
and reliability of the sustainability performance data of theCompany and interviewed the responsible for the subject
data handling and reviewed the data gathering process withthe supporting documents and records. Based on the test, theintentional error or misstatement is not noted. Data owners
were able to demonstrate to trace the origin of the data andto interpret the processed data in a reliable manner. The data
was identifiable and traceable. The Company reports thesustainability performance of the last three years and can becompared over time. Any errors or unclear expressions foundduring the verification process were corrected prior to the
publication of the Report.

Chapter 1

Chapter 2

Chapter 3

Appendix

114

Scope and Approach

Basis of Our Opinion

Responsibilities of the Directors of APG and DNV

We performed our work using DNV’s assurance methodology
VeriSustain™ which is based on our professional experience,
international assurance best practices including theInternational Standard on Assurance Engagements
3000 (“ISAE 3000”), and the Global Reporting Initiative
Sustainability Reporting Standards (“GRI Standards”).

The assurance was carried out from February to June
2022. We undertook the following activities as part of theassurance process:· Site visits to APG headquarter in Seoul, Amore Beauty
Park, and Daily Beauty production site in Daejeon toreview process and system for preparing sustainability
data and implementation of sustainability strategy.

The Directors of APG have sole responsibility for the
preparation of the Report. Our statement represents
our independent opinion and is intended to inform all
stakeholders. DNV was not involved in the preparationof any statements or data included in the Report
except for this Assurance Statement. DNV’s assurance
engagements are based on the assumption that the dataand information provided by the client to us as part of ourreview have been provided in good faith. DNV expressly
disclaims any liability or coresponsibility for any decision aperson or an entity may make based on this Independent
Assurance Statement.

· Conducted interviews with representatives from thevarious departments;

Competence and Independence

We evaluated the Report for adherence to the principles
of sustainability context, completeness. And we used
the principles (Accuracy, Balance, Clarity, Comparability,
Timeliness and Verifiability) stipulated in GRI Standards
2021 as criteria for evaluating performance information,
together with APG’s data protocols for how the data aremeasured, recorded and reported. The engagement excludes
the sustainability management, performance and reporting
practices of APG’s subsidiaries, associated companies,
suppliers, contractors and any third-parties mentioned in
the Report. We did not interview external stakeholders aspart of this assurance engagement. Economic performancebased on the financial data is cross-checked with internal
documents, the audited consolidated financial statements
and the announcement disclosed at the website of Korea
Financial Supervisory Service (http://dart.fss.or.kr) as well as
APG’s website (www.apgroup.com). The review of financial
data taken from these sources is not within the scope of ourwork.
We planned and performed our work to obtain the evidence
we considered necessary to provide a basis for our assurance
opinion. We are providing a ‘limited level’ of assurance.
Limited depth of evidence gathering including inquiry
and analytical procedures and limited sampling at lower
levels in the company were applied. The baseline data forenvironmental and social performance are not verified, while
the aggregated data at the corporate level are used for theverification.

· Challenged the sustainability-related statements andclaims made in the Report and assessed the robustnessof the underlying data management system, information
flow and controls;· Conducted document reviews, data sampling andinterrogation of supporting databases and associatedreporting system as they relate to selected content andperformance data;

DNV’s established policies and procedures are designed
to ensure that DNV, its personnel and, where applicable,
others are subject to independence requirements(including personnel of other entities of DNV) andmaintain independence where required by relevant· Reviewed the process and the result of materiality 아모레퍼시픽 그룹 2020 년 온실가스 배출량
ethical requirements. This engagement work was carried
단위: tCO2-eq
assessment.
out by an independent team of sustainability assurance직접배출에너지간접배출
기타배출아모레퍼시픽 그룹
professionals. This engagement work was carried out총배출량(Scope1)(Scope2)(Scope3)by an independent team of sustainability assurance아모레퍼시픽
9,301
35,702
1,667
46,670professionals.
퍼시픽패키지
코스비전오설록 농장
에스트라

상해사업장

225

3,116

-

3,341

658

2,785

-

3,443

2,416

1,187

603

1,901

703

6,620

July 8, 2022
3,603
Seoul, Korea
2,504
DNV Business Assurance Korea Ltd.
7,323
Jang Sup Lee, Country Representative-※ 상기의 온실가스 배출량은 정수로 보고하기 위한 반올림처리로 인해 시스템의 실제값과 ± 1 tCO2-eq 미만의 차이가 발생할 수 있음.
※ 총 배출량 = 직접배출 + 에너지간접배출 (아모레퍼시픽의 경우, 기타간접배출 포함)

2021 년 3 월 10 일

이장섭

대표이사
DNV Business Assurance Korea

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Verification
Statement
GHG Inventory(Domestic)

Chapter 1

Chapter 2

115

Verification Approach

Amorepacific Group’s GHG Emissions in 20211)

DNV Business Assurance Korea Ltd. (“DNV”) was
commissioned by AMOREPACIFIC Group to verify its
Greenhouse Gas Inventory Report for the calendar year
2021 (“the report”) based upon a limited level of assurance.
AMOREPACIFIC Group is responsible for the preparation of
the GHG emissions data on the basis set out within the WRI/WBCSD GHG protocol: 2004 and 2006 IPCC Guidelines for
National Greenhouse Gas Inventories, and the principles set
out in ISO 14064-1:2018. Our responsibility in performing
this work is to the management of AMOREPACIFIC Group
only and in accordance with terms of reference agreed withthem. DNV expressly disclaims any liability or responsibility
for any decisions, whether investment or otherwise, based
upon this assurance statement.

The verification has been conducted by DNV from 8th
February through 19th April 2022 and performed inaccordance with the verification principles and tasks
outlined in ISO 14064-3:2019. We planned andperformed our work so as to obtain all the informationand explanations deemed necessary to provide us with
sufficient evidence to provide a verification opinion with
5% materiality level, concerning the completeness ofthe emission inventory as well as the reported emission
figures in ton CO2 equivalent. As part of the verification
process;

Category

The emissions data covered by our examination comprise
Direct emissions (Scope 1 emissions), Energy indirectemissions (Scope 2 emissions) and Other indirect emissions(Scope 3 emissions) from following organizationalboundaries:·	AMOREPACIFIC: Head office (Yongsan), Sale offices,
Manufacturing Sites (Beauty 1&3 in Osan, Daejeon,
Ansung, Jincheon), Distribution centers (Gangbuk,Gwangju, Gimcheon, Daejeon, Gimhae, Osan, Incheon,
Jincheon and Songtan), R&I Center/HRD, Local Business
unit (Gwangju, Daegu, Daejwon and Busan), Delivery andtransportation by centers (Other indirect emissions)

In the event of ambiguity or contradiction in this statement between
English version and Korean version, Korean shall be given precedent.

Appendix

Introduction

Scope of AssuranceThis Assurance Statement is valid as of the date of the issuance (19th April
2022). Please note that this Assurance statement would be revised if any
material discrepancy which may impact on the Greenhouse Gas Emissionsof AMOREPACIFIC Group is subsequently brought to our attention.

Chapter 3·	PACIFICPACKAGE: Cheonan(tCO2e)Emissions

Direct Emissions

12,237

Indirect Emissions

44,475

Other Indirect Emissions

9,320

Total (Direct + Indirect emissions)

56,712

Total (Direct + Indirect + Other emissions)

66,032·	We have reviewed and verified the Greenhouse Gas
Amorepacific Group Energy Consumption in 20212) (GJ)
Inventory Report of AMOREPACIFIC Group (including
activity data, GHG emission calculation results, emission
Category
Consumption아모레퍼시픽 그룹 2020 년 온실가스 배출량
factors, and other parameters)
단위: tCO2-eq
Fuel230,283직접배출에너지간접배출
기타배출·	We have reviewed and verified the process to generate,아모레퍼시픽 그룹총배출량(Scope1)(Scope2)(Scope3)
aggregate and report the emissions data
Electric Power932,181Conclusions아모레퍼시픽
퍼시픽패키지

9,301
225

35,702

1,667

3,116

-

Renewable Energy

46,67081,038

3,341

코스비전
3,443
Total 2,785
1,243,502
Based on the above verificationof core elements, it is the 658
오설록
농장
1,187
3,603
DNV’s opinion that nothingcomes
to our attention to 2,416
suggest that GHG emissions
are not properly calculated, 603
에스트라
1,901
2,504
April 19, 2022
and a significant uncertainty
and error are included in the 703
상해사업장
6,620
7,323
Country
Representative,
DNV
Business
Assurance
Korea
GHG Emissions fromdomesticof AMOREPACIFIC※ 상기의온실가스sites배출량은정수로 보고하기 위한 반올림처리로 인해 시스템의 실제값과 ± 1 tCO2-eq 미만의 차이가 발생할 수 있음.
Jang Sup Lee※총배출량= 직접배출 + 에너지간접배출 (아모레퍼시픽의 경우, 기타간접배출 포함)Group for the year2021
below;
2021 년 3 월 10 일

이장섭

대표이사
DNV Business Assurance Korea·	COSVISION: Daejeon·	OSULLOC: Hannam, Premium factory, Seokwang,
Dolsongi, Wolchulsan, and Kwnaghyewon1)	In order to report the GHG emissions as an integer, the value on thestatement might be different from the actual number with ± 1 tCO2-eq.
2)	Renewable Energy: Electricity generated from Hydroelectricity, Solar
photovoltaic power, Wind Power, Bio Energy

CEO Message

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Verification
Statement
GHG Inventory(Shanghai)

Chapter 1

Chapter 2

Appendix

Objective

Verification statement

The purposes of this verification exercise are, by review ofobjective evidence, to independently review:TÜV SÜD has conducted verification on 2022-05-20 2022-05-23 with regard to the GHG assertion of AMORE
Cosmetics (Shanghai) Co.,Ltd. which included assessmentof GHG information system, monitoring and reporting.
This assessment included the collection of evidences
supporting the reported data, and the evaluation of theconsistency and appropriateness of those evidences.

·	Determine the extent of conformity of AMORE
Cosmetics (Shanghai) Co.,Ltd.’s GHG emission inventorywith the applicable verification criteria;·	Assess completeness of the organization’s GHG
inventory of GHG emissions and removals;·	Evaluate organization’s GHG information system and its
controls/management in preparing emission inventory;·	Confirm the GHG assertion is without material
discrepancy, and whether the verification activities
provide the level of assurance agreed to at the beginningof the verification process.

Verification Criteria
The verification was performed on the basis ISO 1406403:2019 Greenhouse gases – Specification with guidance
for the verification and validation of greenhouse gas
statements.

This Statement is issued, on behalf of the client, by TÜV SÜD under its
general conditions for Greenhouse Gas Verification Service Description.
The findings recorded hereon are based upon an audit performed by TÜVSÜD. A full copy of this statement, the findings and the supporting GHG
Assertion may be consulted at the organization. To check the validity of thisstatement please call (+86 21 6141 0182). This Statement does not relieve
client from compliance with any bylaws, federal, national or regional acts
and regulations or with any guidelines issued pursuant to such regulations.
Stipulations to the contrary are not binding on TÜV SÜD and TÜV SÜD shallhave no responsibility vis-à-vis parties other than its client.

Chapter 3

116

Greenhouse Gas Emissions ofAmore Cosmetics (Shanghai) Co., Ltd(tonnes CO2e)

Category

Emissions

Total GHG Emissions

1,610

Scope 1 (Category 1 direct emissions)

1,610

Direct emissions from stationary combustion996

In TÜV SÜD’s opinion, the GHG statement within a period
from 2021-01-01 to 2021-12-31,

Direct emissions from mobile combustion

14·	Is materially correct and fairly representation of the GHG
data and information,

Direct fugitive emissions from the release of
GHG in anthropogenic systems

600·	has been prepared in accordance with the relatedInternational Standard on GHG quantification,
monitoring and reporting, or to relevant national
standards or practices.

Scope 2 (Category 2 indirect emissions
from imported energy)0·	Covered Period: 2021-01-01 to 2021-12-31

Level of Assurance·	Level of Assurance: Limited

At a limited - but not absolute-level of assurance, we
verify that there’s no evidence that the GHG statement
is not materially correct, is not a fair representation of
GHG data and information, has not been prepared inaccordance with related international standard on GHG
quantification, monitoring and reporting or to relevant
national standards or practices.

·	Materiality threshold: 5% of the total GHG emissions·	Verification Report No.: 0302220501
Shanghai, 2022-05-24
ZHANG Cuiyun

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Chapter 1

Chapter 2

Chapter 3

Major Awards
and Recognitions
DJSI Korea Index for 12 consecutive years (Amorepacific)

FTSE4Good Index for 11 consecutive years (Amorepacific)
FTSE4Good Index for 10 consecutive years (Amorepacific Group)

MSCI ESG Rating Class A (Amorepacific)

MSCI ESG Rating Class AA (Amorepacific Group)

Appendix117

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Date of Publication

July 2022

Publisher

Suh Kyung-bae

Publishing Organization

Amorepacific Group

Production

Sustainable Innovation Team, Amorepacific

Design Planning

Creative Strategy Team, AmorepacificConcept ·Design

cement × PLANE AND VERTICAL

Editing

Seo Hana

100, Hangang-daero, Yongsan-gu, Seoul, Republic of Korea
Tel. 02 6040 5114
E-mail. csr@amorepacific.com
www.apgroup.com

Chapter 1

Chapter 2

Chapter 3

Appendix118