A MORE
BEAUTIFULWORLD
2022 Amorepacific Group Sustainability ReportPurpose of the Report

Reporting Period

Amorepacific Group publishes a sustainability report every year
in order to present the results of its sustainability management
activities. Through this report, we aim to transparently
disclose the company’s environmental, social, and governanceachievements to all stakeholders, collect various opinions, andreflect them in our future management activities.

The reporting period is from January 1, 2022 to December
31, 2022. Depending on the importance and timeliness of theinformation, the Report presents some information pertaining
to performances before 2022 or in the first half of 2023, andthis is indicated separately in the Report. For quantitative
performances, some items provide data for the last three years(2020-2022) or four years (2019-2022) to compare the trends
by year.

Reporting Standards
The 2022 Amorepacific Group Sustainability Report was
prepared in accordance with 2021 GRI (Global Reporting
Initiative) Standards and SASB(Sustainability AccountingStandards Board)’s standards for the Household & Personal
Products industry, and financial performance was preparedbased on K-IFRS consolidation unless otherwise stated.

About
This Report

Reporting Assurance
To increase the accuracy and reliability of this Report, thecontent was verified by an external assurance, BSI, a verification
expert agency. The detailed assurance statement is included in
Chapter 5. Appendix.

Reporting Scope

Inquiries on the Report

The scope of financial performance reporting was prepared ona consolidated basis and non-financial performance covers all of
the company’s consolidated subsidiaries (Amorepacific Group,
Amorepacific, Innisfree, ETUDE, Amos Professional, Espoir,
OSULLOC, OSULLOC Farm, COSVISION, WeDream, Green
Partners, and overseas subsidiaries1). In the case of Amorepacific,
the major subsidiary, the reporting covers domestic operations(Headquarters, R&I Center, HR Development Center, Regional
Offices, Amore Beauty Park, Daily Beauty production site,
OSULLOC production site, and Healthcare production site) andsome of its activities from overseas subsidiaries. For detailed
reporting scope by indicator, please refer to the Reporting
Methodology (p.102-105) in Chapter 4. ESG Factbook of thisReport.

If you have any questions about the Report, please email us at1)	See 2022 Amorepacific Group Business Report p.365-366 ‘Current Status of
Subsidiaries Subject to Consolidation’

Sustainable Innovation Team, AmorepacificE-mail: csr@amorepacific.com

03

1

2

3

4

5

04

Chapter 1

Our Company

05

CEO Message

We MakeA MORE
Beautiful World

Dear Valued Stakeholders
Since the foundation in 1945, Amorepacific Group has
led the Korean beauty industry under the mission, “Wemake A MORE beautiful world.” With our unrivaled
sincerity and philosophy of beauty, the Group has been
loved widely by global customers, and has created anddeveloped K-beauty trends worldwide.
Our long-standing sustainability management efforts
were initiated from a sense of responsibility to theworld and our customers who have supported theGroup through the decades. The history started fromthe 1993’s declaration on ‘Total Commitment Initiative’on product quality, service, and the environment, andcontinues to the recent five sustainability management
goals as part of ‘2030 A MORE Beautiful Promise’.
Facing a rapidly changing world in the aftermath ofthe pandemic, last year we focused on promoting
value consumption culture among customers, leading
the industry’s response to climate crisis and resource
circulation, as well as spreading the value of diversity
and inclusion.
Now Amorepacific Group faces another challenge. We
will deep dive into and introduce the concept of futureoriented “New Beauty”, that allows all beings in theworld, including customers, to discover and realize theirown beauty to their heart’s content. In the process, wewill examine the environmental and social impact of ourcorporate activities at close quarters to accelerate theimplementation of the five sustainability management
goals as part of ‘2030 A MORE Beautiful Promise’ which
will actively support the realization of the Ten Principlesof the UN Global Compact (UNGC) and the UN’s 2030
Sustainable Development Goals.
All employees of Amorepacific Group, who haveinherited the founding philosophy of “contributing tohumanity with beauty and health,” will work with aclear sense of purpose to convey benefits to the world.
Sometimes through trial and error, we will join handswith everyone in the corporate ecosystem to find thebest way to create a more beautiful world. I ask for yourcontinued interest and support in this journey.

June 2023
Chairman and CEO of Amorepacific Group06

Corporate
Overview

Company Information
Company Name

Global Network

Amorepacific Group Co., Ltd

Korea

Major Holding Companies and Subsidiaries― Revenues3)

CEO

Suh Kyung-bae, Lee Sang-mok

Head Office Address

100, Hangang-daero, Yongsan-gu,
Seoul (Hangang-ro 2-ga)

Revenues1)

North America

2,784.7
6,145― Number of employees

billion KRW

employees

183.3
156

billion KRW

employees

4,495 billion KRW

Number of Employees1) 10,010 employees
1) Revenues and number of employees as of December 2022

Moscow

Paris

Seoul (HQ)

Sustainability management External
Performance 2)

Shanghai
Delhi

Hong Kong

Bangkok
Kuala Lumpur
Singapore

KCGS

MSCI

(Amorepacific Group, Amorepacific)(Amorepacific Group, Amorepacific)

A

A

DJSI
(Amorepacific)
Listed in the World Index
Listed in the Asia-Pacific Index

2) As of 2022

CDP
Climate Change(Amorepacific)

A

Toronto
New York
Tokyo

Taipei

ManilaHo Chi Minh
Jakarta

Melbourne

Europe and Others

Asia

50.5
61

1,476.5
3,648

billion KRW

employees

billion KRW

employees3) Revenues figures are based on the 2022 consolidated financial statement of Amorepacific Group07

Our Value System

MissionVisionWE MAKEA MOREBEAUTIFUL WORLD

Live YourNew Beauty

The Amorepacific Group has the mission to make a more
beautiful world, and holds a firm belief that the world becomes
more beautiful when each and every person shines with theirown unique beauty. This is why we take this path.

Customers first
We analyze situations and issues from theperspective of our customers and prioritize
customer satisfaction in decision making toensure prompt actions.

Inspires “New Beauty” in every individual customer todiscover, live and enjoy a healthy, fulfilling life.
New Beauty inspired by life
Transcending the meaning of beauty in the narrow sense,
Amorepacific expands the realm of beauty to the entire lifecycleof customers and their daily lives. We deliver Wellness care forhealthy and balanced inner & outer beauty and provide nextgeneration beauty products with enhanced efficacy.

New Beauty created with Digital
By leveraging digital technologies and customer data, we
provide hyper-personalized solutions, including customized
cosmetics, across all touchpoints. We deliver the optimal
customer experience by building a closely knitted channel ofcommunication with our customers.

Embracing the founding philosophy of “contributing tohumanity with beauty and health,” Amorepacific Groupis taking steps in the journey of beauty as “We makeA MORE beautiful world”. Each brand, distribution
channel and country plays different roles in the Group,
but through sharing the “mission”-our reason of being,
the “vision”-our direction forward, and “ABC spirits”our way of working, we hope to keep our promises
with the world.

ABC Spirit

New Beauty resonating with Empathy
Amorepacific respects the beliefs of individuals, diversity, andhave a deep love for our planet. With strong compassion forhumanity, we take care of and resonate with the entire corporate
ecosystem. We communicate with key stakeholders and bringlight to the beautiful values of coexisting and moving forward
together.

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

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

Respect differences
We respect differences, discover strengths indiversity, and act politely with one another.

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

08

Brand Portfolio

09

Building a World of Beauty, Powered by Art and Heritage

Feel The Glow

Effective, Nature-Powered Skincare Discovered from the Island

Sulwhasoo is the innovative artist in the field of beauty creating a work of art thattranscends time and generations

Radiance on my skin, Confidence in my life

Innisfree, a high-efficiency naturalist brand that explores the infinite energy
from nature to deliver healthy beautywww.sulwhasoo.com

www.laneige.com

www.innisfree.com

10

The Artisanship of Beauty
www.amorepacific.com

Contemporary Seoul beauty brand that defines and creates thelatest vision of beauty

All about skin barrier by SEED TECH™

A skin bio-science based, highly functional skincare brand

www.primerabeauty.com

www.iope.com

A derma cosmetic brand that offers real skin concern-specificspecialized solutions based on skin specialized research for
medicines, medical devices, and cosmetics

Espoir, a makeup creation brand that inspires you to find yourown look

www.hera.com

Make it simple and clear, the most beautiful thing that’s like me

Balanced beauty delivered through the benefits of Korea

www.mamonde.com

www.hanyul.com

www.aestura.com

www.espoir.com

11

MAKE YOUR PLAYLISTRoot Your Own beauty

A total hair cosmetics brand that leads the hair and style trend

www.etude.com

www.ryo.com

www.miseenscene.com

Based on Amorepacific’s skincare know-how, the Scalp
Skincare Research Institute takes care of scalp problems andrestores health.
www.laboh.co.kr

AMOS Professional, a professional solution brand that serves
as the standard for salon workwww.amosprofessional.com

A gentle, yet effective solution for sensitive skin, ILLIYOON
www.illiyoon.com

Daily body care brand with healthy ingredients and scents that
add happiness to everyday life
www.happybath.com

Customized optimal dental solution

12

Scents of your life

The beginning of healthy beauty

Meaningful relaxation delivered by tea from Jeju

www.goutalparis.com

www.vitalbeautie.com

www.osulloc.com

Friendly but with a unique taste, free and sensible, but not too
much. A total styling brand for men who want to freely express
their individuality

Holistic Ritual for Skin Wellness

www.brdy-official.com

www.holitual.com

Life-beauty device that promises better skin with new habits

13

Key Business
Performance

The Amorepacific Group is engaged in diverse brandoriented business activities. In 2022, we strengthened
our position in the domestic and global markets
through various sales activities such as strengthening
luxury brands, expanding the e-commerce channels,
launching customized products for Millennials and
Gen Z(MZ) customers, and launching collaborative
products.

Domestic Cosmetics Business

Domestic Daily Beauty BusinessAmorepacific has strengthened its brandcompetitiveness and position through renewal ofmajor products and activities to enhance brandvalue. Sulwhasoo strengthened brand attractivenessby executing a rebranding campaign, while Primera
enhanced brand competitiveness by restructuring
its brand and launching a new functional line “AG.
VCNTM.” Laneige released nine products in “Water
Bank Blue Hyaluronic” line, with innovative designs,
and IOPE nurtured the functional category byreleasing “PDRN Caffeine Shot” ampoule products.
Hanyul strengthened customer responsiveness bylaunching its first renewed edition of its steadyselling product “Yuja Vita-C Sleeping Mask”.

Amorepacific focused on increasing sales mix ofhigh margin products by launching new brand andnurturing premium product categories. Mise-enscène enhanced brand attractiveness by expanding
the product line up in the “Salon 10” category.
Premium lifestyle brand, Longtake has seen strong
sales in the market since its launch, while HAPPYBATH drove sales growth for its high-moisturizing
line “Skin U” containing hyaluronic acid andpanthenol.

We also focused on the inner beauty category basedon our innovative products and fostered future
growth categories such as personalized cosmetics
and men’s makeup. Vital Beautie diversified its “Super
Collagen” lineup and won “2022 Monde Selection”
and “Korea’s Green Product of the Year,” proving
its superior product competitiveness. Laneige
launched “Bespoke Neo,” a personalized cushion andfoundation manufacturing service, and Be Readylaunched a renewed edition of “Blue Cushion” andexecuted a brand campaign to lay the foundations forthe growth in new categories.

We also made efforts to increase the sales ofmulti-brand shop channels by strengthening ourmarketing campaigns targeting the MZ customers.
LABO-H strengthened its position in the category byconducting marketing campaigns centered aroundthe keywords “Young Hair Loss,” “Clean,” and “ESG”.
ILLIYOON enhanced the customer brand experienceby hosting a pop-up event “Hotel Sensitive” inconnection with the multi-brand shop channels.

Sulwhasoo “First Care Activating Serum Limited Edition”

Mise-en-scène “Salon 10”

14Overseas Business

Performance of Key Subsidiaries

In China, the sales mix of key products by brand,such as “Sulwhasoo Concentrated Ginseng RenewingLine” and “Innisfree Retinol Cica Repair Ampoule”
has expanded due to strengthened marketing.
Furthermore, we reinforced the foundations for
future qualitative growth by reorganizing products
and channels of major brands. In other Asian regions,revenue increased with solid growth in ASEAN
countries. Major brands such as Sulwhasoo, Laneige,
and Innisfree have grown significantly in the ASEAN
market, and in Japan, we have diversified our sales
network with brand launches, including Laneige
entering new retail channels.
In North America, the strong performance of major
brands such as Laneige, Sulwhasoo, and Innisfree
contributed to a significant year-on-year increase inrevenue. We have secured growth momentum byincreasing brand presence in growth channel suchas Amazon and Sephora, and reinforcing marketing
activities. We also secured a clean beauty portfolio
through the acquisition of the “Tata Harper” brand,laying the foundations for the competitiveness of our
mid- to long-term North American business.
In the European region, Laneige drove growth, withoverall revenue significantly increased year-onyear. Laneige posted solid sales growth in online
and multi-brand shop channels. Goutal laid thefoundations for growth through brand renewal basedon its heritage.

InnisfreeInnisfree’s revenue in online increased strengthening brand competitiveness and enhancing
sustainability leadership, with the focus on key functional products such as “Black Tea
Youth Enhancing Ampoule,” “Retinol Cica Repair Ampoule,” and “Collagen Peptide Firming
Ampoule Cream”.

ETUDE
ETUDE launched its flagship eyeshadow palette, Play Color Eyes “Nudifull Espresso,”
and its multi-brand shop and online sales grew due to strong performance of influencercollaborative products.

AMOS Professional
AMOS Professional’s revenue grew by expanding its hair treatment product portfolioand strengthening educational content for designers. Ayunche enhanced awarenessby expanding new salons operated by MZ designers and offering diversified customer
experiences such as hair dye and perm seminars.

EspoirRenewal Launch of the Laneige Water Bank Line (Global)

Espoir’s sales in key category increased by strengthening its glow and matte face makeup
product lines with the launch of “Be Glow New Class” and the performance of the “BeGlow” line.

OSULLOCOSULLOC’s revenue and operating profit increased based on the strong sales of premium tea
sets. OSULLOC reinforced its brand attractiveness with strengthened customer experience by
providing ‘Tea class’ and ‘Tea Cocktail’ in Tea House and a flagship store in Bukchon.

15

Chapter 2

Our Approach to
Sustainability

16

Sustainability
Management
Implementation
SystemSustainability Management Governance
Amorepacific Group and Amorepacific have established a system to effectively
implement sustainability management and are operating the ESG Committee
under the Board of Directors as the top decision-making body. The ESG Committee
manages and oversees ESG risks associated with the company, including issues
related to climate change, resource circulation, supply chain sustainability, local
community co-prosperity, consumer rights and interests, and ethical management.
Furthermore, the committee establishes sustainability management strategies for theGroup and regularly monitors related performances. In 2022, each ESG committee
for Amorepacific Group and Amorepacific gathered for four sessions, where theCommittee reported on sustainability management-related issues. It included
measures to strengthen ESG governance, performance review and implementationplans for the 2030 sustainability management strategy, execution plans for brand
ESG activities, achievement status and plans towards RE100, and introduction of ESG
performance as a part of executive performance assessment criteria1).
The Sustainability Committee is a top executive consultative body where the CEO
and top executives regularly hold meetings to discuss sustainability management
issues and monitor progresses on core tasks. In 2022, a total of two Sustainability
Committee meetings were held, and reporting and discussions were conducted on the2030 sustainability management strategy performance review and implementation
plan as well as the stakeholder engagement program.

Amorepacific Group and Amorepacific haveestablished a transparent sustainability management
implementation system by instituting the ESG
Committee within the Board of Directors and theSustainability Committee under the CEO. Throughresponsible management centered on the top decisionmaking body, we have established sustainability
management strategies and directions for the Groupand the subsidiaries. We are continuously monitoring
the implementation performances.

Sustainability Management Division serves as a coordinator for the implementationof sustainability management. It identifies specific sustainability management
strategy tasks and transparently communicates the company’s sustainability
management performances with external stakeholders through the publication ofsustainability reports. In the case of sustainability management strategy tasks, close
cooperation between various departments is particularly essential, and therefore theimplementation of the tasks is facilitated through working groups.
1)	Reported comprehensive evaluation results needed for publishing the 2022 sustainability report to the Board in the first halfof 2023

Sustainability Management Organization Chart
Board of Directors
ESG Committee· Top decision-making body for sustainability
management· Participation of executive/independent
directors

CEO· Deliberation and decision on the direction and
key activities of the sustainable management
strategy· Supervision and performance monitoring ofsustainability management risks

Sustainability Committee
Sustainable Management Division· Coordination of sustainability management· Establishment of the Group’s sustainability
strategies and identification of relevant tasks

Working Group on Sustainability
Management· Working group for implementing sustainability
management tasks· Operates working groups on issues including
sustainable packaging materials and raw
material sourcing, brands, SHE, mutual
growth, etc.

· Participation of top managements and CEO· Decision making of sustainability strategies
and major activities; monitors performances

172030 A MORE
Beautiful Promise

Strategies to Drive Sustainability Management in Amorepacific

A MORE Beautiful Promise
Two Pillars

Move Forward Together with Customers and Society

Five Promises

2030 Goals

Amorepacific has declared its sustainability
management goal under the title "2030 A MORE
Beautiful Promise," to fulfill its calling to make people
and the world beautiful. Based on two pillars, "MoveForward Together with Customers and Society," and“Coexist Responsibly with Nature," we will contributeto the creation of a sustainable society by fulfilling our
five promises.

Coexist Responsibly with Nature

Promise 1

Promise 2

Promise 3

Promise 4

Promise 5	Instill the values of environmental
and social friendliness into
100% of our new products andpursue endeavors that encouragesustainable living.

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

	Achieve carbon neutrality andzero-waste-to-landfill across our
production sites worldwide.

	Reduce the use of plastics in productpackaging and create 100%
reusable, recyclable or compostable
plastic packaging materials.

	Invest KRW 10 billion into theconservation and sustainable use of
biodiversity and increase the use of
RSPO-certified palm oil to 90% or moreby 2023.

·	Instill the values of environmental
and social friendliness into 100% of
our new products.

·	Operate education and awareness
improvement programs on diversity& inclusion for all employees.

·	Achieve carbon neutrality in global
production sites.

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

·	Conduct life cycle assessments to
help reduce the environmental
footprint of all our new products.

·	Invest KRW 100 billion to support
the financial independence of sociallyvulnerable groups and promote thehealthy lives of citizens.

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

·	Seek technological innovations inGreen Chemistry.
·	Conduct brand campaigns that
promote responsible consumption.

1) Sustainable palm oil certification group established to prevent environmental destruction from palm oil production·	Use 100% renewable energy at all our
production sites globally.
·	Use recycled or bio-based plastics
for 30% of all plastic packaging.
·	Convert all distribution vehicles usedin South Korea into eco-friendly
vehicles.
·	Achieve zero-waste-to-landfill at
global production sites.

·	Increase the use of RSPORoundtable on
Sustainable Palm Oil 1) certified palm oil
to 90% or more by 2023.

182022 Progress ‐ Move Forward Together with Customers and Society
5 Promises

2030 Goals

2022 Key Achievements

Promise 1·	Instill the values of environmental
and social friendliness into 100% of
our new products· 90.5% of the new products launched in 2022 have environmentally·socially friendly attributes

Instill the values of environmental
and social friendliness into
100% of our new products andpursue endeavors that encouragesustainable living.

·	The proportion of new products using recycled and bio-based plastics more than doubled compared to 2021
·	The proportion of new products that reflect value-based consumption trends, such as vegan-certified products, has
increased more than sevenfold compared to 2021

·	Conduct life cycle assessments to help · Built the foundation for environmental foot printing and scoring methodology
reduce the environmental footprint of ·	Developed the primary model for measuring cosmetic product environmental footprint based on the EU Productall our new products
Environment Footprint

Achievement rate compared to the 2030 targets

90.5 %

100%

1.4%

100%

4cases16cases

11.6%

100%

KRW

KRW

·	L ANEIGE Water Bank Blue Hyaluronic line received Water Footprint reduction certification from UK Carbon Trust·	Seek technological innovations inGreen Chemistry·	Developed various innovative technologies, such as surfactant-free collision emulsification, materialization of white
ginseng power waste residue, and photo-mediated protein cross-linkage·	Conducted brand campaigns that
promote responsible consumption·	Carried out #SaveTHEWATER Challenge, where consumers uploaded their daily life water conservation activities on theirsocial media, and formed a consensus with the customers on practicing eco-friendly lifestyle·	Implemented regular coastal clean-up projects through a partnership with WWFWorld Wildlife Fund Korea to adopt
Cheongpodae Beach in Taean Coastal National Park

Promise 2
Promote diversity and inclusion
across all our global workplaces
and beyond, while seeking
harmonious growth with all our
stakeholders.

·	Operate education and awareness
improvement programs on diversity& inclusion for all employees· 11.6% of all employees have completed diversity & inclusion education and awareness improvement programs·	Invest KRW 70 billion to support thefinancial independence of sociallyvulnerable groups· Invested KRW 7.9 billion to support financial independence (Cumulative total of KRW 11.13 billion)·	Invest KRW 30 billion to promotehealthy lives and cultural initiatives
among citizens·	Invested KRW 770 million to promote the citizens’ healthy living and cultural dissemination (Cumulative total of KRW 3.8
billion)· Provided diversity workshops and training sessions, newsletters, and sensitivity tests, etc.

·	Provided technical education to strengthen employment capabilities, operated Hope Store, project for providing financial
support (loan) to single mothers to achieve financial independence, and expanded the scale of strategic product donation,etc.

·	Hosted “makeup your Life”, a beauty therapy program targeting cancer patients, a new form of “2022 Pink Festival” thatincorporated a fitness program, and discovered innovative business ideas through ‘A MORE Beautiful Challenge’

11.13billion
KRW

3.8 billion

70 billion
KRW

30 billion

192022 Progress ‐ Coexist Responsibly with Nature
5 Promises

2030 Goals

2022 Key Achievements

Promise 3·	Achieve carbon neutrality in global
production sites· Shanghai production plant reached carbon neutrality (2021-2022)

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

Achievement rate compared to the 2030 targets

20.0%

100%

·	Use 100% renewable energy at all our ·	Converted 34.1% of AMOREPACIFIC’s electricity consumption to renewable energy through the introduction of solar selfproduction sites globally
generation, PPA contracts, green premium plans and purchase of renewable energy certificates

34.1%

100%

·	Convert all distribution vehicles used in · Converted eight electric vehicles in Incheon Logistics Center
South Korea into eco-friendly vehicles

7.9%

100%

100%

100%

47.1%

100%

7.2%

30%

KRW

KRW

·	Achieve zero-waste-to-landfill at
global production sites·	Reached zero landfill disposal of waste at global production sites·	Amore Beauty Park obtained UL Solutions’ Silver designation for Zero Waste Classification, for the first time in the cosmetics
industry (Landfill waste diversion rate of more than 94%)·	Daily Beauty Plant and COSVISION Plant acquired UL Solutions’ Platinum designation for Zero Waste Classification (Landfill
waste diversion rate of 100%, Highest Rating) in the first half of 2023

Promise 4·	Design all plastic packaging materials ·	The evaluation results on the ease of recycling of packaging materials demonstrated that 47.1%1) of plastic packaging
to be 100% recyclable, reusable, ormaterials obtained grades above “normal”
compostable.

Reduce the use of plastics inproduct packaging and create 100%
·	Use recycled or bio-based plastics for ·	7.2% of total plastic used consisted of recycled or bio-based plastic1)
reusable, recyclable or compostable 30% of all plastic packaging(830.5 tons of recycled plastic and 81.9 tons of bio-based plastic within a total of 12,644 tons of plastic used)plastic packaging materials.

Promise 5·	Invest KRW 10 billion into biodiversity · Invested KRW 2.32 billion to preserve biodiversity and secure their sustainable use
conservation efforts and climate·	Carried out a joint study with National Institute of Biological Resources and National Baekdudaegan National Arboretum
change adaptation technologies.
to discover the hidden values of indigenous plant resources on the Korean Peninsula

Invest KRW 10 billion into theconservation and sustainable useof biodiversity and increase the useof RSPO-certified palm oil to 90%·	Increase the use of RSPO-certified
or more by 2023.
palm oil to 90% or more by 2023.

1) Aggregated data based on the Extended Producer Responsibility (EPR) for 2022

·	Development of new varieties (rose, centella asiatica) to contribute to the expansion of plant genetic resource diversity
and to provide excellent effective raw materials to customers

2.32 billion· Out of the total 20,145 tons of palm-derived ingredients used in 2022, 53.6% was RSPO-certified palm oil

10billion
2023 Goals

53.6%

90%

20

Stakeholder
Engagement

Stakeholders

Communication Channels

Frequency

Key Issues

Key Response Activities

Customers

Corporate website, Brand website

On demand

Corporate contents platform – News Square

On demand· Accurate and rapid delivery of corporate
information

Social media channels (YouTube, Facebook, Instagram, etc.)

On demand

Amore Mall, ARITAUM MallOn demand· Advancement of corporate communication
platform operations (reorganization of News
Square and corporate social media channel
contents, expansion of MZ customer targeted
contents)

Customer service centers of each brandOn demand

Employee engagement survey

Once a year (regular), once or twice a year (-ad hoc)

· Disseminating a culture of trust and respect· Diversifying in-house communication programs

Labor-Management Council, Labor Union

Once per quarter

Management town hall meetings

On demand· Enhancing the propagation and communicationof corporate value

All employee session – Team Amore Conference

Once a year (regular)· Forming harmonious labor-management
relations· Conducting management town hall meetings(incorporating organizational development
programs and in-house communication
programs)

In-house online broadcasting - Amore Blooming

Once a month· Creating a healthy and ethical work environment

In-house content platform - AP members

On demand

Business communication platform – Workplace

On demand

Ethics Hotline

On demand

Annual General Shareholders’ Meeting

Once a year

· Building appropriate corporate values· Quarterly and annual earnings release

Quarterly earnings release conference calls

Once per quarter· Enhancing shareholder values· Sharing mid- to long-term business strategies

Domestic/overseas investor conferences and NDRNon Deal Roadshow

Two or three times per quarter

Investor/Analyst Day

Once a year

Business reports

Once a year

Face-to-face meetings and conference calls for investors

On demand

IR website and IR official email accountOn demand

e-Disclosure system

On demand

Local consultative meetings

On demand

BOD meetings of foundations

Once a year

CSR portal site

On demand

Yongsan Dragons activities

Once per quarter

Seminar on door-to-door sales business practices

Once a year

Aritaum business practice seminars

Once a year

Innovation committee

Semi-annual

Dialogues with stakeholders

On demand· Responding to changes in government policies

Collaboration and support

On demand· Participating in achieving 2030 AMBP

Korea Cosmetic Association member company

On demand

Employees

Shareholders/investors

Local communities

Amorepacific Group defines customers, employees,
shareholders/investors, local communities, business
partners, and relevant institutions and associations
as its six stakeholders, and operates communication
channels tailored to each stakeholder’s characteristics
at all times. Through transparent communication,
the major issues and needs of each stakeholder are
identified and reflected in management activities, anda consensus on sustainability management is formed.

Business partners

Relevant institutions
and associations· Safe product usage and accurate productinformation delivery· Resolving VOCs

· Presenting market trends and outlook· Mutual growth with local communities· Implementing community-based problemsolving initiatives (employee volunteer activities
related to community issues, revitalization of
traditional markets, operation of youth mental
health care programs, etc.)· Strengthening and supporting thecompetitiveness of business partners· Establishing a participatory strategy for store
managers· Strengthening communication at all times· Participating in decision-making processes
related to government policies· Joining associations and declaring support forimportant initiatives (including UNGC)

21

Materiality Analysis

Materiality Assessment Process
The 2022 Sustainability Report contains material topics derived, based on
the prioritizing principle of GRIGlobal Reporting Initiative, an international standard forsustainability reporting. Among the various impacts of Amorepacific Group’s businessactivities on the external environment, including the economy, environment, andsociety, specific high-impact issues were selected as material topics, and a three-stepprocess was introduced to evaluate the level of impact in depth.
Amorepacific Group

Step 1

Step 2

Step 3

ESG Issues Derivation

Impact Identification

Impact Assessment

Derive ESG issues associated with the business· List issues related to sustainability management

Amorepacific Group conducts an annual materiality
assessment to identify issues that require prioritizedresponses among various ESG issues related toour business. The identified material topics fromthe assessment are reported as key issues in thesustainability report and related response activities
and performances are transparently disclosed to
stakeholders.

Evaluation of the level of impact
the corporate has on the external
environment

· 	Reflect global sustainability reporting standards(GRI,
SASB, etc.), and evaluation criteria (MSCI, DJSI, etc.) that
include cosmetic industry-specific issues, and the focus
areas of Amorepacific 2030 A MORE Beautiful Promise· Derive a total of 11 ESG issues

Economy·Environment·Society

Identify the impact of Amorepacific Group’s

Assess each level of impact and select material

activities on the environment and society

topic· 	Identify the positive·negative, or actual·potential impactsof Amorepacific Group’s activities related to the issues,on the environment and society· 	Assessment conducted by internal ESG personnel andexternal ESG experts· 	Basis for identification		- Policy and regulatory status, industrial status,
stakeholders’ opinions, investors’ suggestions,board of directors’ agenda· Identify a total of 17 impact areas· Evaluation criteria		- Scale, scope, calibration potential (for negative
impact assessment), occurrence potential (forpotential impact assessment)

22

Materiality Assessment Results

ct
u
d
ro
p
le

Haza
rdou
s ch
em
ica
ls

Material Topic 2

ers
m
sto
u
C

Emp
loy
ee

Impact on the External
Environment

Impact Level ofType Impact

Environmental
Impact of
Packaging
Materials· Cutting down on carbon emissions by reducing the use of plastic packaging materials and converting to recycled·biomaterials

Positive· Improving the domestic waste recycling rate by enhancing the product packages’ ease of recycling and developing
reusable containers

Positive

Sustainable
Products andServices·D isseminating sustainable lifestyles among consumers by providing products that reflect environment and social values

Positive· Improving the product environmental impact through the use of sustainable resources and measuring the carbon
emissions and water usage of product’s entire lifecycle

Positive

Energy Usage·R eduction of carbon emissions through the increased use of renewable energy

Positive●●●

Hazardous
Chemicals· Increasing consumers’ sense of security and protecting the environment by reducing substances of high-concern whendeveloping products

Positive●●○

Industrial
Safety· Ensuring a safe working environment through accident and disaster prevention measures

Positive●●○· Increasing accident rates due to the failure to reinforce safety culture within the local community where the business islocatedNegative· Minimizing environmental impacts by reducing carbon emissions across the supply chain

Positive· Increasing the burden on suppliers with the strengthened of demands for their carbon emission reduction

Negative· Empowering ESG capabilities within the supply chain

Positive· Increasing environmental and social impacts due to the negligence of supplier ESG management

Negative

Waste Recycling· Establishing a circular economy through waste recycling and achieving zero-waste-to-landfill

Positive●●○

Anti-Corruption· Creating an unethical trading order and undermining shareholder values

Negative●○○· Promoting shareholders’ trust by securing the expertise of the board

Positive●○○· Decreasing social utility, due to prioritization of opinions from a minority of stakeholders, as a result of failing to ensure

Negative

●●●

●●●

ern
an

t
ni
u
Comm

Supply chain
greenhouse gas

Supplier ESG

●●○

●●○

y

P

G ov

ar

Waste recycling

Amorepacific Group’s

Shareholders/investors

itutions
Inst ciat andasso ions

Material Topic 1

s
e ga
ous
enh
gre
ain
ch
ply
up

Envir
onm
en
tal

tion
rrup
Anti-co tion
prevenMajor Impact

S

s

tn e

rs

ce

W
ate
ru
sag
e

Environmenta
l impa
ct of

ser
d
n
sa

usage
Energyes
vic

Material Topic 3

pack
agin
gm
ate
ria
ls

Su
sta
ina
b

As a result of the analysis, from the total of 11 ESG issues, three of the most influential (environmental impact of
packaging materials, sustainable products and services, and energy usage) were selected as material topics.1)

TopicsSocialPreventionnga
Or tioera ofop

Organization andiz
n o atio
dir f t n an
ec he b d
tors oardOperation of theBoard of Directors

Supplier ESG

ety
f
a
s
rial
t
s
u
Ind

Water Usageboard diversity· Escalation of water stress and exacerbation of water scarcity in the local community

Negative●○○1)	Compared to the previous year, “energy usage” has been added as a material topic, and “developing eco-friendly products and services” has been expanded to “sustainableproducts and services”. In addition, “waste management and circulation economy” has been incorporated into the “environmental impact of packaging materials”.

Material Topic ●●● High ●●○ Medium ●○○ Low

23

Material Topic Management
Amorepacific Group has established a management system
to reduce the environmental and social impact of company’s
activities related to material topics. We have strengthened
the management of material topics through continuous
monitoring, and transparently communicated the performanceoutcomes the stakeholders.

Definition of the Top Three Material Topics of 2022

Material Topic Management Scheme 1)

1

Governance2

3

Environmental impact of packaging materials
Amorepacific Group is engaged in activities to improve
resource circulation by reducing the environmental
impact of packaging materials through lightweighting,utilizing recyclable·bio based materials, andenhancing recyclability, as well as by reducing waste
disposal during the production and usage stages ofAmorepacific Group’s products

Sustainable products and services
Amorepacific Group is actively contributing to thepromotion of sustainable production and consumption
by supplying products and services that have minimal
environmental impact. This includes products
produced with sustainably sourced raw materials,
vegan products, and products that have obtainedcarbon and water footprint certifications

Energy Usage
Amorepacific Group regularly measures and monitors
energy consumption at its headquarters and production
facilities. It establishes management goals such asenergy consumption reduction target and increased useof renewable energy, and closely monitors the progress
and performance of these goals

Material topic

Related business scopeBusiness Products andoperation
services

Environmental impactof packaging materials●

Sustainable products
and services●

Energy usage●●

Area of impact

Supplychain●

Environmental
Environmental
and Social●

Environmental

Under the environmental management promotion system,
material topics are managed as key agendas. The Board of
Directors, the top decision-making body, oversees related
goals and implementation results. The Group reports relevant
performances and plans to the Board of Directors annually,in accordance with environmental safety regulations, andthe Board makes final decisions. In particular, the Plastic
Committee and Carbon Neutrality Committee convene morethan twice a year to discuss specific issues related to plastic,
resource circulation and energy usage. In addition, the ESG
Committee under the Board regularly sets the overall strategic
directions for environmental management, including material
topics, and deliberates and decides on key activities.
The CEO, who has a responsibility of the overall environmental
management of the company, sets management goals for thethree material topics, and manages and supervises activities
to implement them. Sustainability Committee, also led by
the CEO, establishes relevant strategies and periodicallymonitors the progress on the implementation of the strategy.
Specifically, the financial impact on Amorepacific Group,of regulations and policies related to packaging materials,
products and services, and energy usage are assessed, andincorporated into the overall management strategy.
Specific strategic tasks related to material topics are identified
by teams under Sustainability Management Division, and theidentified tasks are implemented by dedicated environmental
operations organizations in each subsidiary of the Group.
In particular, working groups for each agenda, such assustainable packaging materials and raw material sourcing,support the implementation of strategic tasks. Additionally,
the Environment/Energy Subcommittee, composed ofcompany-wide environmental and energy representatives, monitors
key performance indicators related to energy usage at each businesssites and identifies additional challenges for improvement.

Board of Directors
ESG CommitteeCEO· Coordinates company-wide
environmental management· Sets goals regarding the threematerial topics, reviews environmental
management performances, and· Oversees environmental management
goals and implementation results,
including the three material topics· Establishes the direction of environmental
management strategies and deliberates
and makes decisions on major activities

manages·supervises activities

Sustainability Committee
Sustainability Management
Division· Establishes environmental management
strategies and identifies tasks, related tothe three material topics· Establishes the environmental
management strategy· Monitors the performance of key
environmental management activities· Operates each Plastics Committee andthe Carbon Neutral Committee twice a
year

Team under the division· Establishes detailed strategic tasks
for each subsidiary of the Group
regarding the three material topics ofenvironmental management· Implements strategic tasks andmonitors key performance indicators
1)	The material topic management framework is based on the framework of the
Sustainability Disclosure Standards S1 (General Requirements for the Disclosure of
Sustainability-Related Financial Information) Draft of the International Sustainability
Standards Board (ISSB) under the IFRS Foundation

24

Strategy 1
Environmental impact of
packaging materials

Related 2030 A MORE Beautiful Promise

Detailed Strategies

Promise 4

Operating the 4R (Reduce, Recycle, Reuse, Return) Strategy

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

Amorepacific Group has established a 4R strategy for packaging
materials to reduce unnecessary use of plastic, improve recyclability,
and recycle and reclaim containers, to build a plastic circular economy
model.

Based on the 4R strategy, we will encourage the use of reusable orrecyclable packaging materials through various program operations
to gradually reduce virgin plastic packaging. We will also continue
to invest resources in research and development of environmentallyfriendly packaging materials. To improve the efficiency of managing raw
materials for plastic packages, we have established a detailed KPI for
related objectives at the brand level and we plan on actively managing
the environmental impact of the packaging materials.

Strategy Implementation Status

REDUCERECYCLE

REUSE

RETURN

Reduce the Use of Virgin Plastics

Improve Packaging Recyclability

Expand the Reuse of Plastic Packages

Active Collection of Cosmetic Empties through
GREENCYCLE

In 2022, Amorepacific reduced the use of virgin plastic by 1,080 tons,
through efforts such as the expanded use of recycled plastic and packaging
lightweighting.

Mamonde launched a limited edition Rosewater Toner-Clean
Version, with “excellent” grade for recyclability, categorized by the
Ministry of Environment. The Rosewater Toner Clean Version isbottled in an easily recyclable colorless container, and has an easypeel, water-separable label1) to improve recyclability.

Innisfree Collagen Peptide Firming Ampoule Cream is a
refillable cream, which enables the outer glass jar to bereused as the inner container is replaced with its refill afteruse. In addition, refill product is composed of 97% recycledplastic and the outer glass jar is made with 60% recycled glass
instead of plastic, further reducing the use of plastic.

Amorepacific Group is conducting GREENCYCLE campaign to collect andrecycle empty cosmetic plastic bottles. Approximately 120 tons of empty
bottles were collected in 2022, and a cumulative total of 2,473 tons ofempty bottles have been collected since 2009. Especially, the brand Innisfree
conducted “Empties Frequency Season 2” campaign in August 2022 to collectand recycle empty bottles. When customers return the empty cosmetic bottles
to the store, they received stickers, and depending on the number of stickers
accumulated, they were rewarded with additional Beauty Points and products
made with 50% recycled plastic from empty bottles. Innisfree collected 68
tons of empty bottles in 2022 through its active packaging collecting program.
From 2011 to 2022, Innisfree recycled a cumulative total of approximately
1,174 tons of plastic and glass and thereby reduced greenhouse gas emission
by about 1,507 tons.

LABO’H launched a paper-type refill pouch that can berecycled at on-site separation recycling program. Notably, thepaper material used for the product is recyclable, and refill
product(daughter pack) has the effect of reducing plastic usage
by 90% compared to the refillable product(mother pack).
Additionally, they launched a ‘hair-loss relieving functional solid
shampoo bar,’ also reducing the use of plastic packaging.

Hera Skin Radiant Glow Cushion is the first cushion product in Amorepacific touse 50% recycled plastic in the product packaging(excluding refill container),and bio-based plastic in the puff applicator.

Innisfree Blueberry Rebalancing Skin has been relaunchedafter being renewed with a new package graded “excellent”
for recyclability, according to the categories set by the Ministryof Environment. For improved recyclability, easy peel, waterseparable label has been used, so that it can be removed from thebottle easily without leaving any sticky residue behind.

1)	Label with adhesive that dissolves well in water and separates easily during theprocess of washing the PET for recycling

HANYUL Yuja Sleeping Mask utilizes lightweight glass container with enhanced
reusability. After the customer uses up the mask content, a refill capsule can beinserted and the external jar may be reused again.

25

Strategy 2
Sustainable Products and Services

Related 2030 A MORE
Beautiful Promise

Detailed Strategies

Promise 1

Reducing Environmental Impact Expanding the Use of Sustainably Sourced Raw Materials
throughout the Product Lifecycle We are purchasing raw materials with the objectives of expanding theInstill the values ofenvironmental and social
friendliness into 100% of our
new products and pursue
endeavors that encouragesustainable living.

Amorepacific Group aims to reduce
environmental impacts, such ascarbon emissions and water usage,
generated in its entire product lifecycle- from raw material sourcing, toproduction, transportation, use, anddisposal of the product. Based on thedata measured, we will improve our
products in a manner that reduces ourenvironmental impact.

use of environmentally friendly raw materials and contributing to local
community development. In particular, we are prioritizing our efforts in using
sustainable palm oil in our products to minimize the negative impacts such asenvironmental pollutions and human rights violations that may occur in the
production process of palm oil, one of the main raw materials for cosmetics.
In addition, we prohibit deforestation, and recommend to make joint efforts
in preventing deforestation and respecting the rights of indigenous people inthe sustainability guidelines for supplier. Furthermore, through our Beautiful
Purchases Agreement, we use eco-friendly raw materials grown by local
farmers to help customers select our products with confidence.

Expanding Vegan Products that Exclude the Use of AnimalDerived Raw Materials and Animal Testing
We aspire to practice the value of animal protection by expanding
our range of vegan products that exclude the use of animal-derived
raw materials and animal testing. In particular, we have obtained
vegan product certifications from trusted third-party organizations
in South Korea and abroad, to help customers choose products morereliably. Also, we established an internal policy to ban the use of
brushes made of natural animal hair and stopped all new production
and orders for such products. This policy, which aims to reduce thepain and abuse of animals caused by the development of productsthat utilize natural animal hair, has been applied to all our products.

Strategy Implementation Status
Reduce Environmental Impact throughout the Production
Lifecycle

Expand the Use of Sustainably Sourced Raw Materials

Expand Vegan Products

LANEIGE has actively reduced water usage and carbon emissions throughout its product lifecycle,
as verified by water footprint and carbon footprint certifications. Starting with Water Bank productline and Water Sleeping Mask, the brand expanded water footprint measurements to Cream Skin
Toner & Moisturizer, to improve their products’ environmental impact. LANEIGE saved a total of
3,390,351 liters of water throughout its products’ lifecycle, calculated based on the brand’s annual
sales volume in 2022.

Amorepacific Group is expanding the use of sustainable palm oil to minimize its environmental impact
caused by the production of the raw material, such as the destruction of rainforests. In 2022, brands
including Sulwhasoo, Mise en scène, HERA and ETUDE used sustainable palm oil in a total of 428 new
products.

HAPPY BATH is working to expand vegan products, free from animal-derived raw materials and animal
testing. All of the 13 products in HAPPY BATH Original Collection Body Wash and Lotion obtained
vegan certification through the Korea agency of Vegan Certification and Services.

IOPE’s Stem III Cream reduced its environmental impact byimplementing a green chemistry process that reduces energy
consumption in the manufacturing process by 40% compared to theprevious method. To further minimize the use of packaging materials,
the brand introduced refillable containers, and used FSC-certified paperfor secondary packaging, incorporating various eco-friendly elements.

In 2022, raw materials purchased through Beautiful Purchases Agreement were used in five new
products from brands including Sulwhasoo and Mamonde. To this end, we purchased 30 raw materials,
made with 23 agricultural produce, worth KRW 3.3 billion from the Beautiful Purchases Agreement
regions.

Launched in 2022, ETUDE Soonjung Director’s Sun Cream was certified by EVE VEGAN, a French Vegan
certifying body, as a vegan product, and was formulated to be reef-friendly, so it would not cause thewhitening of coral reefs, often caused by sunscreens.

AMOS Professional Green Flair is a premium hair dye certified vegan by
the Korea agency of Vegan Certification and Services. It is a vegan hair dye
formulated with plant-derived ingredients that allows customers to dye their
hair with peace of mind, as it is free from 10 problematic ingredients such as
ammonia, sulfate surfactant, and silicone oil.

26

Strategy 3

Related 2030 A MORE Beautiful Promise Detailed Strategies

Energy Usage

Promise 3

100% Renewable Energy Procurement

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

Amorepacific became the first South Korean company in the beauty industry to
through external procurement, we intend to secure renewable energy throughjoin the global RE100. RE100 is a global initiative to procure 100% of the electricity various means such as direct and indirect PPAs1), VPPAs2), green premium plans,and certificate purchases. We have established energy saving plans customized
used, from renewable energy. Amorepacific is actively promoting the transition
according to the characteristics of the workplace and continue to invest in renewable
to renewable energy through various available means in South Korea, aiming toachieve RE100 in 2025. In particular, we are carrying out activities that reduce our energy. In addition, each business site manages energy use and related indicators as
energy usage while increasing energy efficiency, such as expanding the application important KPIs.
of low-energy process technology, manufacturing products at low temperatures.
Also, we aim to expand our on-site self-generation facilities within our businesspremises to produce and utilize renewable energy. As a means of implementation

Strategy Implementation Status

100%(Target)

RE100 Implementation Roadmap

1) PPA (Power Purchase Agreement)
2) VPPA (Virtual Power Purchase Agreement)

Approach to Achieve RE100
Energy savings and efficiency

50.0%(Target)
Expansion of self-generated solar power

34.1%

Supply of renewable energy to workplaces
through direct and indirect renewable energy
purchase agreements

18.5%
0.4 %

Utilizing the Green Premium Plan

4.9%
Purchasing renewable energy certificates

2011

2020

2021

2022

2023 Goals

2025 Goals

27

Risk Management

Metrics & Targets
Topic

Amorepacific Group operates a company-wide integrated risk
management system that identifies potential risks throughout
the business, and prevents and manages identified risks. We
evaluate the extent of the impact of the potential risk according
to the risk management process from “limited impact” to “verysignificant impact” in both financial and non-financial terms.
The three material topics identified by the severity assessment
are managed separately. By clarifying the responsibilities andauthority according to the corporate-wide integrated risk
management process, we are systematically and proactively
implementing ongoing management activities pertinent to thematerial topics.

1

2

3

Environmental Impact of Packaging Materials
Amorepacific Group, which produces and sells cosmetics
consumer goods, prioritizes the management of issues
related to the environmental impact of our packaging
materials. There is a risk that costs related to regulatorycompliance may rise, especially as regulations on packaging
materials and waste management become stricter worldwide.
Accordingly, Amorepacific Group seeks to increase theproportion of environmentally friendly packaging materials
and enhance the recyclability of plastic packaging.

Sustainable Products and Services
Amorepacific Group manages changes in market demand inaccordance with consumer preference shifts. As consumers’
demand for sustainable products and services increases,
we shall respond by improving the environmental impactof our products. We will minimize risks in the domestic andinternational markets by securing advantages in technology
and quality competition, in response to changing consumer
preferences.

Goals

Environmental · Design all plastic packaging
materials to be 100% recyclable,
Impact ofreusable, or compostable by 2030
Packaging
Materials· Use recycled or bio-based plastics
for 30% of all plastic packaging by
2030

Sustainable
Products andServices· Implement environmental andsocial-friendly attributes in 100%of new products by 2030

Indicator

Performance1)· Percentage of recycled or bio-based Percentage of recycled or bio-based
plastic used out of total plastic
plastics usedconsumption· Percentage of recyclable or reusable
packaging materials· Percentage of new products withenvironmental and social-friendly
attributes

3.9%

7.2%

2021

2022

Percentage of new products withsustainable attributes

88.0%

90.5%

2021

2022

Energy Usage
Climate risk is the most urgent challenge globally. At thenational level, greenhouse gas emission management
standards are being strengthened, and accordingly,
Amorepacific Group manages energy usage as a material
issue. We have declared our commitment to achieving carbon
neutrality at global production sites by 2030 and we are
actively endeavoring to increase our renewable energy usage.

Energy Usage· Achieve carbon neutrality at global
production sites by 2030
· Use 100% renewable energy at
global production sites by 2030

· Energy consumption· Percentage of renewable electricity
usage

Percentage of renewable electricity
usage

18.5%
1) Results of Amorepacific

2021

34.1%
2022

28

2022 Highlight 1
Expanding EcoFriendly Packaging
and Sustainable
Products

Amorepacific Joins the EcoBeautyScore Consortium
Amorepacific became the first South Korean company inthe beauty industry to join the EcoBeautyScore consortiumin February 2022. The EcoBeautyScore consortium is aconsultative body established by global cosmetics and personalcare companies, and professional associations with the aim ofdeveloping a scoring system that evaluates and measures theenvironmental impact of cosmetics. Amorepacific establishedthe foundation for environmental footprinting and scoring
methodologies through participation in the consortiumand developed the primary model for measuring cosmetics
environmental footprints. In the future, we will continue tomeasure the environmental footprint of our products based on
advanced methodologies and provide accurate and transparent
results to our customers.

Published the Research Results on Environmentally-friendly Hair Strengthening and Curling Technology
Using Visible Light in an International Journal

Amorepacific Group is committed to reducing the useof plastic and increasing recyclability at all stages of our
product’s lifecycle, including planning, development,
production and usage. In addition, we are introducing
various sustainable products to improve our product’s
environmental impact based on the technology
accumulated through research activities.

Amorepacific R&I Center and a joint research team at Gachon
University College of Engineering conducted a research toreplace hair perming ingredients that are harmful to theenvironment and to the hair and scalp. As a result, we havesuccessfully developed hair care and hair perming technology
harmless to the environment, and the human body while
not damaging the hair. The joint research team noted that a
combination of vitamin B and visible light along with otherformulation ingredients, can induce a crosslinking reaction of
hair proteins. It has been confirmed that this combination isharmless to the human body and can enhance the mechanicalstrength and curling effect of the hair. The findings were
published on June 2022 in the prestigious international journal‹‹Journal of Cleaner Production›› (IF (Impact factor) 10.956).
The R&I Center plans to develop new products using theresults and solutions found through this research project.

VITAL BEAUTIE Super Collagen Essence Biotin was
Selected as Korea’s Green Product of the Year in
2022, for the First Time as a Health Functional Food
Product
VITAL BEAUTIE Super Collagen Essence Biotin was selected as
Korea’s Green Product of the Year in 2022. The “Korea Green
Product of the Year” award was established in 2008 by the
Korea Green Purchasing Network, a non-profit civic group,
and is sponsored by the Ministry of Environment to encourage
consumers to use more environmentally friendly products
and induce companies to make more green products. Super
Collagen Essence Biotin, which was the first health functional
food product to be selected for this award, was highly
appraised for reducing plastic packaging and not utilizing
preservatives and artificial pigments. The existing methodof drinking one bottle a day was improved by the use of alarge container containing collagen to be drunk over 10 days,
reducing plastic usage by 64.2%. This resulted in an annual
reduction of 17.6 tons in plastic usage.

high-pressure ginseng processing, was certified as a green
technology product in August 2022. Green technology productcertification is a system that certifies promising technologies
or projects under the Framework Act on Low Carbon, Green
Growth, promulgated in 2010. The certifications are given
after the evaluation from Green Certification Committee, ofthe products and technologies submitted by Korea Institutefor Advancement of Technology. Cheonsamhwa technology
applied to Red Ginseng Extract and Deer Velvet Ampoule is an
eco-friendly technology that has obtained Green Technology
Certification by reducing energy usage by more than 10%
compared to the existing method, through simplifying the red
ginseng processing process.

Mono-material High Barrier Polypropylene Pouch
Technology Wins the Korea Star Awards

VITAL BEAUTIE Red Ginseng Extract and Deer
Velvet Ampoule Obtains Green Technology Product
Certification
VITAL BEAUTIE Red Ginseng Extract and Deer Velvet
Ampoule, which uses Cheonsamhwa technology for ultra-

Amorepacific won the Bucheon City Mayor Prize at the
Korea Star Awards with the development of mono-material
packaging technology with excellent recyclability. The highbarrier PP mono-material pouch is highly recyclable, as it ismade with mono-material, and has high barrier properties
against contents leackage and inflow of foreign substances.
This technology enables us to replace the existing multilayer
aluminum film pouch, which is difficult to recycle, with a PP
mono-material pouch using transparent inorganic oxide(SiOx)
nano film deposition technology. Amorepacific plans to avoid
using composite materials for the packages as they are difficult
to recycle, and expand products with excellent recyclability by
developing mono-material packages.

292022 Highlight 2
Various Efforts toExpand Renewable
EnergySouth Korea’s First-Ever Direct Renewable Energy
PPA (Power Purchase Agreement) Contract Signed

Signs South Korea’s First-Ever Virtual Power
Purchase Agreement with Jeju Village Wind Power

Amorepacific became the first South Korean company in thebeauty industry to join RE100 on March 10, 2021, and plansto replace all electricity used at all its production sites, theR&I Center, the logistics and regional offices, with renewableenergy by 2025.

In November 2022, Amorepacific signed the nation’s firstever virtual power purchase agreement2) with Bukchon
Seomo Wind Power Co., Ltd., a wind power plant in Bukchonri Village, Jeju. This was the first achievement of the “PublicPrivate Cooperative Jeju-style RE100 Trading Market System
Establishment Agreement” conducted by Jeju Provincial
Government. Through this we will lay the foundation for
effective use of renewable energy and play a leading role inpromoting carbon neutrality.

To that end, in 2022, Amorepacific signed a PPA with SK E&S, aprivate power generation operator, becoming the first in Korea
to purchase renewable energy directly. Amorepacific Daejeon
Daily Beauty production site will receive renewable energy
power generated electricity from a 5MW solar power plant
through direct PPA, for 20 years. This is expected to reducegreenhouse gases by about 2,700 tons per year. Amorepacificis leading the way in implementing RE100 by becoming thefirst-ever to sign a direct contract for renewable energy.

Yeonggwang Jungang Solar Supplies Renewable Energy to Amore Beauty Park

Manufacturing of Products through 100%
Renewable Energy
Amorepacific has signed a third-party PPA1) with Korea ElectricPower Corporation and EcoNetwork to receive renewableenergy for 20 years. Through this agreement, Amore Beauty
Park in Osan has been receiving renewable energy produced
from a 2MW solar power plant since February 2023. This will
reduce greenhouse gases emission of the plant by more than
1,100 tons per year.

Amorepacific Group continues to invest in renewableenergy to reduce the environmental impact ofmanagement activities and expand its positive impacts
on the planet and society by actively responding toenvironmental problems faced by the world. As partof our efforts, we are continuously working towards
achieving RE100, such as entering into the first-everdirect renewable energy supply contract domestically.

This virtual power purchase agreement enables us to secure
3MW of wind power renewable energy for about 17 years,
until 2040. The renewable energy certificate obtained throughthis agreement enables the conversion of renewable energy toAmorepacific buildings and workplaces, contributing greatly tothe achievement of RE100. Furthermore, we plan to ensure thefixed income of residents in need of financial independence,by settling the difference between the fixed price and thewholesale market price of electricity on a monthly basis.
Amorepacific will co-prosper with local communities and work
together with them to transform to renewable energy in theera of the climate crisis.

Amore Beauty Park has already established its own 2.6MW
solar power infrastructure, and has been recognized by
Korea Electric Power Corporation for its green premium useof renewable energy to redress the periodical lack of solar
power or the lack of power generation. As a result, Amore
Beauty Park has been reborn as a production site that uses
100% renewable power to manufacture products by securing
additional renewable energy through third-party PPA.
1) T hird-party PPA: A system in which Korea Electric Power Corporation enters
into a purchase contract with a power generation operator and a sales contract
with a company, to trade renewable energy power between three parties2) V irtual Power Purchase Agreement: A type of transaction in which a company
assumes the market risks associated with the sale of electricity at a plant andreceives an energy certificate

302022 Highlight 3
Developing
Customized
Products
through Digital
Transformation

As customers’ lifestyles become more diverse,
expectations are growing for customized products
and services tailored to their individual interests andneeds. Through digital innovation, Amorepacific Group
provides products and services optimized for individual
characteristics such as skin type and sleep patterns
to provide differentiated experiences and increasecustomer satisfaction.

Development of Personalized Sleep Solutions throughResearch Collaboration

COSMECHIP, customized skincare cosmetics manufacturing device

COSMECHIP, a Customized Cosmetics Manufacturing
Device, Wins the CES Innovation Award
COSMECHIP, which won the CES 2023 Home Appliance
Innovation Award, is a device that offers customized skincare
cosmetics through the insertion of ACTIVECHIP, whichcontains active ingredients. The ACTIVECHIP can respond
immediately to the short-cycled changing needs of customers,by manufacturing two weeks’ worth of cosmetics according
to their skin concerns. The microfluidic channel technology
developed by Amorepacific has been applied, to uniformly
combine small amounts of water and active ingredients.
In addition to providing a choice of active ingredients for
product efficacy, it provides adjustability in product oilinessand texture according to the customer’s preference. The active
ingredients stored in the ACTIVECHIP do not contain moisture,and therefore they can be stored stably for a long time,preserving their efficacy in the best condition until delivery to
the customer. Authentic Color Master by TONEWORK, which
won the Innovation Award in Robotics, is a customized smart
makeup manufacturing system solution based on AI and robot
arms. Artificial intelligence algorithms with facial recognition
technology and color theory approach accurately assesscustomer’ skin tones and recommend optimal makeup colors.
High-precision robotic arms can manufacture a variety of
makeup products in a short time, such as bespoke foundations,cushion foundations, and liquid lipsticks.

Amorepacific signed a business agreement with Asleep tostrengthen cooperation in sleep research. Asleep is a SleepTech
startup that possesses a solution for diagnosing various sleep
conditions by collecting breathing sound data during sleep
in a non-contact manner and analyzing the data using AI
technology. Unlike other sleep analysis technologies, Asleep’s
technology has the advantage of being easy to use, as only asmartphone is needed to measure the sleep states without any
direct contact with equipment. It also enables more precise
sleep analysis than traditional wearables (smartwatches etc.)
and assistants (pads, pressure sensors, etc.).
Amorepacific will collaborate with Asleep to develop a nextgeneration sleep solution to expand the share in the sleep
market. With the goal of further strengthening our global
competitiveness in the “Sleeping Beauty” category, we willscientifically verify cosmetics and health functional foods
through ultra-personalized advanced sleep diagnostics. We
will secure our competitiveness in the sleep market throughvarious initiatives. Furthermore, we plan to improve the qualityof our customers’ lives by introducing Amorepacific’s unique,personalized sleep-related products.

Agreement between Amorepacific and Asleep on Sleep Research Cooperation

Providing Customized Cosmetics using AI-based Skin
Diagnosis Technology
Dr. Amore® is a skin image diagnosis AI technology developedby Amorepacific, based on over 60 years of our skin research,

and AI technology. The AI technology utilizes the learnings ofmore than 20,000 skin photos analyzed by clinical experts. It
allows us to accurately measure various skin conditions suchas wrinkles, pores, pigmentation, and erythema based on one
single photo without expensive skin measuring equipment.
Hence, it has become our standard skin diagnosis platform, as itis suitable for large-scale customer skin research and contactless
personalized customer services.
In addition, CUSTOM.ME, a brand that offers products
and solutions tailored to customers’ skin types, launched
CUSTOM.ME Bespoke Essence, an ultra-personalized
cosmetic product, in early February 2023. When customers
upload their facial photo on to the CUSTOM.ME+ phone
application, AI technology diagnoses skin conditions andprovides personalized skin analysis reports. After analyzing thesurvey on skin concerns and lifestyle, the optimal product ismanufactured by combining two active ingredients customized
to skin conditions and a formulation suitable for specific skintypes.

Development of the World’s First Electronic Skin withMIT Research Team
Amorepacific developed the world’s first “chip-less and wirelesselectronic skin” in collaboration with a research team at MIT(Massachusetts Institute of Technology). Using a chip-free,
epitaxial freestanding compound semiconductors, the sensor
is highly sensitive and can be attached to curved skin, allowing
customers to wirelessly measure their individual skin condition
anytime, anywhere, without cumbersome equipment. Skin
diagnosis for people who work in special environments
and need to withstand extreme cold, heat, and dryness has
become easier, and with this technology it has enabled us todevelop customized functional cosmetics for them as well.
The transmitted skin diagnosis results will be used as datanecessary for the development of customized cosmetics andvarious functional cosmetics in the future.

31

Chapter 3

Our Performance

32

Environmental

2022 Performance

Expansion of conversion into renewable energy

Proportion of Renewable Electricity Use
34.1%1)
1) Based on data for AmorepacificDaejeon Daily Beauty production site, first-ever in South Korea

Signed Renewable Energy Direct
Power Purchase AgreementPPA
Osan Amore Beauty Park, first in South Korean beauty industry

Obtained Zero-Waste-to-Landfill ZWTLVerification

33

Environmental
Management
SystemEnvironmental Management
Implementation System
Environmental Policy
Amorepacific Group aims to minimize the environmental
impact generated by its business activities and fulfill its social
responsibility for environmental conservation. This sense of
responsibility and willingness are well contained in the Group’s
environmental policy. All our employees recognize the valueof the environment, strive to comply with environmental
policies, and fulfill their responsibilities and obligations
toward the circular economy in all areas of work. In addition,
Amorepacific Group’s responsibility towards the environment
is considered throughout the process of its businessactivities. We have established a Group-wide environmental
management system to minimize our environmental impact
through continuous evaluation and improvement. In order tomanage the environmental impact generated by the supply
chain as well as the activities of Amorepacific Group, we
consider environmental risks at the stage of supplier selection
and continue to communicate with suppliers on major
environmental issues.
Environmental Policy

Amorepacific Group established an environmental
policy to minimize environmental impact fromthe perspective of the entire business activities
and processes, and established an environmental
management system covering all workplaces.

Management System for Environmental Management
Amorepacific Group has applied the environmental management
systems verified through an international standards, ISO 14001
to all production sites to promote sustainable environmental
management. For the first time in the beauty industry,
Amorepacific Group obtained the integrated environmental
permission (No. 0294-01) in line with its aim to minimize its
negative impact over the course of the entire production cycle,
through operating environmental management systems that meetinternational standards.
In addition, business sites within Amorepacific Group comply
with SHE (Safety, Health, Environment) management standards,
designed as a four-step Plan-Do-Check-Act process. We operateGroup-wide standards for environmental management by deriving
31 management items based on SHE Group guidelines. We haveestablished a risk-oriented audit system and are implementing
improvement activities continuously, focusing on problems withhigh risk scores.
In addition, we have established an environmental and energy
accident response system and regularly conduct emergency
response training every year. In addition, Amore Beauty Park
operates an enhanced environmental accident emergency response
procedure in accordance with the revised internal environmental
regulations. There are a total of 17 emergency response manuals
for possible environmental accidents in each situation, including
waste transport and storage, movement of formula and semifinished products, movement and warehousing of raw material,
and the handling of laboratory reagents. In the event of anenvironmental accident, it is mandatory to report and take action
according to prevention and response guidelines.

SHE Management Standards
Plan

Do

Reg. 1

SHE management system

Reg. 2

Risk assessment and management

Do

Reg. 14DoManagement of hazardous and dangerous

Reg. 27

Energy and greenhouse gas managementtasks

Reg. 28

Environmental impact assessment

Reg. 15

Management of the work environmentReg. 16

Health and hygiene management

Check

Reg. 3

Legal managementReg. 17

Management of visitors’ safety

Reg. 29

Monitoring & measurementReg. 4

Managing documents and recordsReg. 18

Management of safety and health duringReg. 30

Audit and inspectionReg. 5

Resource managementbusiness trips

Reg. 6

Training managementReg. 19

Reg. 7

Communication managementReg. 20

Reg. 8SHE management for partners

Reg. 9Emergency managementReg. 10

Management of facilities and equipment

Reg. 11

Management of chemicals

Reg. 12

Management of specific substances

Reg. 13

Safety management of vehicles andunloading machines

Safety and health management for events
Safety and health management for daycare
centers

Reg. 21

Management of safety cultureReg. 22

Water managementReg. 23

Atmosphere and odor managementReg. 24

Waste managementReg. 25

Noise and vibration managementReg. 26

Soil and groundwater pollution management

Act
Reg. 31

Corrective action for nonconformity

34Management of Environmental Performance

Environmental Investment and Education

Amorepacific has established mid- to long-term
environmental goals for important environmental issues
such as packaging and energy in accordance with the fivesustainable management goals specified in ‘2030 A More
Beautiful Promise,’ and is carrying out management activities
to reach the goals. The annual performance towards thegoals is linked to the compensation system for executives toencourage their active participation in the efforts to achieve
them. Furthermore, every year, production sites set targets
for the ‘Environmental Operations Index’ and monitor theirperformance every month. This performance has been linked
to the KPIs of related executives and employees to further
strengthen the execution of environmental performance
management.

Amorepacific Group conducts environmental investments
to operate a smooth environmental management system
and achieve environmental goals. In 2022, environmental
investment and operation costs totaled 4.55 billion KRW for theAmorepacific Group and 4.5 billion KRW for Amorepacific. In
addition, prior to making new investments, environmental risks
are reviewed in advance based on the safety and environmental
checklist. Matters related to environmental regulations
compliance, and safety and health are checked alongside thechecklist, and new investments are made only for cases verified
by the teams in charge of safety and environment.
Amorepacific Group provides in-house environmental education
on plastics, environmental labeling/advertisements, climatechange, and chemical substances to raise the level of awarenessregarding eco-friendly management among all employees. In
particular, the Subcommittee on Environment and Energy isconducting training for environmental practitioners in addition
to the compulsory legal education. We strive to enhance thecapabilities of the working-level staff in charge of environmental
management, through education on policies and trends
related to the environment & energy, management of pollution
prevention facilities, and practical training on building energy
conservation. In 2022, we reviewed legal operations through onsite visits to all domestic production sites and conducted training
on environmental policy trends and legal implementation. As aresult, there were no significant environmental violations and nofines for environmental violations in 2022.

Number of Participants in

Environmental Education Hours

Environmental Education(Based on data for(Based on data for

Amorepacific Group)

Amorepacific Group)

Total

2,967

employees

Total

7,469

hours

35

Response to Climate
ChangeMeasures for Responding to Climate
ChangeAmorepacific has established a climate change strategy torealize carbon neutrality based on its eco-friendly beauty
leadership spanning over 30 years. The two pillars ofAmorepacific’s climate change strategy for achieving carbon
neutrality are process innovation, and product innovation.
Through process innovation, Amorepacific seeks to minimize
climate impact across all the processes of the compnay,
production, logistics, and suppliers. First of all, we will primarily
focus on the production part of the entire product lifecyclefrom production to disposal, to convert the electricity used
into renewable energy. By 2025, Amorepacific’s headquarters,
R&I Center, stores, and sales offices will use 100% renewableenergy to minimize the climate impact of the entire process.
Through product innovation, we will reduce GHG emissions
at the product level and lay the foundations for various
stakeholders to work together on climate crisis. We will reduce
our products’ environmental footprint by reducing GHG
emissions throughout the entire process, from raw material
production, product usage, to product disposal. Furthermore,
we will join forces with various stakeholders, including
the government, companies, suppliers, and civic groups toovercome the climate crisis.

Amorepacific’s Climate Change Strategy for Carbon Neutrality

PROCESSINNOVATIONPRODUCTINNOVATION

Company-wide

Products

Global production sites, Amorepacific headquarters, R&I
Center, regional offices, etc.

Use

Expand the range of products with
reduced water/carbon usage100% renewable electricity

Reinforce R&D on green chemistry
Reduce the use of virgin plastics

Production

Improve packaging materials andstructures

Global production sites

Achieve carbon neutrality at
production sites

52030 Carbon
Neutrality

Logistics

Convert toConsumers
Improvement of awarenessDomestic logistics

Amorepacific aims to realize Carbon Neutrality andfulfill its responsibilities regarding climate change asa global corporate citizen, by reducing GHG emissions
and offsetting emissions generated by production
processes and corporate activities. In particular, we
will respond actively to climate change by expanding
the use of renewable energy in product manufacturing
processes and reducing GHG emissions from the entire
process of corporate activities, including supply chains.

Development of products with reduced environmental
footprint

100% eco-friendly vehicles

Suppliers
Assess suppliers’ sustainability and work together toreduce GHG emissions

Provide firsthand eco-friendly
experiences and expand education

36

2030 Carbon Neutrality Roadmap

Conversion to Renewable Energy

Ensuring Energy Efficiency in Production Sites

Transition to Low Carbon Logistics

Amorepacific recognizes the seriousness of climate change
and, as a responsible global corporate citizen, is working
hard to reduce GHG emissions stemming from corporate
activities. To this end, we have established a 2030 Carbon
Neutrality Roadmap in consultation with the industry,
academic experts and top management. Amorepacific will
reduce 100% of Scope 1 and 2 emissions by 2030 compared
to 2018 emissions. In 2022, Amorepacific increased the shareof renewable electricity used at all workplaces up to 34.1% andincreased energy efficiency at production sites, reducing GHG
emissions by 42.7% compared to 2018. By 2022, eight of thedomestic vehicles were converted to electric vehicles, and five
rapid chargers have been installed to continue the eco-friendly,
carbon neutral transition.

Amorepacific was the first in the South Korean beauty industry
to have joined RE100, a global renewable energy campaign.
Recognizing the importance of expanding renewable energy
to overcome the climate change crisis, we are making various
attempts to utilize the newly revised domestic renewableenergy policy with the aim of achieving RE100 early, in 2025.
In 2022, we were the first in South Korea to sign a direct
PPA for renewable energy, with SK E&S. Through this, it isexpected that Daejeon Daily Beauty production site will receive
5MW of renewable energy for 20 years from the first half of2023, reducing GHG emissions by about 2,700 tons per year.
Additionally, in 2022, Amorepacific signed a third-party PPA
with Korea Electric Power Corp. and Eco-Network. Amore
Beauty Park, which produces major Amorepacific products
such as Sulwhasoo and LANEIGE, has already secured its own
2.6MW solar power infrastructure, and it has been able toproduce products using 100% renewable power from 2022
due to the supply of renewable power through green premiumand third-party PPA. Furthermore, in 2022, Amorepacificsigned South Korea’s first-ever renewable energy virtual powerpurchase agreement (VPPA) with SK E&S and Bukchon Seomo
Wind Power, and will receive 3MW of renewable energy forabout 20 years.

Osan Amore Beauty Park has been carrying out various
activities to reduce energy consumption and increase theproportion of renewable energy usage. First, we reduced our
total energy use through enhancement of energy efficiency
and conservation activities. Also, we are expanding in-house
power generation facilities to produce our own renewableenergy as much as possible, even though this requires costinvestment and maintenance efforts. In 2022, 4% of the total
electricity used at production sites was obtained from solar
power generation, and we plan to expand our own power
generation facilities in the future. In addition, Osan Amore
Beauty Park achieved RE100 in 2022 through the purchase ofgreen premium plan and the signing of PPA.

Amorepacific also aims to minimize GHG emissions in areasof direct and indirect activities involved in product delivery.
To this end, we have now adopted eight electric vehicles andoperate five rapid chargers. We are continually converting
logistics center vehicles into eco-friendly vehicles, and plan
to convert all related distribution vehicles into eco-friendly
vehicles by 2030.

In addition, Amorepacific’s business sites are making various
efforts to independently produce renewable energy. Since
2021, 100% of the electricity used in Shanghai Beauty
production site is from renewable energy. Also, solar power
generation facilities the size of 1.6MW have been installed inAmore Beauty Park in Osan, Daily Beauty production site in
Daejeon, and Beauty production site in Shanghai. Currently,
Amorepacific generates and uses its own renewable energy
from the 4.3MW solar power plant installed. Along with theadditional renewable energy secured through VPPA, we wereable to convert 34.1% of the company’s electricity used in 2022
into renewable electricity.

Furthermore, we have combined innovation in the facility
operation process and electricity conservation activities inour daily work life to reduce overall energy consumption. We
established a system to control the ventilator, which operated
24 hours a day, regardless of facility operation. Additionally,
we improved our facilities to reduce power consumption
while bettermenting funtions to prevent air pollutants being
released into the air, and these measures were selected asa best practice by the Ministry of Environment.Electricity
consumption was reduced by changing the thermal or heating
system of the production facility, and activities for continuous
energy savings were identified and implemented throughelectricity conservation initiatives and energy task force (TF)
activities. Representatively, Osan Amore Beauty Park reduced
the annual gas (Scope 1) usage by 72,519m3, and electric(Scope 2) usage by 812,276kW by applying motor inverters,
controlling temperatures for heating and cooling systems,
improving lighting control efficiency, and upgrading facility
functions.

Percentage of eco-friendly vehicles owned(Based on separate data for Amorepacific)

7.9

%

37

Eco-friendly Building Design
Amorepacific Group is constructing environmentally friendly
buildings to achieve energy efficiency in its operations.
Amorepacific headquarters is an eco-friendly building verified
with ‘First Grade G-SEED (Green Standard for Energy andEnvironmental Design) Certification,’ ‘First Grade Energy
Efficiency,’ and ‘Gold Grade LEED (Leadership in Energy andEnvironmental Design)’. The building is designed to consume
37.6% less energy than the projected energy demand.
In addition, Amorepacific is expanding the use of renewableenergy, including solar power generation facilities installation
in idle spaces at its headquarters and production sites toincrease renewable energy generation following the RE100
declaration. Solar panels are installed and operating in
Amorepacific headquarters, Osan Amore Beauty Park, andInnisfree Jeju House. In the case of Amorepacific headquarters
building, about 4.2 TJ of renewable energy, including solar andgeothermal energy, is produced and used in-house. China’s
Shanghai Beauty production plant installed solar power
generation facilities to achieve carbon neutrality with 100%
renewable energy in 2021, and also remained carbon neutral
in 2022. Until now, we have installed solar power generation
facilities with 4.3MW capacity by utilizing idle spaces at various
domestic and international workplaces.

In particular, Osan Amore Beauty Park is a space that receives
attention for its eco-friendly design. Osan Amore Beauty Park
has already secured its own power generation infrastructureof about 2.6MW by installing solar modules on the roof of thelogistics building, and is designed to use energy efficiently to
curb GHG emissions. It is equipped with a heat shrink systemusing late-night electricity to store cold water late at night andthen use it for cooling during the day. It is also designed tomaximize natural lighting and reduce electricity usage throughAI lighting. Rainwater storage and purification facilities are
installed to reuse more than 6,000 tons of rainwater annuallyfor landscaping and washing work clothes, and further theamount that accounts for 30% of the total water required forthe entire production process is recycled.

Solar Power Generators Installed on the Roof of Osan Amore Beauty Park

38

Management of
Climate Risks andOpportunities

Amorepacific Group recognizes the seriousness ofclimate change and considers it an important factor
to consider in business operations. We evaluate
climate risks and opportunities systematically, reflect
factors that have a large impact on the company inour management strategy, and strive to respondproactively to risks by establishing appropriate
countermeasures.

Climate Risk and Opportunity Management
SystemClimate Governance

Climate Risk and Opportunity Management Process

Climate risks and opportunities are managed and supervisedby the ESG Committee under the Board of Directors.
Specifically, reports and decisions on climate strategies, actionplans, and implementation performance are made by the ESG
Committee every quarter. In 2022, internal and external trends
related to climate change, and investment plans and outcomesfor reducing GHG and driving RE100 were discussed at the
ESG Committee meetings. The Sustainability Committee,
composed of top management, works with the ESG Committee
to make strategic decisions on climate agendas and monitor
the implementation of tasks to address key challenges.

Amorepacific Group periodically identifies risks andopportunities that are highly associated with the company’sbusiness, and evaluates the level of impact of the identified
factors to select significant risks and opportunities. We alsouse climate-related scenarios to analyze the impact of climate
risks and opportunities over time and reflect the findings in ourbusiness strategy.
This climate risk management process is integrated into theEnterprise Risk Management process. The ESG Committee
manages climate risks regularly, and a company-wide Risk
Management Committee comprised of top management
discusses solutions and prepares countermeasures in the eventof significant climate risks.

Step 1
Identify climate risks andopportunities

Step 2
Assess climate risks andopportunities

Step 3
Analyze climate scenarios

39

STEP 1: Identify Climate-related Risks and Opportunities
Amorepacific Group aims to minimize negative impacts through preemptive responses by identifying climate risk factors. We also want to
identify opportunity factors, reflect them in management strategies and activities, and thereby realize new growth engines. According to
the TCFD recommendations, climate risks were divided into transition risks and physical risks, and risks and opportunities that are highly
relevant to the company’s business were identified.

Key Climate-related Risks and Opportunities Factors
Category
Transition

Climate-related Risks

Climate-related Opportunities

Emerging Financial Impact·T he Group’s exclusion from GHG management· Increased costs for responding toemissions

regulations in accordance with the 2030 carbon

climate-related regulations· Increased product export risks and complianceneutrality goals for production sites.

· Minimized variable fossil fuelcosts due to stricter regulations on packaging·D ecreased cost exposure associated with thecosts through 100% conversion tomaterials and waste management globallyrising fossil fuel prices, through the expansion ofrenewable energy

renewable energy generation.

· Reduction of mid-to-long term·R
 educed EPR costs through the development of

production costs through efficient

recyclable products.

energy facilities

Technology · Increase in water and energy usage at business· S ecuring competitive advantage in technology and· Increased energy costs due to newsites due to the advancement of product quality

quality based on changing consumer preferences

investments, research, and equipmentlevels (such as acquiring facilities)· Establishing a low carbon production process

purchases

Regulations · Strengthened reporting obligations for GHG

Risk

Products· Increased strain to research on low carbon and· Reduced costs by reusing water andwater-saving products and technologies

rainwater· I ncreased consumption of low carbon and water-· Cost increases due to rising costs of raw

saving products

materials caused by extreme weather· Increased uncertainty in the supply of raw/subsidiary·C reating new market value by adapting to climate· Increased demand and sales of low

materials due to extreme weather conditions

changecarbon and water-saving products·C hanges in market demand and revenue due toand Services changes in consumer behavior·R estrictions on the use of water-intensive products· Reduced operating costs through the(including shampoo and body wash) in countries

transition to eco-friendly logistics,

with water stresstransportation, and sales methods

Reputation · Negative views and evaluations fby stakeholders(including NGOs)· S incere communication and building trust with· Decrease in sales due to a decline incustomers by expanding eco-friendly activities

customer trust· Sales growth achieved bystrengthening the eco-friendly image

Physical Risks· Reduced quality of raw/subsidiary materials and· E stablishment of measures for adapting to climate· Financial losses due to discontinuation

products due to sudden temperature changes

change, leading to reinforcement of facility safety,of production· Production disruption (transportation, supply chain

employees’ health management, and product· Avoiding emerging risks by

disruption, safety and health issues, absenteeism,

quality management.

establishing a preventive climateetc.) due to increased incidence of extreme weather
conditions (e.g. typhoons, floods)· Increased repair costs due to facility damage

adaptation management strategy

STEP 2: Assess Climate-related Risks andOpportunities
The identified factors are classified into four categories basedon the enterprise risk management process: market, product,
supply chain, and sales and distribution networks to assess
the extent of impact. Through the evaluation, potential
factors that have a significant impact on the overall businessare selected among various risk and opportunity factors, andmeasures are established and implemented by the relevant
departments to respond effectively to the factors.
The assessment found that the most significant of the physicalrisks were power outages due to extreme weather conditions
and facility outages due to disruptions in the heating andcooling systems. Damage to the facility is expected to increase
the cost of repair. It is also expected that among the transition
risks, we have a high chance of facing risks related to thecarbon border tax. In particular, Amorepacific Group exports
its products to various overseas countries in Asia, Europe, andNorth America, so price competitiveness may deteriorate due
to increased production and export costs when the carbon
border tax is applied.
According to the analysis, the significant opportunity
factors were the creation of new market value through thedevelopment of eco-friendly products and services, and the
reduction of mid- to long-term production costs due to theefficient use of energy/water. Amorepacific Group may gain
market leadership by providing customers with sustainableconsumption opportunities in line with changes in consumers’
eco-friendly preferences, and implementing differentiation
strategies. Furthermore, expanding the use of renewableenergy offers an opportunity to minimize the cost exposure
from increasing fossil fuel prices and carbon taxes.

STEP 3: Analyze Climate-related Scenarios
Through climate-related scenario analysis, AmorepacificGroup identified the future climate risk level in detail. IPCC
RCP Representative Concentration Pathways(RCP) 4.5 and RCP
8.5 scenarios were used to assess physical risks, and IEA SDS
scenarios were used to assess transition risk and opportunity
factors.
Scenario analysis confirmed that for physical risks, the riskof plant closures due to large-scale flooding, water resource
risks, and increased precipitation will be the most significant
factors. Based on the evaluation results, a response strategy
was established to minimize their impact throughout the entire
business process. Specifically, we are expanding the use of
rainwater in our workplaces, conducting regular facility safety
inspections with regards to weather changes, and increasing
the efficiency of energy use by expanding the use of renewableenergy.
Since the cosmetics industry has less energy consumption andcarbon dioxide emissions than other industries, the possibilitiesof transition risks such as carbon taxes and energy costs areless compared to other industrial sectors. However, if carbon
dioxide is released at the current rate, operations of theAmorepacific Group are expected to cause much more carbon
dioxide emissions by 2030. Since carbon dioxide reduction
activities are essential to achieve the carbon reduction target
set by Amorepacific Group for 2030, we have established a
response strategy to achieve the reduction targets. We will
actively pursue the development of new technologies to reduce
Scope 1 emissions and expand the installation of renewable
power facilities and purchase of renewable electricity to reduce
Scope 2 emissions.

40

Minimize
Environmental
ImpactReducing the Environmental Impact of
Production Sites
Integrated Management of Chemical Substances
Amorepacific Group has established AP-CHEMS, an integrated
chemical substance management system, to safely manage all
chemicals used in our production processes. Material Safety
Data Sheets (MSDS) for chemicals are managed in an integrated
manner through the AP-CHEMS system. We established a
database of all the different types of materials (raw materials,
reagents, MRO, etc.) with the information on substances subject
to work analysis, controlled substances, hazardous substances,and substances subject to special inspections, with regards
to occupational safey and health. Through this database, we
conduce systematic health management activities. In addition,
we are conducting regulatory review and establishing a databasefor new chemicals.

Management of Air and Soil Pollutants

Amorepacific Group is responding to various issues
around the workplace, including matters related
to water resources, wastewater, air pollutants,
chemicals, wastes, and biodiversity, to minimize
the environmental impact of the production site
operations. We strive to become a safer and cleaner
company in the production sites and surrounding
ecosystem through proactive measures, such as
managing with enhanced standards beyond legal
requirements and reusing rainwater within the
production facility.

periodically measured in consultation with external experts.
Measurement results are reported to the Subcommitteeof Environment, which is attended by company-wide
environmental personnel, and monitored regularly.

Amorepacific Group monitors the emission status and conducts
regular facility inspections to manage and reduce air pollutants
efficiently. Amore Beauty Park, in particular, obtained theMinistry of Environment’s integrated environmental permit
for the first time in the beauty industry in 2021, and manages
facilities for each category of environmental pollutant emission
such as air, soil, and water by integrating the permits. Air
pollutant discharge is prevented by automatically controllingthe damper of the local exhaust system within the air emission
facility through the control of the fan inverter in the air pollution
prevention facility. Also, a system for monitoring the operationof the air pollution prevention facility is established to control
the operation status of the facility in real-time. As a result, air
pollutants are discharged at a level that is about 20% lower
than the legal emission allowance. In addition, to preserve
soil environment, soil contamination near the workplace isblowing method to the horizontal vortex generation stirring
method to implement efficient treatment of pollutants. We
manage the wastewater discharge processes that are subject toenvironmental impact assessment, by registering them in the
major environmental impact registration system.

Water Resource Management
Amorepacific Group has established the 3R principles of ‘Reduce’
to improve the efficiency of water use, ‘Recycle’ to expand
water recycling, and ‘Reuse’ to expand water reuse, for efficientmanagement of water resources. In particular, the in-housestandards for the management of water pollutants are managed
at a level that is about 30% stricter than legal acceptancestandards. Wastewater treatment is managed based onstrengthened internal standards, which includes measuring not
only specific water hazardous substances such as copper, lead,and mercury, but also other potential substances of concern.
Rainwater is collected and used as recycled water through3,000-ton storage facility, and in 2022, the use of recycledwater was expanded to include landscaping, car wash services,cooling water for refrigeration units, and air conditioning. We
also established an infrastructure to reuse the final treated water
as landscaping water, reducing water usage and finding its
additional uses. We have established a system to monitor water
withdrawal automatically in Amore Beauty Park, and installeda groundwater pump inverter to reduce groundwater usagein OSULLOC Farm, so that groundwater could be withdrawn
efficiently according to the weather forecast. Also, we are in theprocess of designing and constructing a rainwater usage system(Siphonic roof drainage) in the new OSULLOC farm in Jeju.

Wastewater Management
Amorepacific Group has implemented a monitoring systemthat allows centralized control of all processes for thoroughmanagement of wastewater. Real-time measurements of Total
Organic Carbon (TOC) are being monitored. In addition, theunderwater stirring method was changed from the existing air

Conservation of Biodiversity
Preserving biodiversity is closely tied to the company’s business,
as a significant portion of Amorepacific’s raw materials comesfrom plant resources. We established a separate strategy touse biological resources and preserve biodiversity in a moresustainable way, and in 2022, invested about 2.32 billion KRW in
biodiversity conservation and their sustainable use. Amorepacificreviews and reflects international standards such as those set
by the International Union for Conservation of Nature (IUCN) in
its raw material management system to examine whether the
new raw materials violate the standards, before selecting them
to be used. We are also actively building a biodiversity research
network. We are conducting joint research with National
Institute of Biological Resources and Baekdudaegan National
Arboretum to find the hidden value of indigenous plant resourceson the Korean Peninsula. Furthermore, we are continuously
carrying out biodiversity preservation activities to protect theenvironment in the vicinity of the production sites. A leading
example is our participation in the improvement of Osancheon
Ecological Stream in Osan, Gyeonggi-do, where Amore Beauty
Park is located, since 2016. As a result of environmental recovery
activities, such as creation of a wetland ecological garden, andinstallation of ecological education facilities, the water qualityof Osancheon Stream, which had deteriorated to level 5 (verybad), was improved to level 2 (good), and even otters, a firstclass endangered wildlife, have been discovered in Osancheon
Stream.

41

Compliance with Environmental Regulations
Amorepacific strives to prevent environmental regulations
violation throughout its business activities and conducts
environmental regulation compliance diagnoses production
sites. All facilities, such as Amore Beauty Park and Daily Beauty
production site, are diagnosing compliance with environmental
regulations in all areas including air, water quality, waste, andchemical substances. The responsible department periodicallychecks major environmental law and regulatory amendments,
including domestic law, international law, international
agreements, and regulations, for management and shares
them with related departments. In addition, we review licenses
and standards accord ing to the revision of the law and makechanges if necessary.

Waste Management
Amorepacific Group is carrying out more efficient recycling
for each business site by dividing the waste generated in a
detailed manner, into different substances and types. We
developed our own environmental operation index in orderto manage our targets set for reducing waste emissions andmanaging recycling rates. To increase the actual recycling
rate, we continue to identify excellent recycling companies andconduct on-site inspections of our waste disposal companies.
In addition, through the production and transmission ofvarious campaign videos, we are educating employees onproper separation, discharge, and waste reduction activities.
Regular training is conducted not only for employees but also
for related suppliers to raise awareness on how to classify
waste properly and manage waste warehouses.

Achieved Zero Waste-to-Landfill from Production
Sites
As part of Amorepacific’s third promise in ‘2030 A MORE
Beautiful Promise,’ the company achieved its mid- to long-termgoal of ‘Zero-Waste-to-landfill generated at global production
sites by 2030’ ahead of time in the first half of 2023. In 2021,
about 97% out of a total of 3,096 tons of waste generated
from Osan Beauty Park was recycled, and the remainder was
disposed of by incineration and direct reclamation. In 2021, we
found a way to successfully recycle 3.5 tons of dust from dust
collectors, which was one type of waste sent off to landfill, andso from 2022, we managed to achieve zero-waste-to-landfill at
all our production sites at home and abroad.
Furthermore, following Osan Amore Beauty Park, bothDaejeon Daily Beauty production site and COSVISON
production site have obtained an international verification of
Zero-Waste-to-Landfill (ZWTL). The Zero-Waste-to-Landfill
Verification evaluates the recycling level of waste generated ata business site and grades it according to the rate of recycling.
Amore Beauty Park achieved over 94% circular resource
utilization, becoming the first in the beauty industry toobtain the silver level certification from ZWTL internationalverification, in March 2022. Waste generated at Amore
Beauty Park is transferred to a 543㎡ waste recycling center,classified into 21 types, and recycled by 12 resource circulation
methods. Since 2021, more than half of the dust waste, which
was previously sent off to the landfill, has been recycled as amaterial for basic construction of road works such as asphalt.
In addition, in the first half of 2023, Daejeon Daily Beauty
production site and COSVISON production site received thePlatinum rating, the highest rating available, in recognition
for 100% recycling rate without incinerating or reclaiming thegenerated waste. As we achieved our goal of direct reclamationahead of time, we are developing plans to further advancewaste management, and are implementing the recycling ofpreviously non-recycled, reclaimed waste.

Amore Beauty Park Acquires the Zero-Waste–to-Landfill International Verification

42[Case] GREENCYCLE Campaign

GREENCYCLE Campaign with Customers andEmployees
Through GREENCYCLE campaign, Amorepacific Group collects
used, empty cosmetic bottles from stores to recycle them, as
well as upcycle them into building materials, benches, andartworks. In particular, Amore Store, located in Amorepacificheadquarters, operates empty bottle collection program on an
ongoing basis to raise employees’ environmental awarenessand encourage voluntary participation in environmental
management. About 120 tons of empty bottles were collected
in 2022, and a cumulative 2,473 tons of empty bottles havebeen collected as a result of the empty bottle collection
activities since 2009. Amorepacific Group promises to takethe lead in solving the plastic problem through systematic
recycling of plastic bottles.

Environmental Campaigns with the Participation of
Employees
Carbon Empathy Campaign

Signing of an Agreement on the Use of Recycled
Materials from Empty Cosmetic Bottles
In April 2022, we signed an MOU with Hyundai Engineering &Construction for the use of materials generated from recycling
empty plastic cosmetic bottles. Accordingly, Amorepacificwill provide active cooperation to recycle our empty cosmetic
bottles and use the recycled materials for construction
materials and design development. The empty plastic bottles
will be shredded and combined with ultra-high performance
concrete (UHPC), to be reborn into construction terrazo tiles,
to be used in apartment compounds and landscaping facilities.

to stay longer with consumers by creating infinite use of our
products. We converted our used, and thrown away glass
cosmetic containers, which were previously utilized as a plastic
substitute, into objects with infinite purpose. Amorepacificplaces high emphasis on zero waste solutions that increase
product recyclability, and promote reuse, not only during
production process but also during disposal through methods
such as recreating waste glass bottles into works of art. As
a result, we aim to convey the essence and new value ofenvironmental packaging materials to society.

Usage of Plastic Packaging1)
Category

Unit Plastic
packagingmaterials%

6.6

2022 Goal%

5.0

Total weightTon

12,6402022 Goal

Ton

12,000Percentage of recycled

Percentage out of total

content within plastic

plastic packaging by weightpackaging2)

Total weight of plastic
packaging1)	The weight of packaging materials is aggregated based on the Extended
Producer Responsibility (EPR) for 2022
2)	The percentage of recycled content within plastic packaging materials is
calculated including the recycled plastic purchased from outside

Upcycled Tea House

Recreated Empty Bottles – Upcycled Objet
The Creative Partners (CP) program is run by Amorepacific’s
Creative Center for its members. The program let’s themembers propose and implement a variety of new businessrelated ideas for collaboration. In 2022, a member’s idea of‘Upcycled Objet’ was embodied and developed into a realproject. Amorepacific worked on this project with artist Park
Sun-min, a glass craft artist, to solve the one-off empty glass
bottle resources that have been used. We thought up of ways

Upcycled Objet

Through an idea contest, we received suggestions fromour employees on how to save energy and resources in ourdaily life. As one of the suggested campaigns, we carried out‘Digital Carbon Diet’ campaign, which involved measures
such as turning off unused digital devices, and we encouraged
voluntary actions from employees to protect the environment.
Zero-Food Waste Campaign
We conducted a campaign to reduce food waste at each of ourbusiness site. Specifically, we motivated employees not to leave
food waste through the Zero-Food Waste Campaign, where
we presented stickers to the employee when they showed up
with clean food tray at the exit after eating at the canteen. As
a result, COSVISION and Daily Beauty production sites reduced
the generation of food waste by 35% on average compared tothe same month from the year before.

43

Social2022 Performance

Utilization of Sustainably Sourced Palm Oil(RSPO Certified Palm Oil)

Achieved 53.6%

Operation of ‘Low-interest Loan Funds’ for Suppliers

25.3 Billion KRW

Total Expenditure for CSR Activities

17.4 Billion KRW

44Creating a Positive
Work Environment

Supporting Employees’ Growth[Case] Job Competency Enhancement
Training

Training to Strengthen Employees’ Job Competency
We operate a job academy that reflects the needs of markets,
organizations, and learners at all times so that all employees ofAmorepacific Group can perform their tasks and make decisions
based on sound expertise. In the case of marketing, we provided
support for strengthening customized branding capabilities, andit included contents to develop brand identity and story, to foster
marketers who lead brand-oriented management. In the caseof sales, we focused on strengthening platform sales capabilities
taking into account the increased proportion and importanceof e-commerce channel sales. With regard to the concept ofbeauty, through education on the knowledge and skills in eacharea necessary for employees’ performance, we help to cultivate
the value of beauty as members of a beauty company anddeliver it to customers. Through this, we have enhanced ourexpertise in beauty and strengthened our capabilities in productdevelopment and research.

Leader Competency Enhancement Training
Beauty Academy
We operate specialized beauty learning courses tailored todifferent business areas in product research, development,
and sales to equip our beauty company’s members with thenecessary knowledge and skills. The Academy provides basic
courses on subjects such as fragrance, skin care, and makeup,
and also provides courses for beauty-related professional
licenses. Through these programs, we can cultivate the value ofbeauty among our beauty company’s members from a businessperspective, and gain the advantage of fostering beauty experts
in each business area. We can also expect sales to increase
through specialized beauty knowledge and skill-based customer
response.

Operating Diverse Learning Platforms

Amorepacific Group strives to provide its memberswith a happy working environment based on trust
and respect in the workplace. We hire talented people
with various backgrounds from different countries
without discrimination, and provide customized
education according to the position system to help
develop members’ capabilities. We take measures
to provide fair evaluation and compensation basedon performance and increase members’ satisfaction
through customized welfare support for work-lifebalance.

In addition to job-specific training, we provided diverse
learning platforms to enhance employees’ ability to expand
their experiences and critical thinking through interactions
with peers. Examples include ‘KNO.C.K (Knowledge for
Coworkers)’ program, ‘Study Group’ a group learning activity
conducted through cooperative interaction between employees,
and ‘Jiphyeondang’ and ‘Book Club,’ book culture program
to promote expanded thinking. Amorepacific Group plans
to continue providing support with various learning styles
and methods so that our employees can gain their own
competitiveness in the market as well as in the business.
The effectiveness of the curriculum is measured periodically
based on indicators such as member satisfaction and content
comprehension, and the effectiveness of the training courses inpractical application within the company is verified based on thir
relevance to work.

Number of Beauty License Holders (Compared to 2021)

Increased by

154%

Employee Participation Rate (Based on all employees, as of 2022)

14%

Amorepacific Group has established a leadership competency
system to strengthen the competencies of the leaders. We
run various programs in relation to job roles and leadership
perspectives for leader candidates and existing leaders based on
the leadership pipelines. For leaders ranging from team leaders
to executives, we are focusing on providing content-centerededucation programs [AP Sikam (Amorepacific Knowledge andSense), Leaders Forum, etc.] that enable them to develop job
insights, and on leadership coaching courses where they receive
support on providing coaching and feedback as a leader.
We also conduct leadership diagnostics once a year forcompany leaders. We diagnose leadership capabilities througha leadership coaching center with the help of in-house coaches
and then run feedback sessions with the leaders. In particular,
new leader candidates are provided with separate organizational
feedback for onboarding, discussing ways to create synergy
between subordinate leaders and their individual leadershipstyles, and providing 1:1 coaching and in-house mentoring if
necessary. For more than 200 leader candidates at home andabroad, we run a process to enable them to understand anddevelop leadership proactively.
Furthermore, a discussion-style curriculum is run to help leaders
understand customer-centric perspectives and brand-centricmanagement, to enhance their understanding of the schemeand strategy and to discuss effective ways to achieve the goals.
Semiannual discussion programs are operated to strengthen
discussion skills between managers and C-Levels. In addition,
we focus on enhancing leaders’ job expertise by identifying thecompetencies essential to achieving the strategy every year andrunning the ‘The School’ course. In 2022, we shared in-depth
concerns about brand-specific growth and rebranding strategies
through the ‘Marketing School’.

45

Digital Capability Enhancement Training
In the context of the company’s digital transformation,
recognizing the need for digital competencies across all job
functions, we are continuously providing learning opportunities
on digital-related topics, tools, and methodologies.
Especially in the marketing function, we developed andimplemented a creative evalutation and content marketing
program to enhance digital competencies, focusing on digitalcontent planning and utiliziation. In the sales department,
we expanded e-commerce-specific education to include
understanding of domestic and international e-commerce
platforms, and enhancement of platform merchandisingnegotiation skills.
As digital communication with customers continues to rise, theneed for development and creation of various digital forms ofcontent is growing. Accordingly, in addition to strengthening
digital capabilities of all our employees, we developed andoperated a training course so that our members could switch
to digital-related jobs regardless of their previous roles. During
this process, we provided support for practical competencies
related to digital content creation, leading to 89% of learners
being able to perform digital job tasks. Amorepacific Groupplans to continue expanding education for transitioning into
digital roles in the future.

From the perspective of enhancing overall digital capabilities
within the organization, we are providing support to establish
the direction for digital learning through fundamental
education, including IT basics and digital literacy training.
Additionally, we continually update various topics such as
Google Analytics, YouTube, AI, and more to ensure our overall
digital capabilities.
We added ‘digital insights’ to leadership empowerment
training in order to raise awareness and strengthen
capabilities indigital utilization and data literacy. Additionally,
we conducted digital sessions targeting all executives, toprovide understanding and hands-on experience in areas likemetaverse, collaboration tools, e-commerce, and social media
platforms.

[Case] Digital Capability Enhancement
Training

AP+ E-Commerce Academy
AP+ e-commerce academy was designed to enhance theexpertise of Amorepacific Group’s e-commerce professionals
and enable all employees to develop insights into e-commercemarkets and platforms. In 2022, 10% of the entire employees
participated in the academy. The training program covers avariety of e-commerce-related topics, including e-commerce
sales management, negotiation, the establishment of productstrategy, data services, and the use of external mall dashboards.
We expect that this training will help to increase sales andprofits by upgrading activities for each e-commerce platform,
fostering online platform sales experts, and diversifying
global e-commerce platforms from a business perspective. As
e-commerce sales for 2022 increased by about 30% YoY, theAP+ e-commerce academy has proven itseffectiveness.

Operating a Fair Performance Appraisal System
Amorepacific Group adopted a new personnel system tocreate a culture that can help improve performance and focus
on capability development based on feedback. Accordingly,
the Group conducts regular performance appraisals once a
year and conducts ongoing task evaluations. In 2022, wemanaged the system in a variety of ways to ensure that it wasestablished successfully. The results for the first year of thesystem operation and employee surveys were analyzed toderive improvement points, and they were made into videos
and shared with employees to increase interest in the effectof continuous feedback. In addition, we generated highquality feedback compared to the past by sharing companywide posts and separate letters containing review highlights
for each position (leaders, employees). After selecting the bestorganization for continuous performance management, we
introduce it to the entire company as a best practice so that the
feedback culture can be embodied naturally.

Types of Individual Performance Appraisals for
Amorepacific Employees(%)

Category

Rate1)

Rate of Goal Setting

99.5

Rate of Multi-Source Assessment

72.1

Comparative Analysis between

45.6

Same-level Positions

1) Calculated based on separate domestic data for Amorepacific46

Creating a Culture of Mutual Trust andRespect among Employees
Expanding Daily Work Experiences Related to ABC
SpiritIn order to internalize ABC Spirit, Amorepacific Group’s way
of working, we provide various experience opportunities toour employees. We run a series of campaigns that embracecompany value regularly and repeatedly in our work routines,
creating a personalized principle experience for our employees.
In addition, we launched a community under 32 themes
enabling employees to form diverse and new networks. Thishas created opportunities for employees to gather freely,communicate and empathize with each other, expanding
the foundation for collaboration. Moreover, through theimplementation of a system to encourage employees topraise colleagues who put the principles into practice, we are
creating a culture of finding and sharing the practice cases of
ABC Spirit at all times. The ABC Spirit internalization programis being developed through an employee-driven approach,where employees voluntarily participate and take the lead in
its implementation.

Strengthening Global Consensus on ABC Spirit
To support the practice of ABC Spirit among AmorepacificGroup employees around the world, we seek and apply
appropriate methods for each country. In 2022, three Culture
Sessions were held, providing a regular communication
platform to share the current status of organizational cultures
across global subsidiaries and to discuss ways to implementchange management. Global subsidiaries are strengthening
consensus on ABC Spirit by operating their own localorganizational culture programs or selecting and operating
contents and methods suitable for their subsidiary among theheadquarters programs, according to the situation of eachsubsidiary. In the future, we plan to take additional measures,such as hosting organizational culture forums led by the headof subsidiaries, so that members of global subsidiaries canpractice our ways of working more intensively.

[Case] Employee Communication Channel
Amorepacific Group is expanding mutual communication in various ways to create a culture of trust and respect regardless of ranks ororganizational levels.

Redesigning Engagement Survey
In order to build a culture where employees are engaged andwork in a positive environment, the Engagement Survey model
has been redesigned. The revised survey model reflects thework values and engagement trends of the MZ generation,
who accounts for nearly 80% of Amorepacific employees. The
Engagement Survey is conducted for employees who haveworked for more than two months in any of Amorepacific’s
global subsidiaries. This year, we achieved a response rate of
78.9% for the survey. The survey results are utilized with adata-driven approach to understand and make decisions about
the organization’s state, aiming to create a great workplace.
Alongside the company-wide report, we issue detailed reports
for each department, encouraging comprehensive efforts
to improve engagement. Additionally, we plan to conduct
Culture Session for leaders to deeply understand the results
and contemplate changes in our working methods. This year,
we are strengthening the analysis of the diagnostic results toprovide valuable insights and additional organizational culture
development programs that will aid in improving the overall
culture.

Results of the 2019-2022 Regular Engagement Survey(%)
Category

2019

2020

2021

20221)

Amorepacific Group

45.5

43.1

45.5

45.3

Amorepacific

41.5

37.5

39.0

40.6

1) Due to the change in internal management cycle, the assessment took placein the first half of 2023

Amore Blooming

Town Hall Meeting‘Amore Blooming’ is an in-house online live broadcast aired
every month with a report from employees, contributing
to smooth communication between the organization andemployees. Employees select the executives they want tomeet in the following month’s broadcast, conduct real-time
Q&A through reply participation, or conduct an instant survey
to incorporate employees’ opinions regarding company
management. By expanding the opportunities for employees
to participate, Amore Blooming has established itself as arepresentative in-house interactive communication channel.

During the annual all-employee participatory session,
Team Amore Conference’ in July 2022, the first town hallmeeting was held to create a culture of free and transparent
communication. With all employees participating online oroffline, the management responded directly to the employees’questions and it received a great response. Since then,workshops were conducted sequentially for each brand, sales
and other organizational units. By regularizing town hallmeetings to share business status and plans and provide quick
feedback on employees’ opinions, we are strengthening thevision of common objectives and sense of belonging with theorganization.

NewsSquare
Amorepacific Group’s main content platform ‘NewsSquare’
presents planned contents throughout the year, such as
the ‘A! PEOPLE’ series, which presents the philosophy andleadership of each organization’s management, and the ‘AP
LOG IN&OUT’ series, which introduces employees who excel
in vaious roles. On this platform, noteworthy company news
is constantly shared. Through this, we are fostering a cultureof mutual respect and understanding across ranks, roles, anddepartments.

47

Establishing a Win-Win Labor-Management
Relationship

Employee Wellbeing

For the past 30 years, Amorepacific has maintained a disputefree workplace, and developed stable labor-management
relations. Amorepacific and all of its subsidiaries comply withlabor laws and conduct voluntary self-inspection of working
conditions at least once a year. As of the end of 2022, there
were 2,006 Amorepacific labor union members, with 67.5% ofeligible employees (2,974 employees) actively participating in
the labor union.

Strengthening Support for Maternal Protection

Employees of Amorepacific are free to join and leave the labor
union at their own will. Collective agreements that apply to
all employees are signed every other year. The Labor Council
holds meetings each quarter, and this serves as a forum to
discuss employee welfare enhancement, grievance handling,and safety management, among other significant laborrelated issues. In addition, various ad-hoc communication
channels such as management briefings, business plansharing, and union member meetings are operated to facilitatecommunication and engagement. Amorepacific’s labormanagement cooperation team and human resources teamare checking and supporting the establishment of a win-win
and cooperative labor-management relationship.

Amorepacific ensure the health and safety of pregnant
female employees by complying with legal requirements
such as shortening working hours, adjusting commute times,
allowing time for prenatal check-ups, and prohibiting overtime
work to create a conducive and safe working environment.
Furthermore, we operate a system that guarantees areasonable level of monthly salary when employees do notwork due to maternity leave and parental leave. If the subsidy
provided by public agency is less than the monthly salary
for the last 30 days of maternity leave, which is an unpaid
period under the law, the monthly salary is compensated bypaying the difference. In addition, 60% of the normal wageis provided for the subsequent 90-day parental leave takenright after maternity leave, and the same is provided for up to
90 days even if parental leave is used during pregnancy. We
enable employees who are on miscarriage or stillbirth leave
to obtain enough rest and return to work by allowing themto take up to 10 days of leave, even if the pregnancy period
up to miscarriage was less than 11 weeks. Furthermore, we
encourage parents of newborns to take advantage of parental
leave and operate on-site daycare centers at Amorepacificheadquarters, Amore Beauty Park, and R&I Center.

Health and Welfare Promotion System
Category

Contents

Workplace Stress Management· AP-Severance Clinic: Stress assessment through autonomous nervous system examination andmental health-care clinic· Happy Life Consulting: Psychological counseling services operated both through offline meetings,
or calls

Healthy Working Environment· Management of lighting, noise, air quality, humidity, and temperature to create an ergonomic
working environment

Sport & Health Initiatives· Operation of in-house fitness centers and healing facilities

Supporting Employees’ Health· AP-Severance Clinic· General medical consultations, obstetrics and gynecology consultations, and otolaryngology (ENT)
consultations· Vaccination, nutrition counseling, and physiotherapy and manipulative therapy facilities formusculoskeletal treatments· Post-examination care service for employees with potential health risks, through AP-Severance
Clinic and local healthcare institutions (participation rate of employees with potential health risks
in the post-examination care service: 30.8%)

Flexible Working Hours· A system in which working hours are selected autonomously by individual employees within an
average of eight hours a day on a monthly basis

Working-from-home arrangements· To ensure the safety of our employees during the COVID-19 pandemic, remote work was
introduced as part of our smart work initiative. This new work system is implemented considering
the specific work characteristics and work environment of each department

Part-time Working Options· Part-time working options provided for family care, personal health issues, preparation for
retirement, and studies (15-30 hours per week)

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

48

Human Rights
Management

Human Rights Management
Human Rights Policy
As a global corporate citizen, Amorepacific Group supports andcomplies with the human rights requirements specified in the
United Nations Global Compact(UNGC), Universal Declarationof Human Rights, and the recommendations of the National
Human Rights Commission. Through human rights policies,
we ensure that the human rights of various stakeholders, suchas employees, customers, local communities and suppliers, arerespected throughout the Group’s management activities, andstrive to prevent acts of collusion or facilitation of human rights
abuses. In addition, Supplier Sustainability Guidelines specify
what suppliers must comply with in order to prevent humanrights violations.
Statement of Human Rights Policy

Human Rights Training for Employees
We internally train all of our employees on preventing sexual
harassment at workplace and improving understanding of
disabilities. Through such human rights trainings, we thrive toprevent sexual harassment at the workplace, spread the valueof coexistence, and improve perceptions regarding disabled coworkers. Regular online trainings were conducted in 2022, andadditional trainings were provided for the new employees andthose who did not receive training.

As a company committed to global citizenship,
Amorepacific Group respects the fundamental
rights of all stakeholders. By issuing a humanrights policy statement, we indicated AmorepacificGroup’s commitment to human rights management.
Accordingly, we strive to minimize human rights risks
in business operations through human rights due
diligence every year.

Human Rights Grievance Channel
Amorepacific Group operates an Ethics Hotline channel in
Korean, English, and Chinese, where any unethical behaviors
or violation of human rights can be reported. Informants
may report confidentially or anonymously, and are protectedfrom unjustified retaliation. External stakeholders also haveaccess to the grievance channels, and the information is also

provided in the Supplier Sustainability Guidelines in order toincrease awareness. The reports received are handled withtransparency and are continuously monitored to prevent
recurrence of human rights violations.

Amorepacific Group Human Rights due diligence
Process
Identify Human Rights Risks

Human Rights Due Diligence
Amorepacific Group has established a systematic humanrights management system to prevent possible humanrights violations during the business process. We conduct
a regular human rights due diligence process once a year
to identify human rights risks in business operations andprevent potential violations. In order to identify the humanrights issues that may arise throughout the value chain, suchas forced labor, human trafficking, child labor, freedom of
association, qualification for collective bargaining, equalpay, discrimination, and consumers’ human rights, as well as
environmental rights of the local community, we take into
consideration of the past human rights issues, their occurence
frequency, severity, and other relevant factors comprehensively.
In addition, through the human rights due diligence process,we check vulnerable areas intensively for each stakeholder
category such as employees, customers, local communities,
and suppliers, considering the business characteristics andlocal laws for each subsidiary. The identified vulnerable areas
are improved through specific corrective actions, and relevant
personnel in the field and external experts are deployed tosupport the implementation of remedial actions. The humanrights due diligence in 2022 was conducted through written
surveys (in Korean and English) and pre-planned on-site due
diligence. As a result of the due diligence, one issue related tosexual/work harassment at workplace was identified throughthe reporting channel, so corrective action was taken. For
other major issues that were considered to have potential risks,a risk management task list tailored to the topic of the issue
had been established and delivered to the business site.

· Produce a checklist based on the Universal Declarationof Human Rights, International Labor Organization
ILO Standards, labor-related laws, the Group’s humanrights policies, and Supplier Sustainability Guidelines.
· Taking into consideration of business characteristics
and local laws for each subsidiary

Assess Human Rights Risks· Conduct evaluation targeting employees, suppliers, andcustomers, etc.
· Check compliance with Sustainability Guidelines andassess vulnerabilities

Conduct Human Rights due diligence· Self-inspection and on-site inspection

Corrective Actions and Management· Request and monitor corrective actions· Provide the support of collaborators and external
experts

49

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

Task

Description of Issue

Corrective Measures Taken

Employees

Forced Labor

Self-inspection ofhuman rights

Comprehensive examination of labor and human rights issues, including compliance · Provided labor-related education and training
to the Labor Standards Act, wage, and non-discrimination principles

11 subsidiaries, including
Amorepacific

Employee health management

Promotion of employees’ healthManagement of Employees’ Stress and Mental HealthAll business sites· Operated the ‘Employee Wellness Program’ to support continuous healthcare through step-by-step exercise/meditation
programs

Number of Business Sites that
Implemented Tasks· Implemented EAP (Employee Assistance Program) ‘Happy Life Consulting’ to address and provide support for psychologicalissues related to individual stress (support for personal/family counseling)· Operated ‘Mindfulness Program’ aimed at changing perception through awareness of one’s inner self
· Operated ‘ME-UP Program’ to enhance intrinsic motivation, understanding strengths, and resilience capabilities

Customers

Freedom of Association/Collective
Bargaining

Collective bargaining

Collective agreement to be reached when a labor union is formed, in accordancewith labor-related laws

· Concluded collective agreements and implemented the agreements biennially in accordance with labor-related laws andlabor union agreements

All business sites

Employee protection fromworkplace harassments

Prevention of sexual harassments
or bullying at workplace

Prevention of any unethical treatments on the employees, including physical/
verbal/sexual harassment or abuse at workplace· Provided trainings on prevention of sexual harassments, improving understanding of disabilities.

All business sites

Elimination of Discrimination in
Employment and Work

Need to improve employee
awareness on diversity andinclusion

Need to improve employee awareness on diversity and inclusion· Operated an in-house program for the improvement of awareness on diversity&inclusion (a total of 825 employees
participated)

AmorepacificProtecting Consumers/Human
RightsResolving consumer disputes

Consumer complaint handling· Conducted real-time consultation and Q&A for consumers through integrated quality VOC response service (about productside effects, inconvenience in use, etc.); managed the VOC system and DB, analysed customer complains; collected andinspected the problematic items

All business sites

Customer privacy protection

Prevention of customer harms· Conducted 98 sessions of security reviews when building the new information system

All business sites· Operated hotline for reporting workplace harassments (one case closed)· Carried out security diagnosis and improvement of 115 personal information outsourcing partner companies· Completed regulatory compliance check and safety inspection of 61 personal information processing systems· Conducted 156 mock hacking and improvement tests
Local
Communities

Obligation to Protect
Environmental Rights

Osancheon Ecological Stream
Development ProjectProtecting the environment in Osan city, where our production site is located· Carried out a project to improveOsancheon Ecological Stream

Amore Beauty Park

Suppliers

Palm Oil Production and Supply

Procurement of sustainable

Prevention of damage to communities and indigenous groups within the supply
chain due to uncontrolled palm oil harvesting· Expanded the conversion regular palm oil into RSPO-certified palm oil

Amorepacific

Assessment of the labor status of suppliers· Requested suppliers to establish improvement plans for employee grievance handling systems

16 suppliers

palm oil (RSPO)
Responsible Supply Chain
Management

Assessment of suppliers’
sustainability

50

Enhancing Diversity and Inclusion

Amorepacific Group’s Diversity and Inclusion Policy
1. Respecting Employee Diversity

Diversity and Inclusion Policy
Amorepacific Group respects the value of diversity andinclusion, and aims to nurture a culture in which employees
from different backgrounds can exchange thoughts andgrow in a free environment. To this end, we have establisheda diversity and inclusion policy, internally building anorganizational culture with a high level of diversity andinclusion, while externally conducting communication activities
such as inclusive marketing taking diversity into consideration.

Every unique characteristic of Amorepacific employee deserves
to be respected, and these individual differences must be
mutually recognized and respected.
2. Zero Tolerance for Discrimination
We prohibit discrimination of any kind on the groundsof 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, or promotion,
as well as any discriminatory behavior against legally protectedminorities.
3. Providing Employees with Opportunities for Participation
Our employees can freely voice their opinions on diversity andinclusion, and we encourage them to collaborate in diverse
and inclusive ways.
4. Inclusive Marketing
We promote the value of diverse and inclusive beauty inproduct development and marketing communication.

Activities for Internalization of Diversity andInclusion

Win-Win Collaboration with ‘KIMU STUDIO,’ a Social Venture
for People with Developmental Disabilities

Amorepacific Group conducts various programs to promote
the value of diversity and inclusion. Amorepacific plans
to implement participation programs for domestic andinternational employees and stakeholders by 2030 to fulfill
Promise 2 of ‘2030 A MORE Beautiful Promise,’ “Promote
diversity and inclusion across all our global workplaces andbeyond, while looking for harmonious growth with our
stakeholders”.

Amorepacific has formed a partnership on employment
opportunities for the disabled with ‘KIMU STUDIO,’ a social
venture that fosters designers with developmental disabilities
and presents their works to society. This partnership strives tofind talented designers with developmental disabilities, andsupport their social integraion, demonstrating its commitment
to empathizing with and supporting socialy vulnerable
individuals. In 2022, we collaborated with designers with
developmental disabilities to launch picnic mats featuring theirillustrations as part of our packaging.

Diversity Education and Programs for Employees
Under the diversity and inclusion policy, Amorepacific Group
conducted a test to measure employees’ diversity sensitivity,and created in-house newsletters and educational programs
to increase their sensitivity. A total 11.6% of all employees ofAmorepacific Group participated in the program. Throughthis process, employees realized the meaning of unconscious
prejudice and respect for diversity, and shared in-depth
discussions to move toward an inclusive organizational culture.
Amorepacific Group plans to continually conduct various typesof employee participation programs related to diversity andinclusion, such as in-house employee awareness assessment,
insightful lectures, and workshops, for all employees ofAmorepacific Group, including overseas subsidiaries.

Amorepacific Group’s Diversity&Inclusion In-House Newsletter ‐ Divercity

Amorepacific × KIMU STUDIO Collaboration Picnic Mat

51

Safety and Health

Safety and Health Management System

Operation of the Safety and Health Implementation
Organization

Compliance with Safety and Health Management
PolicyThe safety and health management policy is approved by
the Board of Directors, the chief decision-making body,and policies and plans related to safety and health are also
reviewed and approved annually by the Board. The Safety
and Health Management Committee operates as a decisionmaking body to prevent company-wide safety accidents. This
Committee, composed of President and Persons in generalcharge of health and safety, reviews major internal andexternal health and safety issues and verifies compliance withsafety and health laws and regulations semi-annually.

The Safety and Health Management Policy was established as
the top priority to secure safety and health for all stakeholders,
including employees and contractors, under Amorepacific’s
management and supervision. A safety and healthmanagement system has been established to put the policy
into practice.

Safety and Health Management Policy· Ensuring safety is the number one principle we are committed
to protect in all our business activities.

To achieve the company’s disaster-free goals by
2030, Amorepacific conducts a number of activities
to proactively derive the source of risk and address
harmful or dangerous factors at its business sites. In
order to respond to SHESafety, Health, Environment risks andregulations, we adopted cutting-edge management
standards and established an audit system to monitor
and evaluate performance continuously. Additionally,
we are strengthening our safety and health capabilities
and safety management system by fostering in-housesafety and health experts and establishing a dedicatedsafety and health organization at each workplace.

· Amorepacific is dedicated to creating a safe work environment
to ensure the health and safety of all members.
· Amorepacific complies with all relevant occupational healthand safety laws as well as internal safety policies.
· Amorepacific provides continued training and education on
safety and health and all Amorepacific members shall actively
participate in activities ensuring a culture that prioritizes safety.
· Amorepacific shall regularly establish objectives and goals to
make continued improvement as well as implement reviews
and improvement measures.

The Safety and Health Center, which oversees the company’ssafety and health affairs, establishes a plan for safety andhealth and operates a monthly meeting to share safety
and health updates. The monthly safety and health sharing
meeting serves as a platform to discuss safety and healthissues, including the explanation of planned projects for each
workplace and listening to the workplace’s requests. It is
attended by the Satety and Health team leaders and officers
from each business site. Additionally, Occupational Safety and
Health Committee, council on safety and health, and online‘Safety Shinmungo’ reporting system are operated at each
workplace so that employees can submit safety and healthrelated complaints and request improvements directly. The
implementation of the improvements is transparently shared.

Organization Chart of Amorepacific
Safety and Health Management Committee
Safety and Health Management Committee
Safety and Health Center

Organizationin charge

Amorepacific

SCM

R&I

Non-manufacturing

BeautyHeadquarters

Daily Beauty

HR Development
Center

Logistics
Healthcare
OSULLOC
Production

R&I Center

Regional Offices
Directly
operated·frachise
storesSafety and Health Management System Certification
Amorepacific’s workplace operates a Safety and HealthManagement System in order to ensure a safe working
environment. Osan Amore Beauty Park, Daejeon Daily
Beauty production site, Shanghai Beauty production site,
and COSVISION have completed ISO45001 certification, a
global standard. Based on the Safety and Health Management
System, we establish periodic safety and health goals, measureperformance, and implement improvement activities.

52

Safety and Health Goals and Performance
Measurement

Safety and Health Activities

Amorepacific has established ‘2030 Disaster-Free’ as a midto long-term goal for safety and health management. Every
year, we set detailed implementation goals to achieve ‘zero
occurrence of major industrial accidents, major civil disasters(public facilities),’ and ‘achieving 100 poinits for Workplace
Safety and Health Operation Index.’ We have achieved Detailed
action plans have been developed to achieve the establishedgoals and to protect employees and stakeholders from serious
accidents. Furthermore, we are conducting various activities
such as education training, and campaigns to identify potential
dangerous factors for high-risk work that may occur in theworkplace and establish a safety culture.

SHE Audits and Compliance Diagnosis with
Regulations

Process for Measuring Safety and HealthPerformance
Monitor performance results compared to each business site’s goals(Quarterly)

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

Provide feedback on improvements based on the results ofperformance measurement

Implement improvement measures by each business site
(immediately)

Reflect management’s review items when setting safety and healthgoals for the next year

In order to respond effectively to SHE-related regulations
and risks in the expanding global market, Amorepacific has
established an advanced common management system at theGroup level. We continue to monitor, evaluate, and improve
SHE performance through self-audit of the business sites using
SHE Standard, cross-audit of the business sites, and third-party
audits through external specialized institutions.
In particular, in order to respond to the Serious Accident
Punishment Act, which took effect in 2022, we developed achecklist consisting of 713 items for 32 laws related to safety andhealth. Based on this, we conduct legal compliance inspections
once every six months for all workplaces and make necessary
improvements. Additionally, we are striving to create a safe
workplace by conducting field-oriented third-party diagnosis
through external specialized institutions, including precise
diagnosis of rules on industrial safety and health standards andinspection of fire prevention and firefighting facilities.

of fire protection facilities. Sprinklers were added to supplementin vulnerable areas, and to prevent fires, a ‘Cleaning Day’
was designated and implemented to remove combustibles
underground and indoors for all workplaces. Moreover, we haveestablished improvement measures by identifying risk factors
for collision at each section when operating forklifts in theworkplace and implementing improvement tasks.

Investigating Accidents and Preventing Recurrences
Amorepacific is investigating the direct and fundamental causes
of incidents and accidents at workplaces to prevent serious
accidents, and has established and implemented measures forpreventing recurrence. In addition, in the event of an accident,
an accident investigation team is formed to reconstruct theaccident scenario and take follow-up measures to prevent
similar accidents. To this end, Safety and Health officers at each
workplace have completed training in RCA (Root Casual Analysis)
investigation course through external specialized institutions.

Process for Accident Investigation and Recurrence
Prevention
Accident Occurrence

Deriving Harmful or Dangerous Factors at Workplaces
and Strengthening Improvement Activities
Amorepacific conducts on-site risk diagnosis in consultation
with external experts every year. In addition to document-based
safety management, we carry out various activities to eliminate
risk factors in the field.

Accident
ReportClassification of accident type, reporting:
Department of accident occurence → Safety
department → Headquarters

In 2022, we conducted a full investigation of pinch andconstriction hazards at our workplaces and strengthened
workplace safety management by completing 100% installationof interlock, protective covers, and safety sensors where
improvement is needed. In addition, we have strengthened
infrastructure and operational capabilities for vulnerable areas

Accident
Investigation

Formation of an accident investigation team andidentification of the cause of accident

Prevention of
Recurrence

Establishment of recurrence prevention measuresand completion of actions

Safety and Health IT Systems Advancement (AP-SHE
Portal)Amorepacific operates the ‘AP SHE Portal (Amorepacific Safety
and Health Environment Portal System),’ which facilitates
digitalization of workplace safety and health management withcross-platform compatibility for PCs and mobile devices. In 2022,
we completed the first phase of system advancement to include
management of appointed legal representatives, real-timestatistics and analysis of accident trends, customized dashboards
for each workplace, and an automated notification system fortraining and inspection dates. In the future, we will continue toupgrade, maintain, and repair health management systems andsafety work permission systems. Additionally, through mobile
app optimization, we aim to establish an effective management
system that allows real-time monitoring and improvement of
workplace safety status on-site.

Safety and Health Assessment for Contracting,Outsourcing, and Entrustment
Amorepacific came up with its own procedures and standards
for regularly evaluating the level of safety and health measuresthat are currently implemented by companies with whom
Amorepacific conducts businesses in the form of contracting,outsourcing, and entrustment. Contracting, outsourcing, andentrustment are divided into four types (office work business,
low-risk business, general risk and high-risk businesses, andconstruction companies) for management, and the company’ssafety and health level is evaluated at the contract stage. Safety
and health level grades are assigned according to the evaluation
score to select a suitable company with a certain grade or higher,
and we do not sign a contract with a company that does notmeet the criteria.

53

Supporting Contractors with Safety Management

Efforts to Create a Safety Culture

Development of Employee Health Promotion

Amorepacific continually makes efforts to establish healthy andsafe workplaces for its employees as well as its contractors.
Accordingly, safety and health diagnosis was conducted forinternal contractors, and guidance, advice, and education were
provided to ensure 100% improvements based on the findings
from the diagnosis.

Amorepacific is conducting various activities to foster a safety
culture within its business sites. In order to enhance safety
awareness and communication among all employees, weoperate Occupational Safety and Health Committee, Council on
Safety and Health, as well as our Safety Shinmungo reporting
system as communication channels. Additionally, we facilitatea platform for regular sharing of safety and health issues withsafety officers, allowing them to propose improvement ideas.

Since 2020, Amorepacific has been conducting an industryacademic cooperation initiative with Yonsei University toprevent musculoskeletal diseases and improve employees’
health, and continues to operate the musculoskeletal
management center. Through this, we investigate
musculoskeletal hazards regularly and conduct intensive
management programs and thorough evaluations ofmusculoskeletal diseases for those who experience pain,
wholeheartedly supporting a healthy working environment.

Conducting Safety and Health Education
Amorepacific is committed to preventing serious accidents at
workplaces and improving employees’ awareness of safety andhealth by providing mandatory legal education as well as safety
and health education related to hazardous and risky tasks, as
required by safety and health regulations.
In 2022, various training courses were established to train
safety and health professionals in the workplace, including
courses for obtaining national safety and health certificates.
Furthermore, we provide customized training for AmorepacificGroup’s supervisors, considering the specific characteristics ofthe cosmetic industry. Starting from the supervisor educationin 2023, cardiopulmonary resuscitation (CPR) training will be
designated as a compulsory program to support all supervisors
in strengthen their emergency response capabilities in the eventof an accident.

We actively encourage the implementation of Safety Moment(3-minute safety) before starting executive meetings andworks, and we produce and distribute safety and health videos.
Fifteen kinds of videos on various topics, including constriction,
emergency evacuation, ladder fall, forklift collision, and fire
prevention, have been produced and are broadcasted in all
workplace resting areas to heighten employees’ awarenessof safety. A total of 10 Safety Golden Rules have also been
established to prevent safety accidents that may occur at
Amorepacific business sites. We are making every effort topromote a high order safety culture and firmly establish a safe
workplace by stipulating principles that all employees must
adhere to.

Emergency Preparedness and Response Training
Amorepacific has established response meansures and relief
action plans for potential accidents and safety risks, andconducts the necessary emergency response training. During
the emergency response training, joint training was conductedwith local fire stations, and in the case of regional offices, alltenants in the building participated in the training. In addition,
to ensure that employees are equipped with emergency
response capabilities. We plan to train at least one trained
person per team and store as a certified First Aider, and we willconduct hands-on CPR training for all employees.

In the future, to prevent musculoskeletal diseases, we plan
to carry out a project to improve musculoskeletal burden incooperation with external experts. Furthermore, we strive to
identify harmful or dangerous factors at work that can burden
the musculoskeletal system, such as measuring and handlingraw materials, and create an environment that prioritizes
employees’ health. To achieve this we will derive ergonomic
workplace management methods and implement measuresfor prevention of occupational diseases.

54

Sustainable
Supply Chain

Enhance Sustainability of the Supply Chain
Selection and Management of Suppliers

Supplier Status

Supporting Suppliers to Strengthen Sustainability

Category

2020

2021

2022

Number of primary suppliers

379

339

347

Number of primary significant suppliers

49

49

45

Amorepacific Group selects significant suppliers consideringfactors such as the size of the transaction with us, thedevelopment and supply of essential packaging materials,
influence on its business, irreplaceability, and capabilities. Asof 2022, out of the total 347 suppliers, there are 45 significant
suppliers, including 21 packaging-related suppliers, 15 raw
material-related suppliers, and 9 ODMOriginal Development
Manufacturing suppliers. Amorepacific Group made purchases

worth about 586 billion KRW from its entire suppliers in 2022.

Number of secondary significant suppliers

16

16

16

Total purchasing amount (100 million KRW)

7,733

7,965

5,860

Purchasing amount from significant suppliers

3,212

5,011

4,087

75.4

75.3

70.2

(100 million KRW)
Rate of local purchasing at overseas business

Requirements for Compliance with the Suppliers’
Code of Conduct
Amorepacific Group has prepared a code of conduct for our
suppliers, ‘Guidelines for Sustainable Management of Partners,’
and has announced it on the Amorepacific Group website inthree languages (Korean, English, and Chinese). Through thesites (%)

Main Targets and Performance of Supplier
Sustainability Management
Category

KPI

2021

2022

2025
Goals

Number of
suppliers’ employees
participating in the
training program by2025

Number of
suppliers’ employees
participating in the
training program(Persons/Cumulative)

971

2,018

5,000

Ratio of strategic
suppliers1) to be rated

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

67

73.5

100

Number of suppliers
supported with
consulting services(Number/Cumulative)

16

40

100

Supplier Sustainability Guidelines, we encourage suppliers
to comply with their social responsibilities and reduce theirenvironmental and social impact on the value chain before thebusiness. A total of 35 compliance items, including human rights
and labor (7), safety and health (8), environmental protection(11), and ethical management (9), are presented, and detailed
practices are described as manuals and shared with suppliers.
Additionally, when signing a contract, all suppliers are required

Amorepacific Group is committed to managing
business risks and fulfilling its social responsibilities
across the value chain. We strive to fulfill ourenvironmental and social responsibilities to enhancesustainability of the supply chain, by supporting our
suppliers through ESG capacity enhancement and risk
reduction consulting.

to adhere to Amorepacific Group’s Code of Ethics and Supplier
Sustainability Guidelines.

Guidelines for Sustainable Management of Partners

in the sustainability
assessment by 2025
Number of suppliers
supported with
consulting services
for sustainability
improvement by 2025

Amorepacific Group is practicing shared growth by supporting
our suppliers to strengthen sustainability. We continue to
conduct on-site consulting to ensure that our suppliers havethe capability to respond proactively to ESG risks.
Through consulting on environmental law, which began in
2019, we continue to diagnose environmental risks of strategic
suppliers, derive improvements, and train them to strengthen
their capabilities. Some of the suppliers conducted customized
consulting to raise the level of environmental management.
We evaluated the implementation of improvement measures
for all suppliers who were assessed to have improvement
points, and selected and awarded suppliers with excellent
performance. In addition, we conducted safety and healthconsulting to identify our suppliers’ safety and healthmanagement system and the risk factors of the workplaceand suggested improvements. We plan to gradually expand
related activities. We also helped suppliers obtain certification
for packaging material with environmental improvement
traits, and provided how-to trainings to strategic suppliers thatwish to receive certification for environmental improvement
packaging materials.

Operation of Supplier Complaint Handling Channel

1) Suppliers from which the Group purchases over 1 billion KRW a year

Smooth communication with suppliers is essential for
maintaining sustainable relations between AmorepacificGroup and its suppliers. Amorepacific Group operates acomplaint handling channel for our suppliers within the
integrated purchasing portal in order to enable more effective
communication with them. Suppliers can share complaints inall areas, including human rights, safety and health, and theenvironment. There were zero complaints received through thechannel in 2022.

55

Sustainability Assessment for Suppliers
Amorepacific Group is committed to creating a healthy
corporate ecosystem by enhancing the sustainability of
our supply chain. In order to assess and manage potential
ESG risks for our suppliers, we are conducting businesswith suppliers who meet the minimum sustainability
requirements when signing contracts. We evaluate
new and existing suppliers on sustainable management
indicators such as quality, product safety, human rights,
safety and health, and environment, and carefully identify
risks and determine contractual relationships based on the
results.
Additionally, regular annual sustainability assessments are
conducted for suppliers of a certain size or larger, including
significant suppliers, and the results are reflected in thecomprehensive evaluation of suppliers with a weightageof 10%. The five areas, human rights, safety and health,environment, business ethics, and management systemare evaluated using checklists that apply international
standards such as the RBA1) Code of Conduct, and OECD2)Guidelines for Corporate Due Diligence. Based on the resultsof the comprehensive evaluation, excellent suppliers areprovided with incentives such as priority support for shared
growth programs, priority allocation of transactions, andawards.
In the last three years, a total of 119 suppliers received
sustainability assessments from a third-party independent
organization, and the 2022 sustainability assessment
showed areas of improvement for all target suppliers.
We expect all suppliers who received a certain level ofrating or have been found with serious violations, to adopt
plans and measures for improvement. In particular, wecheck whether the improvement action has been taken
for significant suppliers. We also plan to provide support
programs when suppliers need to improve ESG capabilities,

and will adopt follow-up measures such as reducing andlimiting transactions if ratings below a certain level persist.
Meanwhile, financial risks are managed by conducting
separate credit ratings for all suppliers, and for secondary
significant suppliers, we carry out suveys to identify
potential risks in transactions.

Supplier Sustainability Assessment Process

Results of Supplier Sustainability Assessment
Category

2020 2021 2022

Ratio of new suppliers that received
sustainability assessment in the past
three years (%)

100

100

100

Ratio of significant suppliers thatreceived sustainability assessment in
the past three years (%)

100

100

100

Preparation for Assessment· Update assessment indicators· Selection of suppliers to be evaluated

Desk Assessment· Utilizing online platform (self-assessment)

Status of Corrective Action Taken for High-risk
Significant Suppliers
Category

Status Check· Conducting on-site assessment for high-risk suppliers(Performed by specialized third-party organization)

Derive Results· Identifying risks and deriving improvement tasks foreach supplier

Number of high-risk significant
suppliers

2020 2021 2022
3

1

0Rate of requests for corrective action
(%)

100

100

-

Rate of established corrective action
plan (%)

100

100

-

Rate of completion of corrective action
(%)

100

100

-

Follow-up Measures· Request for corrective actions and confirmation ofcorrective plans· Distributing results reports

1) RBA(Responsible Business Alliance)
2) OECD(Organisation for Economic Co-operation and Development)

56

Mutual Growth

Mutual Growth Strategy

MissionStrategic Directions

Key Activities for 2022

Amorepacific Group is committed to fulfilling its
corporate citizenship responsibilities and continues
its efforts to support the growth and innovation of
our suppliers. Recognizing the importance of mutual
growth, we provide support in areas such as finance,technological innovation, and growth infrastructure,
based on a strong and vigilant business partnerships.
Through this approach, we aim to enhance thesustainablel competitiveness of our suppliers, fosteringcontinuous and prosperity for both parties.

Financial Support

Enhancement of our fundamental competitiveness by supporting suppliers’
growth and innovation

Fair business relations
based on trust

Supporting growth andinnovation

Enhancing the sustainabilityof our partners

Financial Support

Technical Innovation
SupportGrowth Infrastructure
Support· 25.3 billion KRW of lowinterest rate loan funds· 33 collaborative research
projects with suppliers· 2.5 billion KRW for
the Mutual Growth
Investment Fund· 61% rate of improvement
for goods returned due
to contamination; 57%
rate of improvement forgoods returned due toimpurities· Provided educational
support for 1,047 supplieremployees· For companies with
Mutual Growth
Agreements - 100% cash
payment within ten daysof receiving an invoice· 54 employees dispatchedto suppliers to lead
support efforts· Supported 20 suppliers indiagnosis and consulting
on environmental law, and4 suppliers on safety andhealth consulting· Assessed 16 suppliers on
the implementation of
improvements based on
environmental regulations

Strengthening Support with Low Interest Rate Loan
Funds
Amorepacific Group operates various financial support
programs and funds to strengthen management stability of
our suppliers and pave the way for innovative growth. In orderto create a stable business environment for suppliers, we
provide 900 million KRW worth of ‘Win-Win Fund Programs’
through direct support. In cooperation with the Industrial
Bank of Korea, the size of the ‘Mutual Growth Fund Programs,’
a low-interest rate loan support, was expanded to 21.4 billion
KRW. This is the result of strengthening operational support
for suppliers with an increase of 6.3 billion KRW compared tothe previous year. In addition, we are operating an additional
Door-to-door sales Agency Support Fund worth 3 billion KRW
in cooperation with Woori Bank. Moreover, as of 2022 ‘Mutual
Growth Investment Fund,’ worth 2.544 billion KRW, wasoperated to strengthen the capabilities of our suppliers.

Operating Mutual Growth Payment System
Since Amorepacific Group implemented a mutual growth
payment system in 2019, the Group has been operating a‘100% Cash Payment within 10 Days’ system for 110 small andmedium-sized enterprises as of 2022. Additionally, in 2022, thefoundation was strengthened to ensure the flow of payments
to secondary suppliers linked to 105 primary suppliers.
Payment through the mutual growth payment system in 2022
was KRW 303.82 billion, contributing to the transparent andstable flow of funds throughout the supply chain.

57

Technological Innovation Support

Support for Growth Infrastructure

Participation in Purchase Condition-Based New
Product Development Project

Improvement of Contamination and Impurity Issues
through Consultations

Amorepacific Group has been participating in the ‘PurchaseTerms for a New Product Development Project’ through anagreement with the Ministry of SMEs and Startups since2019. For four years until 2022, we supported the small andmedium-sized enterprises with the development of newtechnologies and new products through total funding of KRW
4.29 billion. In 2022, through this project, we developed adual mixing functional cosmetic container, that could hold an
oxygen cartridge and functional raw materials, in 2022.

In 2022, in order to upgrade the quality capabilities andproduction technology of its suppliers, the Group provided
consulting for six suppliers to improve issues such as
contamination and impurities. This resulted in the rate ofproducts returned due to contamination, to improve by 61%
compared to the previous year, while the rate of products
returned due to impurities improved by 57% compared to theprevious year.

Support for the Establishment of a Manufacturing
Execution System (MES)
Amorepacific Group is supporting the establishment of a
‘MES Manufacturing Execution System for Smart factory
implementation for Suppliers.’ A total of six suppliers (2 in
2020, 1 in 2021, and 3 in 2022) were the beneficiaries over
the three-year period. Through this, we were able to speed
up our supplier’ work by establishing systems such as realtime production operations, delivery plan management
linked to Amorepacific systems, and data-based inventory
management. In the future, Amorepacific Group plans tofurther expand support related to productivity improvement
so that our suppliers, who have continued to cooperate for along time, can continue to strengthen the efficiency of overallmanagement activities.

Operation of Performance Sharing Program
The performance sharing program allows for mutual growthof the Group and suppliers by sharing technical and financial
results when achieving goals through joint innovation
projects. In 2022, we provided about KRW 163 million for
R&D expenses to our suppliers through the operation of sevenprojects.

Securing Sales Channels for SMEs

Operation of Mutual Growth Academy

Amorepacific Group has been supporting SMEs with costs andmanpower to participate in overseas exhibitions every year
since 2015 to enable them to secure a sales channel in the
global market. In 2022, we provided a total of KRW 50 million
for the costs of booth installation to five suppliers at the
Cosmoprof Asia Singapore 2022 event, one of the world’s top
three beauty exhibitions, held offline in Singapore for the firsttime in three years.

Amorepacific Group operates its own training programs
to improve the capabilities of the suppliers’ employees andto supply stable manpower. In 2022, the training focusedon improving practical issues such as essential tasks in thecosmetic industry, product quality, production processes, andother on-site operations. Through this effort, a total of 35 newcourses were launched, including training for specific jobs,
new employees, and manager positions. We provided training
to 1,047 employees of 79 suppliers who are eligible for onsite training, and we continue to encourage them to actively
communicate in the event of issues in their job.

58

Product Safety

Product Safety Management System

Product Safety Enhancement Activities

Product Safety Management Standard

Product Safety Assessment

Amorepacific complies with laws and regulations aroundthe world, where 23 overseas subsidiaries have entered
the market including US, EU, Japan, China, and ASEAN. We
are also continuously monitoring trends in global chemical
substance standards, and safety evaluations trends in closely
connected sectors such as drinking water, foods and theenvironment, and establish and implement strict self-quality
standards. Representative global regulations covered by
Amorepacific Group’s own quality standards include EU REACH
and CLP (Classification, Labelling and Packaging Regulations),
laws governing pharmaceuticals and food additives. At thesame time, evaluation results from internationally trusted
organizations such as SCCS, CIR, EFSA, and IARC are also
monitored actively for internal quality control. In addition, even
if it is legally permitted, the use of certain ingredients suchas parabens, triclosan, benzophenones, some colorants andsome UV filters are prohibited according to Amorepacific’s own
internal standards, based on comprehensive consideration ofcustomer concerns and safety research results.

Amorepacific Group operates a product safety assessment process to ensure that ingredients and products are thoroughly validated
for safety and efficacy based on its own global standards. We carefully select ingredients and raw materials based on various scientificevidences, and develop products that are safe for both people and the environment based on meticulous safety evaluations not only for the
final products but also for the raw materials.

Product Safety Management System

Amorepacific Group considers providing safe products
as the most important value and manages everythingfrom product development to product use based on
stringent processes. In addition to compliance withdomestic and international regulations, we thoroughly
ensure safety from raw materials to the final products
through our own global leading quality standards.

Amorepacific Group operates various expert organizations
systematically to thoroughly manage the safety and qualityof its products. We ensure customer safety when using our
products through experts on domestic and international
cosmetic regulations and experts on analysis, safety, stability,and efficacy regarding quality management of cosmetic
ingredients and products.

Product Safety Assessment Process

Step 1
Rigorous Selection of
Ingredients

Step 2
Meticulous Management of
Raw Material

Step 3
Various Safety Assessments

Step 4
Thorough Post Management· Exclusion of harmful ingredients and establishment of strict standards for mixing of each ingredient· Ingredient research skills accumulated over decades and over 50,000 databases secured· Meticulous safety tests conducted at higher concentrations than actual use(Animal testing alternatives, skin irritation test, hypoallergenic test, etc.)· Ensuring compliance with global quality standards and conducting multiple safety assessments fromproduction process to finished products(Skin and scalp irritation tested on sensitive skin, skin and eye irritation tests, dermatology tests, noncomedogenic tests, etc.)· Adverse reactions and complaints after product use are monitored and collected/analyzed.
· Systematic customer response via our system for managing complaints regarding undesired effects, andreflection of VOCs in our product development/improvement

59Technology for Environmental Impact Assessments
As environmental concerns are increasing, more andmore customers are looking for products with minimal
environmental impact. In 2015, Amorepacific Group
implemented a test method to assess toxicity in the aquatic
environment for the first time in the Korean cosmetics
industry, and began researching the products’ impact on theenvironment to realize customer values. Amorepacific Groupevaluates the environmental impact of products by identifying
Persistence (Biodegradation) Score, Bioaccumulation Score,and (Aquatic) Toxicity Score of each of the ingredients andthe raw materials used, and reflects the results in developing
products with lower environmental impact.

Environmental Impact Scoring Algorithm
Persistence (Biodegradation)
The degree to which anorganic substance released
into the environmentis decomposed by
microorganisms[Case] Product Safety Enhancement

Biodegradable ingredient content increased in
HAPPY BATH Original Collection Body WashHAPPY BATH has launched a body wash product with 99%
biodegradable ingredients that can reduce harmful effects onwater and reduce negative environmental impacts.

Excluding Certain Ingredients
Amorepacific Group has been continuously advancing
formulation technologies to exclude specific ingredients that
customers do not prefer. These technologies maintain productquality without using preservatives, prevent unpleasant odors
without the need for fragrances, and ensure effective cleansing
without surfactants. To ensure the customers are provided
with the confidence that certain undesired ingredients are
excluded, internal processes such as analysis of trace materials
and cross-contamination prevention are operated to obtain
scientific evidences
In order to indicate that products are made through thisprocess, we provide information with ‘free’ marking so that
customers can easily make the choice they want. Of course,
it is not allowed to display ‘free’ if the ingredient cannot be
used because it is a prohibited material by the regulations.
We do not exaggerate the obvious to suggest significant or
meaningful implications.

· Water activity control technology· Rapid microorganism identification
technology
NonPreservatives
Technology· Microbiome-friendly technology· AI-based preservation efficacy
prediction technology, etc.

Non-fragrance
Technology

Aquatic Toxicity
The degree to which certain
type of chemicals haveadverse effect on organisms
in the ecosystem

Scoring/Total
by Ingredient

Product
Score· Analysis of off-odor or residual scentusing GC-MS(Gas ChromatographyMass Spectrometer), GC-IMS(Gas
Chromatography-Ion Mobility
Spectrometer)· Aroma sensory evaluation measurement
technology· Product/raw material odor evaluationand management technology

Bioaccumulation
The degree to which a specificsubstance in the environment
accumulates and builds up
in an organism through foodchain

· Antimicrobial technology using natural/
fermented/naturally derived ingredients

Trace-level
Analysis
Technology· Substance Qualitative/quantitative
analysis technology using NMR(Nuclear
Magnetic Resonance), LC-MS(Liquid
Chromatography Mass Spectrometry)· Trace contamination detection
technology using LC-MSMS/GCMSMS(Tandem Mass Spectrometry)

60

Non Animal Methodologies (MAMs) for Cosmetics
Testing
Amorepacific Group has been actively participating in the
research and utilization of animal alternatives since 1994,
which is approximately 23 years ahead of the 2017 legal ban
on cosmetics animal testing in South Korea. Since 2008,
Amorepacific Group has completely discontinued conducting
animal testing on its own, and since 2013, it has implemented
a total ban on animal testing, including all its partnercompanies.
In order to evaluate cosmetics raw materials and products
accurately, Amorepacific Group utilizes credible testing
methods such as OECD guidelines and certified tests from theEuropean Centre for the Validation of Alternative Methods(ECVAM) and in-house methods developed based on scientifictheory.
In particular, the research and development capabilities behind
our own animal replacement test method have resulted in
59 domestic and international research papers, 15 patents1).
Additionally we actively engage in many international joint
studies and consistently present academic achievements at
global toxicology conferences in the United States, Europe,and other regions. Recently, we initiated research into nextgeneration animal replacement testing methods such as
microdevice-based 3D hybrid artificial tissue, which mimics
human organs and blood vessels, allowing us to assess theimpact on skin tissue and organs based on material flow,
skin penetration prediction program and comprehensive
construction of database.

1) Papers and patents as of December 2022

Research on Sensitive Skin

Strengthening Production Quality

Amorepacific Group has been steadily studying thecharacteristics of sensitive skin since the launch of thebrand Soonjung, a brand specializing in sensitive skin,in 1988. We have established the base for research on
sensitive skin through collaboration with outstanding
hospitals in Korea. We further strengthened Amorepacific’s
proprietary sensitive skin evaluation system throughresearch on skin characteristics in Korea, China, the US, EU
and South East Asia, the characteristics of the microbiomeof sensitive skin, and diagnosing sensitive skin based ongene polymorphism. Moreover, to better understand andaddress customer concerns related to specific area like thescalp, eyes, and lips as well as skin, we are expanding thescope of our research. We are providing customers withmore in-depth and personalized solutions for sensitive skin,striving to offer the best possible outcomes.

The cosmetics manufacturing process requires extreme
precision, as even the slightest differences can have atremendous impact on the quality of the final product. To
minimize variability in results and maximize product quality,
we have developed the technology to predict the direction
and speed of formula movement. Since 2012, we haveanalyzed countless flow patterns and made modifications
to the production processes and structures of our facilities.
We have gone a step further by using this data to build
facilities with layouts and structures customized to particularcosmetics formulations - a manufacturing innovation uniqueto Amorepacific.
With the goal of standardizing quality across our production
facilities, we have integrated IT and manufacturing
technologies to create the Recipe Control System (RCS)that regulates the entire cosmetics manufacturing process.
Our RCS has enabled us to eliminate human error from the
manufacturing process, thereby minimizing deviations inquality and enabling us to continue delivering the healthiest,
safest, and the most effective products to our customers.
In addition, we strengthened the safe production systemby establishing a bulk tracking system. IoT (Internet ofThings) infrastructure has been integrated to the bulk
storage container, a tool for storing manufactured bulk to betransported to the storage and then to the packaging line, toenable automatic cleaning and management of the storage
container. Moreover, we established cleaning expiration dates
based on microbiologival tests and introduced a Fool Proof
function, ensuring that storage containers beyond the cleaning
date are rendered unusable.

61

Customer
Satisfaction

Enhancing Customer Communication
Improving Customer Consultation Process
Amorepacific Group is dedicating company-wide efforts
to ensure that customers have a positive experience acrossvarious online and offline sales channels. In particular, we
focus on identifying dissatisfaction factors felt by customers
and strive to maximize customer satisfaction by implementing
the process of ‘Monitoring - On-Site Sharing - Improvement
Activities’ to Voice of Customer (VOC) response process foreach e-commerce platform.
Starting from 2021, Tiki Taka VOC, previously operated as aregular program, has been transformed into a weekly NEWS
format, enabling rapid sharing of VOC findings with the field
departments. This allows us to swiftly address and improvevarious aspects, including brand, sales, and logistics, according
to customer feedback. From June to December 2022, a total of
61 VOCs were shared with the workplace via Weekly NEWS.
Additionally, we continue to manage quality by incorporating
customer opinions related to product and service quality. As
part of our efforts to address customer concerns, we havepublished a total of 19 Customer Gifts for Amorepacific (CGAP)
and conducted 53 product analyses.

Procedure for Reception and Processing of VOC
Since the COVID-19 pandemic, customer VOCs have beenchanging, and we responded by organizing the CGAP
exhibition, which we held in an on-off hybrid format, where
we shared these changes with all executives and employees(Headquarters, Osan Amore Beauty Part, Daejeon businessoffice). . Through the exhibition, we shared the importanceof customer experience value for products and services withall of the Group’s brands, and pledged to actively pursue
continuous improvement. Considering the evolving distribution
environment, we will continue to monitor VOCs from global
e-commerce customers, sharing the feedback with field
departments to enhance customers’ purchasing experienceand expand our quality management efforts.

· Phone calls
Voice ofCustomer· Chats· Official website· E-mail

Understanding
the Status Quo· Professional consultation(Phone call or visit)

Analysis of
Status Quo andResolution· Analysis of the cause
and establishment ofcountermeasures by thedepartment in charge of
quality· Analysis results notification

Amorepacific Group considers customer satisfaction
as our top priority and strives relentlessly to improve
product and service quality. We also aim to enhancecustomer satisfaction by gathering and incorporating
customer feedback to identify areas for improvement.

Response to
Customer· Consumer dispute resolution· Handling based on criteria

62[Case] Products Development Reflecting Customer VOC

Management of Customer Satisfaction

Ethical Marketing Development

Amorepacific Group listens to its customers and is committed
to addressing their complaints. We analyze the received
feedback and actively incorporate improvement measures
into product development and enhancement. Moreover,
we prioritize reflecting customer needs in our productdevelopment to maximize customer satisfaction when using
Amorepacific Group products.

In order to provide customers with the best products andservice experience, Amorepacific has been carrying out various
customer satisfaction management activities, including
conducting satisfaction survey on all customers who havecompleted customer consultations, since 2019. In 2022, out of
the 715 consumer complaints received by Amorepacific, 714
were successfully resolved, resulting in an impressive 99.9%
complaint resolution rate1), which is approximately 1% higher
than the previous year. Additionally, Amorepacific achieved acustomer service satisfaction score of 82.9 points in 2022.

Amorepacific Group strives to provide customers withaccurate and balanced information about products andservices. In 2022, we supported members in internalizing
the ‘Guidelines for Notification on the Environmental
Marketing and Advertising Management System’ which
was established in 2021. This initiative aims to prevent theprovision of exaggerated or misleading information about
the environmental impact of our products and services,
ensuring consumers’ right to be well-informed. Additionally,
Amorepacific Group is committed to providing informationthat will not lead to any unnecessary misunderstandings
about our competitors’ products and services among ourcustomers. Moreover, we are dedicated to avoiding expressions
that promote excessive consumption or negatively impact
emotions, among teenagers.

LABO-H Launched ‘Perfume Edition’ Product,
Developed Based on CS
LABO-H, a brand specializing in scalp skincare, launched two
new perfume editions that add fragrance to their existing
scalp-enhanced shampoo. This product development was inresponse to continuous customer feedback requesting theaddition of a fragrance line. In particular, by actively reflecting
the opinions of the MZ generation consumers, who seek
sensuous scents aswell as functions
to improve early
hair loss, we added
trendy and uniquefragrances beyond
the popular scentsof the existing scalpenhacing shampoos.
LABO-H willcontinue to listen to
customers’ voices
and make efforts to
help customers takecare of their scalp
more pleasantly.
LABO-H, Perfume Edition

AMORE Brand Image Perception Survey

HERA, Sensual Fitting Glow Tint

HERA Developed High-Color ‘Sensual Fitting Glow
Tint’
In July 2022, HERA launched ‘Sensual Fitting Glow Tint,’ aproduct that reflects 100% of the needs of its customers.
Throughout the product development process, HERA actively
sought customer feedback by conducting surveys and thirdparty comparison tests involving more than 1,000 participants.
Early on, the brand communicated with customers about
the development process through its social communicationaccount, and the main color was chosen based on thecustomers’ votes.
Through the development of these products with customer
participation, HERA has strengthened the sense of selfassociation, allowing customers to a personal connection
with the brand. Even after the launch, HERA plans to continue
improving formulations and expanding the color range basedon customer communication.

Amorepacific Group conducts an annual Brand Image
Perception Survey for 5,000 women living in major Koreancities. In 2022, ESG items were added to the metrics used
to measure brand health at the awareness, considering,and purchasing stages, ensuring that the products have abrand image that meets the changing market environmentand customer needs. Specifically, we measured agreement
regarding major brands’ ‘Effort to Create a Better World,’
expressed in terms such as ‘Brand to be a Better Person,’‘Steadily Practicing Social Contribution Activities,’ and‘Excellence in Membership and Customer Management.’
This indicator confirmed whether the brands’ efforts tocreate a better society reached the customer and used it asa foundation for developing a strategy for ESG activities bybrand. In the survey conducted in 2023, we tried to respondactively to the rapidly changing market and customer situations
by applying changed expressions such as ‘Brand that Realizes
Social Values,’ ‘Brand that Respects Individual Diversity,’ ‘Clean
Beauty Brand,’ and ‘Brand that Cares about the Environment.’
We also expanded our measurement to include Chinese andU.S. customers.

1) Domestic records of Amorepacific

63[Case] Customer-specific Product and Service

Amorepacific Group listens to customers’ opinions andincorporates their feedback into the development of products
and services. We strive to enhance customer satisfaction byidentifying the diverse customers’ requests and needs, anddeveloping personalized products to cater to each individual
customer.

ETUDE
ETUDE is providing ‘Foundation Factory’ service at theirSinchon roadshop in Seoul, where they create customized
foundations for customers. They diagnose personal colors
by measuring customers’ skin color and tone using ‘Skin
Tone Finder’ developed in collaboration with Color Studies
Class at the Korea Advanced Institute of Science andTechnology(KAIST). They are working hard to ensure customer
satisfaction by providing ‘My Own Foundation’ based on
personal color through consultations with makeup experts.

ETUDE, Foundation Factory

Launch of Customized Products for Global Customer
Needs

LANEIGEHERALANEIGE has introduced a customer-tailored service called‘Bespoke Neo’. This service, available at the LANEIGE
showroom in Myeongdong, allows customers to createcustomized cushions and foundations. After measuring thecustomer’s skin tone, personalized color consulting is provided
to suggest the most suitable cushion or foundation for theirskin. The finished products are labeled with the customer’sname and the manufacturing date, emphasizing the uniquenature of the custom-made products.

In April 2023, HERA launched Silky Stay Custom Match (custom
foundation service) at Amore Seongsu and on online Global
Amore Mall. Based on Amorepacific’s expert color research,
they offered 125 customized shades that precisely match skintone and brightness, allowing customers to choose the perfectshade tailored to their individual skin tone. At Amore Seongsu,
professional consulting services were provided through 1:1
touch-up service by makeup artists, and upon selecting theirpreferred shade, a personalized foundation was prepared
immediately and provided on the spot. HERA will continue its
skin reseach for diverse races and nationalities to strengthen
customer satisfaction in our global consumers.

LANEIGE, Bespoke Neo

HERA, Custom Match

In 2022, Amorepacific Shanghai D&I Center developed
locally exclusive products tailored to customer needs in the
Chinese market. We conducted research on the foundationpreferences for Chinese customers and developed ‘MamondeNudy Fit Foundation’ product based on these results. We
customized moisturization, application, and adhesion using
coating pigment raw materials preferred by local customers in
China, and applied powder milling process technology for an
optimized finish.
Furthermore, we applied the trend of the hair product market
in China to develop high moisturizing and high-efficacy hairproducts using fragrances that combine flowers and tea, which
are preferred by local consumers. Different flowers and tea
were used for each of the three products, and varying degrees
of efficacy were implemented to reflect customer needs. ‘Ryo
Peach Oolong Tea Shampoo & Conditioner’ is designed formoisturization and hair smoothness; ‘Ryo Yuzu Black Tea
Shampoo & Conditioner’ is designed for oil control and hairvolume; and ‘Ryo Jasmine White Tea Shampoo & Conditioner’is designed for moisturization and anti-dandruff properties.

64

ARITAUM Launches Instant Delivery Service
through Baemin StoreLANEIGE Launched Limited Edition Product inCollaboration with Maison Kitsune

HERA Promotes Cultural Diversity through Cultural
Collaboration Projects

Following Yogiyo, ARITAUM signed a partnership agreementwith the ‘Baemin’ and introduced a real-time product delivery
service. It offers an advantage for customers in that they canreceive ARITAUM’s products conveniently at their desired
location within an hour through the smartphone application‘Baemin Store.’ When customers order ARITAUM’s products
from ‘Baemin Store’ application, the products are delivered
immediately through a delivery agency. Since its launch in
December 2021 in Seoul area, the service has expanded toinclude ARITAUM stores in Gyeonggido, Incheon and otherregions of the Seoul metropolitan area.

In 2022, LANEIGE launched its second limited-edition
collaboration product with the French fashion brand Maison
Kitsune, following the success of their first collaboration in
2021. The new limited edition, NEO CUSHION X MAISONKITSUNE LIMITED EDITION2 was made based on the conceptof “HEY NEO, WHY SO GRAY?”

Through Cultural Collaboration Project, HERA has beenoffering its customers contemporary aesthetic experience andcultural diversity, partnering with brands or artists who aretrailblazing independent careers based in Seoul.

We wanted to convey a message of hope by adding orange
as a point color to the gray shade, inspired by the rising sun
against the dark skies at dawn. The edition consists of two Neo
cushion products and three goods including a padded eco bag,a phone holder cross bag, and a key ring specially made forthis collaboration. The product was released in 10 countries
including Korea, Thailand, and Japan, and received love andsupport from global customers.

In April 2022, the ‘SCENE #000000 Scene Number Black’campaign was held with Aufglet, a multi-dimensional
cultural space that proposes new ways within familiar zones,
centered around the theme of space in Seoul. Through thiscollaboration, customers were able to experience momentsof pioneering ‘being me’ from a fresh perspective within afamiliar surrounding. In June, with three illustrators working
in Seoul, HERA expressed the daily life of summer through theunique eyes of the artists, capturing the daily lives of Seoullistas
who enjoy summer with their own colors. In September,
HEAR partnered with the MVP dance crew, a leading force
in the domestic dance scene, to showcase their distinctive
black performances and share stories that resonate with MZs
about what makes them true MVPs. In addition, HERA iscollaborating on more than 100 contents with 30 crews from
‘C.CREW,’ HERA’s creator crew, to explore various themes suchas Seoul’s colors, festivals, and people.
HERA will continue to engage in collaborations with uniqueartists and creators in various creative activities, and will hold
events where customers can participate and experience Hera’s
stories of diversity.

LANEIGE, NEO CUSHION × MAISON KITSUNEHERA, Black Cushion×AUFGLET65

Information Security

Information Security System
Information Security Declaration
Amorepacific Group communicates its dedication, objectives,and action policy regarding information protection toemployees through the Information Security Declaration.
Furthermore, detailed security guidelines are designated ascompany rules to ensure that employees comply with them.
We are doing our best to protect personal information andstrengthen information security. In the event of any accidental
or intentional violation that causes damage to the company
or compromises customer rights, appropriate disciplinary
measures are taken.

Information Security Management System

Amorepacific Group has established a comprehensive
information security management system to respondto cyber attacks and various threats targeting valuable
information and assets. Through information security
declarations and education, we are raising the level of
information security awareness among our employees
and suppliers. Additionally, we are strengthening
our ability to respond to information security threatsby assessing security vulnerabilities regularly andestablishing recovery systems.

Amorepacific Group considers privacy protection as a criticalcompany-wide risk and manages it accordingly. Through the
Risk Management Committee, we report privacy protection
risks and our security strategies to key executives on aregular basis. Policies are established and operated to meetlegal requirements, and close coordination is implemented
for each subsidiary by designating the Chief Information
Safety Officer (CISO), and Chief Privacy Officer (CPO). The
head of the Information Security Center is responsible for
information protection and privacy protection, and is incharge of protecting corporate information, customer data,and employees’ personal information from cyber attacks.
Furthermore, we have developed a comprehensive Information
Security Management System in accordance with thecertification standards set by national authorities. We undergo
annual assessments to obtain and maintain the certification.
In particular, the headquarters, Amazon Web Service(AWS),Songdo Computer Center, and Jukjeon Disaster Recovery (DR)Center are reviewed comprehensively for manpower, computerresources, and physical environment, with improvements
made to address any identified deficiencies.

Customer Personal Information Protection Activities

Information Security Training for Employees

Amorepacific Group prioritizes customer privacy protection
from the planning stage of all businesses activities related toour customers, and provides services only when they meet
our established standards. As an essential procedure, consent
is sought when collecting personal information, and various
technologies are applied to keep the collected information safe.
We use personal information only for the purposes specified
and agreed upon with the customers. In addition, guidanceon our personal information processing policy is provided toconsumers through the website for easy access.

Amorepacific Group conducts mandatory training once a year
to raise employees’ awareness of information security. In
2022, over 95% of employees of Amorepacific Group and somesubsidiaries1) completed the compulsory education under thethemes of ‘Rules to Follow while Working,’ ‘Compliance with
Privacy Regulations,’ and ‘Ways to Consider Security in Digital
Business’. Furthermore, both online and offline education
sessions were conducted for all store and door-to-door sales
beauty partners who directly interact with customers, focusing
on the importance of ‘Preventing the Misuse of Customers’
Personal Information’.

In order for the personal information processing system tocomply with the law and the company’s security standards, agroup of internal and external experts conduct a full inspection
and implement necessary improvements on an annual basis.
Furthermore, to prevent any personal information leakage
through website hacking, we conduct annual simulated
hacking tests using the same techniques employed by hackers,
and improve the vulnerabilities found. Moreover, we haveintroduced a robust malware defense system to prevent theleaking of customer personal information from targeted
attacks on our employees. This multi-layered defense system
extends even to our IT service employees. In 2022, there wasonly one complaint received from outside related to personal
information infringement, and the report was made to therelevant authorities and follow-up measures were completed.

1)	Amorepacific, ETUDE, innisfree, Espoir, AESTURA, AMOS Professional,
OSULLOC

66

Protection of Supplier Privacy

Conducting BCP Tests for System Disruptions

We disclose the list of companies on the website, when
personal information is entrusted to a supplier to ensure
seamless customer service. In 2022, we conducted tailorededucation for 260 suppliers to enable them to securely manage
personal information based on the nature of their tasks.
Additionally, based on a total of 25 items, we conducted four
diagnoses on the privacy level of our suppliers. The diagnosis
results were categorized into five levels, and suppliers scoring
below a certain level were provided with support to implement
necessary improvements. If a supplier’s business contract
expires, the company manages the immediate deletion ofAmorepacific Group’s customers’ information, and in 2022, wereceived a total of 24 confirmations regarding destruction ofcustomer data.

Amorepacific Group conducts regular Business Continuity Plan
(BCP) tests to ensure that critical customer services are notinterrupted by natural, artificial or internal factors. For disasterrecovery planning, we have established a disaster classification,
defined and declared the emergency organization, andspecified the detailed recovery procedures. Our key systems
such as online shopping platforms and point-of-sale systems
are replicated to the Disaster Recovery (DR) Center in orderto mobilize prompt action in case of a disaster. Additionally,
simulated recovery tests are conducted once a year to verify
the accuracy of our disaster recovery plan, and ensure that all
responsible personnel are well-versed in their roles, enabling
swift system restoration in the event of an emergency.

New Digital Environment Security
Even with the increasing use of cloud services, following thegrowing trend of digitalization, it is important to maintainthe consistent level of security. We have implemented
a configuration management monitoring system that
automatically detects any incidents, to prevent any
mishandling of the cloud service, resulting in the exposure ofsensitive information or unauthorized access. Additionally, inthe DevOps development environment, which allows rapid
responsiveness to customer service improvements, we conduct
automatic checks to ensure that the source code remains
secure and resilient against hacking attempts, guaranteeing asafe digital environment for our customers.

Modifying and Supplementing Test Plans

Preparing for disaster recovery tests by teamDivisional Testing

Perform department-wise disaster recovery tests

Preparing for a Test Plan

Modification and supplementation of divisional disaster recovery test results

Divisional Testing

Divisional testing for completion of modifications prior to comprehensive testing

Test Completion Report (Modify and supplement thetest plan)

Report to the emergency response team and correct necessary parts after documenting
divisional test results.

Training by TeamAll disaster recovery personnel are required to complete disaster recovery training (Dispatcheddisaster recovery center personnel must complete designated trainings).

Pre-comprehensive Testing

Divisional testing in the order of disaster recovery plans

Promulgating the Results of Pre-comprehensive Tests(Revised and supplemented disaster recovery plan)

Revision and supplementation of the disaster recovery plan after the emergency response
team’s announcement of the preliminary comprehensive test results

Preparing for Disaster Recovery Plan Real-world Test

Test plan and necessary requirements preparation check

Disaster Recovery Testing

All disaster recovery personnel are required to complete disaster recovery training (Dispatcheddisaster recovery center personnel must complete designated training).

Evaluation and Presentation of Test Results

All disaster recovery personnel are required to complete disaster recovery training (Dispatcheddisaster recovery center personnel must complete designated training)

Modifying and Supplementing Disaster Recovery
Plans

All disaster recovery personnel have completed disaster recovery training (Dispatched disasterrecovery center personnel have completed designated training).

67

CSR

Implementation of CSR

Amorepacific Sympathy Foundation (Formerly
Amorepacific Welfare Foundation)

Direction of CSR Implementation

Amorepacific Welfare Foundation was established to support
the socially vulnerable pursue healthy and beautiful lives. It
contributes to the development of the community through various
public-private cooperation projects, and transforms outdated andabandoned spaces to create new cultural spaces for local residents.
Meanwhile, in November 2022, Amorepacific Welfare Foundation
changed its name to Amorepacific Sympathy Foundation, andfrom 2023, it will take the lead in expanding opportunities
for more young people to participate in society by focusing on
improving their mental well-being and supporting economic
independence.

Amorepacific Group strives to contribute to the community andfulfill CSR. Through this, we aim to pursue mutual growth withall stakeholder groups and spread the value of diversity andinclusion. Under the vision of ‘2030 A MORE Beautiful Promise’to strengthen economic capabilities for those in need of economic
independence and invest 100 billion KRW to enable citizens
lead healthy lives, various CSR programs are being promoted tospread positive effects across society.

Amorepacific Foundation
The Amorepacific Foundation conducts research on two specificthemes, one being ‘Asian Beauty’ and the other being ‘Womenand Culture.’ Furthermore, the Foundation runs ‘Jangwon
Humanities Scholars’ support project to discover and nurture
emerging researchers in the field of the humanities. Additionally,
the Foundation contributes to the vitalization of domestic andinternational research networks by supporting the translationand overseas publication of outstanding research.

Amorepacific Group believes in the positive effects thatbeauty can have on people and the world. We operatevarious CSR programs to help our stakeholders achievesustainable and harmonious growth.

In 2022, the Foundation held a research contest for the ‘Asian
Beauty’ project. Out of the 44 papers received over the two-weekonline application period in June, three were selected as finalists,and four domestic and overseas editions of the Asian Beauty bookseries were published. The ‘Women and Culture’ research contest
and support project were also conducted similarly, with 30 out of
286 research projects selected as finalists. In the end, 30 research
papers were published in 2022. The ‘Jangwon Humanities
Scholars’ support project selected two emerging researchers in
2022 providing them with a stable research environment to build
their own solid foundational research platform.

In 2022, the Spatial Culture Improvement Project, previously
limited to existing women’s facilities and non-profit women’sorganizations, was expanded to include non-profit facilities
nationwide dedicated to addressing social issues. A total of 219
proposals were received through the public offering project,and 7 non-profit facilities were selected to improve the poor
education centers, lounges, and offices with brighter and pleasantinteriors. The improvement of the spaces has helped enhanceuser convenience, stability, concentration, motivation, and overallsatisfaction by more than 70% compared to before.
We also actively conducted community development programs
based on employees’ talents. A total of three unique stores in
Seoul, including Namyeong-dong and Hangangro-dong, havebeen renovated through ‘Designer Dedicated to our Store.’
Furthermore, ‘Bukchon Middle House,’ created through ‘My
Neighborhood Idle Center,’ converted an abandoned hanok intoa cultural center for Bukchon locals and enhanced space use byintegrating Bukchon residents’ tour programs.
Additionally, ‘Yongsan Dragons,’ a civil, government, and academic
association in Yongsan-gu, Seoul, contributed to the developmentof the Yongsan-gu community by supporting underprivileged
residents, organizing probono youth job mentoring activities,

promoting child abuse prevention campaigns, and hosting
Christmas events involving Amorepacific employees.

Employee Volunteer Activities and Donation of Goods
Amorepacific Group encourages volunteer activities for employees
by team or organization. However, as the prolonged COVID-19
made it more challenging to organize volunteer activities forteams, organizational units, and individuals, the number ofparticipants and time of participation in volunteer activities havedecreased. In response to the post-COVID era, AmorepacificGroup is shifting our employee volunteer activities from time andparticipation-oriented activities to activities based on individualautonomy and expertise. We are actively conducting various
employee volunteer activities accordingly, including participationin brand and channel CSR campaigns and probono work.
Additionally, Amorepacific will increase our annual donationof goods to a maximum of KRW 5 billion, equivalent toapproximately KRW 25 billion in consumer value, to support the
livelihoods of 100,000 vulnerable individuals. Since the second
half of 2022, a total of KRW 2.9 billion worth of goods, threetimes larger than the previous year, has been donated to a totalof 96,000 beneficiaries.

Status of 2022 Employee Volunteer Activities
Category

Unit

Amorepacific AmorepacificGroup

Number of participants

Person243

221

Participation time

Hour

2,294

2,154

Average participation time

Hour

9

10

per person1)
1) The average participation time per person was calculated by dividing
the total participation time by the number of participants, and thecalculation method has been changed from the previous year.

68

Empowering Single Mothers through ‘Hope Store’
Amorepacific is realizing its long-standing CSR philosophy of‘Returning the love received from women to women’ throughthe ‘Hope Store’ initiative, which supports single mothers withstart-up loans to achieve economic independence. Through HopeStores, we aim to increase the average monthly income of female
entrepreneurs, establish a social support system, promote stabilize
emotions, and strengthen family relationships.
In 2022, as the government’s social distancing regulations eased,
the Hope Store business resumed face-to-face regular events in aphased manner. We continue to make efforts to restructure thebusiness network through gradual exchanges including overnight
face-to-face orientation programs, special lectures, small meetings,
and national conferences for working-level officials. In 2022,
Hope Stores boosted store sales and stabilized management
through various resource links. In particular, five stores overcame

Hope Stores

management crisis by receiving comprehensive management
consulting under the newly introduced ‘Management Improvement
Consulting’ initiative.
Additionally, a total of three online business briefing sessions were
held for prospective applicants who had difficulty applying forbusiness and preparing business plans, and a total of 147 founders
participated in the sessions. As a result of the support, the averagemonthly income of the founders increased slightly to about KRW
2.32 million in 2022, compared to approximately KRW 2.11 million
in 2021. Considering the nature of the Hope Store founders, who
operate small one-person businesses and bear sole responsibility
for their family’s economy, economic hardships may arise if they areunable to work due to diseases or accidents. In view of the situation,
total 67 founders were provided with comprehensive healthexamination expenses through the Health Rights Support Project,
and additional examinations and surgery expenses were provided
to a total of 6 founders who were found with medical issues.

‘A MORE Beautiful Challenge,’ Nurturing Social
Ventures in the Environmental Field‘A MORE Beautiful Challenge’ is a program that identifies andsupports social ventures with the potential to create impact andfoster growth. Organized by Amorepacific and operate by Merry
year Social Company (MYSC), a startup fostering and impact
investment company, the program provides opportunities for open
innovation connections and investment opportunities.
The first ‘A MORE Beautiful Challenge’ held in 2022, selected five
outstanding environmental startups capable of creating synergy inthe eco-friendly field. Through the program, we supported capacity
building training on ESG management, B Corp, RE100, etc., whileproviding an opportunity to explore open innovation with relavant
departments within Amorepacific through 1:1 meetings.

2022 A MORE Beautiful Day (ESG Forum)

In September, during the Demo Day, two outstanding companies
were selected based on the results of open innovation conducted
as a part of the program. And in October, these two companies
presented their ideas for collaboration with Amorepacific, in frontof all the employees at the ‘2022 A MORE Beautiful Day (ESG
Forum for A MORE Beautiful Future)’ event held at Amorepacificheadquarters. Subsequently, Investments were made in three
finalist companies, and through this, we aim to contribute to their
growth and the expansion of the social venture ecosystem.
Moveing forward, Amorepacific plans to further refine
environmental and social issues that can be tackled through open
innovation, continuously enhancing our collaboration framework.

69‘MEET YOUR DREAM,’ Youth Job Mentoring
Program‘makeup your Life,’ Empowering Cancer Patients to
Resume Daily Life

‘Beautiful Life,’ Creating Economic Independence for
Vulnerable Women‘Pink Ribbon Campaign,’ Enhancing Breast Health
Awareness

Since 2013, Amorepacific has been carrying out ‘MEET YOUR
DREAM’ probono activity, where a group of job experts
composed of employees provide career mentoring to womenand teenagers, transferring their professional skills. In 2022,
we worked hard to systematize the program, including for
online mentoring. We developed a new career mentoring
curriculum for researchers (big data, customized cosmetics),
and also introduced a marketer career mentoring program,which gained high satisfaction from participants.

Since 2008, Amorepacific has been conducting a makeup
education initiative called ‘makeup your Life’ for cancer
patients who experience appearance changes like skinalterations and hair loss during cancer treatment. By 2022,
the program has benefited a cumulative total of 20,817 cancer
patients, helping female cancer patients return to their daily
lives.

Since 2008, Amorepacific has been donating to ‘Beautiful
Life’ project, which integrates basic employment education(self-management, communication skills, service mindset,
economic/financial management, etc.), job-based customized
education and training, and mentoring, to support theeconomic independence of vulnerable women.

Amorepacific holds ‘Pink Ribbon Campaign’ every year topromote breast health awareness. In 2022, the first face-toface event since the outbreak of COVID-19 took place, and
the Pink Festival was held at the designated area in Yongsan
Park. Participants’ satisfaction was enhanced by expanding the
program from the existing running only, to various exercise
programs such as pilates, dance fit, Latin fit, and pound fit.

Amorepacific signed a business agreement with Gyeonggi-do
Province and the Gyeonggi-do Office of Education in 2021, to
promote ‘Gyeonggi-do Career Experience where Students andCompanies Meet,’ and provided support for career experienceeducation for middle school students in Gyeonggi-do Province
from 2022. From 2013 to 2022, 302 employees participatedin ‘MEET YOUR DREAM’ program as mentors and 4,829
teenagers were selected as mentees. Moreover, a total of 48
scholarship students were selected from 2017 to 2022 tonurture experts in the future makeup and hair fields, with 40of them obtained expert certificates. This created a cumulative
amount of KRW 780 million in monetized social value forstakeholders from 2017 to 2022.

Training teenagers to nurture makeup and hair experts

In 2022, a beauty therapy program was additionally introducedin Korea for medical staff who worked tirelessly to overcome
and prevent the spread of COVID-19. Talent donations frombeauty creators and makeup artists increased the program’s
effectiveness and participant satisfaction. Moreover,Amorepacific extended ‘makeup your Life’ program overseas,
and in 2022, 150 and 151 cancer patients participated in the
program respectively through our Taiwanese and Malaysiansubsidiaries.

makeup your Life in Malaysia

In January 2022, Amorepacific donated KRW 1 billion to
the Community Chest of Korea through the ‘Beautiful Life’program. Starting from 2022, the target of support has been
expanded to women and young people in need of economic
independence, and a total of 217 people participated in the‘Beautiful Life’ program throughout the year. In 2022, we
introduced specialized beauty industry job training courses tonurture hair designers and makeup artists. Our Amorepacificemployees actively participated as instructors and conducted
field training courses at our makeup professional team’s offices
and partnering hair and makeup shops. As a result, 4 outof 8 hair designer trainees succeeded in getting employed.
Amorepacific is committed to continually contributing tostrengthening the economic capabilities of those in need offinancial independence.

Out of approximately 1,000 participants, over 95% responded
positively to the survey on improving participants’ awarenessand health motivation after the event, and more than 98%
expressed their intention to participate again. The entire
participation fee was donated to the Korea Breast HealthFoundation to support the costs of surgical treatments andpreventive screenings for low-income breast cancer patients.
In 2022, around KRW 500 million was spent on the ‘Pink
Ribbon Campaign,’ with a cumulative total of 227,000 persons
participating until 2022.

70

A Win-Win Partnership with Local
Community | China
Mori run‘Mori Run’ is a collaborative public interest project organizedby Amorepacific China and the China Women’s Development
Foundation for seven consecutive years. Mori Run aims to raiseawareness of cancer prevention and treatment among women.
The ‘Mori Run’ event held in 2022 broke the limitations ofspace and introduced new activities to participate throughonline platforms. During the program, participants watchedvideos related to public welfare, gaining valuable insights
into cancer prevention and treatment. In addition, social
media platforms such as Weibo, WeChat, and Xiaohongshu(Chinese version of Instagram) were integrated and managed
to increase its social impact. Collaborating with Key Opinion
Leaders (KOL) 1) in sports and lifestyle areas aimed to amplify
interest in women’s health.

Two-cancer Screening

BETTER SHE

AMORE YOUTH

Amorepacific China, in collaboration with the China Women’sDevelopment Foundation, is dedicated to providing free
checkups for women aged 20 to 64 with the goal of preventing
breast and cervical cancers. About 120,000 women benefited
from the project from 2016 to 2022.

To further promote China’s ‘Rural Revitalization’ policy,
Amorepacific China started the BETTER SHE program
in collaboration with the China Women’s Development
Foundation in 2020. This project aims to educate womenin rural areas, empowering them to become caregiving
professionals and achieve economic independence andpersonal development.

AMORE YOUTH is the first ever psychological support initiative
for youths, launched by Amorepacific China in 2020. In 2022,
we provided online platform lectures along with offline events,
aiming to relieve the stress and anxiety that college students
experience regarding their studies, lives, and employment
and help them overcome difficulties with a positive mindset.
During the offline events, we conducted a total of 21 roadshows, lectures, and workshops benefiting 3,000 students.

In 2022, offline activities were conducted mainly in rural
areas such as Guizhou and Yunnan provinces. More than
9,000 women in these regions received support throughthe program. Moreover, additional training to improve their
testing capabilities, was provided to medical professionals toenhance the quality of medical services and raise awarenessabout the prevention of breast and cervical cancers.

In 2022, 800 women took part in training from four cities
in Guizhou Province and four cities in Heilongjiang Province,with employment rates exceeding 80%. Accordingly,
various lectures such as housekeeping service, elderly care,and childcare care were added to enhance the quality ofthe program, and more than 20 community lectures wereconducted in Heilongjiang Province to share housekeeping
skills with local residents. In addition, project videos have beenposted on social media platforms like WeChat and Weibo
to maximize the social impact of the program and collectfeedback on the related programs.

Starting from 2022, the program expanded its reach througha 21-day online psychotherapy course, consisting of six
different themes, and <Handbook for Infectious Diseases andPsychological Health of College Students> was given out tocollege students who had difficulties going to school. As aresult, 7,500 students participated through the online platform
in 2022.
Amorepacific is committed to further expanding its mental
health program for young people, with plans to extend theinitiative globally, including its headquarters in Korea.

1)	Influencers who can help expose brands on social media or influence thesales of products and services

BETTER SHE Program Training

AMORE YOUTH Workshop

71[Case] CSR

Innisfree Moeum Foundation

Innisfree Moeum Foundation is a non-profit organization established on Jeju Island in 2015 through innisfree’s donation commitment
of KRW 10 billion. The Foundation operates public interest projects dedicated to preserving Jeju’s natural ecology, fostering future
talents, and promoting Jeju’s unique cultural values.

ILLIYOON

Collecting and Climbing

Junior inniclass

Tangerine ScholarshipAs the number of visitors to Jeju increases, so does the issue
of indiscriminate garbage disposal. To address this problem,
Innisfree Moeum Foundation conducted an eco-friendly activity
called ‘Collecting and Climbing’ to solve the garbage problem
in Jeju’s Oreums and rivers. The Korean name for this initiative
is a combination of‘Collecting(garbage)’ and ‘Climbing(oreum),’with ‘plogging(walking and picking up trash),’ Through thisinitiative, more than 50 volunteers, accompanied by plantcommentators, collected 450 liters of garbage in the areas ofNamsongak Oreum, Sol Oreum, and Gungsancheon Stream
in 2022. Innisfree Moeum Foundation will continue to sharethe value of Jeju’s precious natural heritage through ecofriendly activities and encourage the practice of environmental
conservation in daily life.

‘Junior inniclass’ is an ecological environment education
program with themes focused on nature conservation,
environmental protection, and resource circulation. With the
purpose of cultivating environmental conservation awarenessamong children who will lead the future of Jeju, lipstick upcycled
crayons and coloring books featuring 12 indigenous plants ofJeju Island are used as teaching materials. From 2019 to 2022,
960 students from 31 elementary schools in various towns andvillages on Jeju Island participated, leaning to understand Jeju’snatural ecological environment and live wisely to contribute to
global environmental conservation.

Innisfree Moeum Foundation operates the Tangerine
Scholarship Program to find and support outstanding talentsin the tangerine agriculture sector, thereby enhancing thecompetitiveness of Jeju tangerines. Since 2018, the program
has awarded a total of KRW 98 million in scholarships to 64
high school and college students over five sessions.

Donation to the Corporation Aggregate Korea Atopy
Asscociation

Collecting and Climbing

Junior inniclass

Improving the Villages’ Economic Independence
Sinheung 2-ri Dongbaek Village, home to the 27th designatedJeju provincial monument, the camellia tree colony, is the firstvillage to establish a fair trade agreement with Amorepacific,
known as ‘Beautiful purchases agreement’. Dongbaek village
and Amorepacific have been pursuing a win-win relationshipfor more than 10 years. Dongbaek Village has been supplying
ingredients used in Amorepacific cosmetics, and Amorepacifichas designed the village logo and packages of edible camellia
oil, a product from the village, through talent donations fromits employees. In 2022, Innisfree Moeum Foundation helped
Dongbaek Village’s entry into the world of live commerce
through employee talent donations. Through the operation oflive commerce, the Foundation pioneered the online market
for edible camellia oil, the representative product of the village,
and further contributed to the village’s economic independence.

In 2022, ILLIYOON donated 1,000 units of ‘ILLIYOON MD
Red-itch care cream’ worth KRW 26 million to the Corporation Aggregate
Korea Atopy Asscociation to support underprivileged children.
By providing functional cosmetics approved by pediatric dermatologists
to alleviate itching, we sought to make a tangible difference in the lives of
atopic patients. In addition, the brand conducted sponsorship activities forunderprivileged children who are unable to purchase body moisturizers
due to economic difficulties despite skin concerns that damage their daily
lives.

Collaboration with Social Enterprise a’dren
In 2022, ILLIYOON conducted a collaboration project with a’dren todeliver children’s stories through design, and to donate a portion of theproceeds from the sales of designed objets to underprevileged children.
a’dren is a social design brand that sells patterned design products
inspired by children’s stories and artwork. Using the proceeds, ILLIYOON
continue to provide art education opportunities to underprevilegedchildren, extending continuous emotional support to children in child carefacilities.
ILLIYOON hosted an art class with a’dren under the theme of ‘Things
That Warm Me.’ They developed patterns that incorporated children’s
original artwork and stories and created a bag with the collaborative
pattern. This bag was presented as gifts to ILLIYOON customers who
made purchases. A portion of the profits generated from the sales will be
donated to support underprivileged children in the first half of 2023.

72

Governance2022 Performance

Average attendance rate at Board of Directors meetings

97%

Expansion of stock dividend payout ratio

34.9%

Rate of completing company-wide ethics education program

86.6%

73

Corporate
Governance

Board of Directors and Committees
Composition and Operational Status of the BODs
Amorepacific Group and Amorepacific have formed the Board of
Directors to have a sound governance structure, and pursue thecompany’s sustainable growth and stakeholder value creation
through the BOD operations. The BOD consists of a majority
of independent directors, performing functions independentlyof management and controlling shareholders. Independent
directors are recommended by the Independent Director
Nomination Committee in consideration of the candidates’
independence, diversity, and expertise, and are individually
appointed by a general shareholders’ meeting. The term of the
BODs is determined by a resolution at the general shareholders’meeting, within the range of three years for internal directors andbetween one to three years for independent directors according
to the company’s articles of incorporation. The minimum
attendance in the Board meetings required by the BODs is 50%,
and the average attendance in meetings held by the Board of
Directors in 2022 was 97%.
Corporate Governance, Articles of Incorporation, and Rules(in Korean)

Securing Independence, Expertise, and Diversity of
the BODs

Amorepacific Group and Amorepacific have establishedsound governance structures through transparent andefficient Board operations, and pursue sustainablegrowth of the company and increased shareholder
value.

Amorepacific Group and Amorepacific have adopted various
measures to secure independence, expertise, and diversity of
the BODs. To enhance independence, the BOD is composedof a majority of independent directors. The appointment of
independent directors is made through the process of verification
and recommendation of candidates by the Independent
Director Nomination Committee, which consists entirely of
independent directors. The director appointment process follows
the ‘Guidelines for the Independence of Directors,’ and at thesame time meets the qualification requirements for directors

as prescribed by related laws such as the Commercial Act. In
addition, we appoint directors with practical experience andexpertise without discrimination based on gender, region,
academic background, disability, nationality, race, or cultural
background in accordance with our ‘BOD Diversity Guidelines.’ Inparticular, we appoint external experts with independence andbroad expertise in various fields such as accounting, management
strategy, foreign affairs, marketing, fair trade, and ESG as
independent directors to enhance the expertise of the Board andthe Committees under the BOD.

Committees

Role

Audit
Committee

Monitoring of the company’s accounting andoperations, approval of financial statements andbusiness reports, evaluation of internal accounting
management systems, appointment of external
auditors, etc.

Independent
Director
Nomination
Committee

Nomination of candidates for independent directors tobe appointed at the general shareholders’ meeting, etc.

BOD Evaluation and Remuneration

Internal
Transaction
ReviewCommittee

Deliberation and resolution on internal transactions, asprescribed by the Monopoly Regulation and Fair Trade
Act and the Commercial Act as matters to be approvedby the BODs

Compensation
Committee

Evaluation and deliberation on the adequacy of the
remuneration limit for registered directors, which is tobe submitted by the BODs to the general shareholders’meeting

Management
Committee

General management matters delegated by the BODs

Risk
Management
Committee

Prevention of emerging risks, response upon theoccurrence of risks, implementation of measures toprevent recurrence after the risk is contained

ESG Committee

Supervise and respond to ESG risks, such asexternal regulations, respond to ESG stakeholder
communications, develop ESG strategies and review
detailed action plans, and monitor implementation of
ESG-related plans, etc.

All directors, including independent directors, conduct an annual
evaluation of the BOD’s activities to strengthen accountabilityof the BOD and improve its efficiency. To ensure fairness, theevaluation items are organized according to BOD evaluation
guidelines stipulated by the Korea Institute of Corporate
Governance and Sustainability. The Board’s remuneration isdetermined after considering the size of the company and the levelof remuneration in the same industry. Amorepacific Group andAmorepacific are planning to review whether they will reevaluate
independent directors based on their individual performanceand consider these reevaluation results when deciding on theirpotential reappointment and possible remuneration.
Guidelines for the Independence and Diversity of the (Board of)
Directors

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. To operate the BODs and its
Committees efficiently and reasonably, each committee consistsof a members with backgrounds and expertise appropriate totheir key functions.

74(As of April 2023, ●: Chairman, ○: Member)

Composition of Amorepacific Group BOD
Category

Internal
Directors

Name

Position

Gender Date of
the First
Appointment

Suh
Kyung-bae

CEO, Amorepacific GroupM

1994.03

Lee
Sang-mokPresident, Amorepacific
Group

M

2023.03

Independent Choe
Directors
Jong-hak

Professor, College ofBusiness Administration,
Seoul National UniversityM2019.03

Professor, Department of
Business Administration,
Korea UniversityM

Kim Eon-soo

Lee Eun-jung CEO, LINE Plus
Chae Kyu-ha

Committees under the BOD

Category

○

●

○

○

●

○

●

●

Internal
Directors○○

2020.03○○○2023.03

Advisor, Law Firm Bae, Kim M& Lee (BKL)

2023.03

Position

Gender Date of
the First
Appointment

○
○

○

○

Suh Kyungbae

CEO, AmorepacificM2006.06

Kim Seung- CEO, AmorepacifichwanM2023.03

Lee Dongsoon

CEO, AmorepacificM2021.03

Park Jongman

Vice President, Digital Strategy M
Unit, Amorepacific2023.03

Lee Hwiseong

Senior Advisor, Innovative
Company Shall We

M2019.03

Jo Seong-jin Professor, College of Economy, M
Seoul National University

2021.032022.03○○

Kim Jongdae

Professor, Department of
Business Administration, Inha
University

M

Ahn Heejoon

Professor, Department of
Business Administration,
Sungkyunkwan University

M

Choe In-a

CEO, Choi Ina Books

F

2022.03F

2023.03

Lee Jae-yeon Executive, Marketing andRetail Sales, ROYAL CANIN

Board Skills Matrix of the Amorepacific Group’s BOD
Experience and Expertise

Suh Kyung-bae

Accounting·FinanceBusiness Management·Strategy
Marketing·Consumer
Fair Trade·Regulation·Compliance○

Lee Sang-mok

Choe Jong-hak○○

Committees under the BOD
Internal
Audit
Independent
Transaction
Committee
Director
Review
Nomination
Committee Committee

Compensation
Committee

○

○

ESG
Committee

Management
Committee

Risk
Management
Committee

○

○

●

●

○

○

○

○

○

○

●
Independent
Directors

F

Name

ESG
Compensation Management
Risk
Internal
Audit
Independent
Committee
Committee Management Committee
Transaction
Committee
Director
Committee
Review
Nomination
Committee Committee○(As of April 2023, ●: Chairman, ○: Member)

Composition of Amorepacific BOD

Kim Eon-soo

Lee Eun-jung

○

●

○

○

○

○

○

Board Skills Matrix of Amorepacific’s BOD

Chae Kyu-ha

Experience and Expertise

Kim Seunghwan●

2022.03●(As of April 2023)

Suh Kyungbae

○

○

○

○
○

○

(As of April 2023)

Lee Dongsoon

Park Jongman

Lee Hwiseong

Jo Seong-jin Kim Jong-dae Ahn Hee-joon

Business Management·Strategy

○

○

○

○

EconomyIT·Digital
ESG

○

○

○

Marketing·Consumer○

Lee Jae-yeon○

Accounting·Finance○

Choe In-a

○

○
○

75

Enhancing Shareholder Value

Amorepacific Group Shareholders
Category(As of Dec. 31, 2022, %)Proportion

Stock and Capital Structure
Amorepacific Group and Amorepacific adhere to the principleof one vote per share, ensuring fair treatment for shareholders.
As of December 31, 2022, the total number of ordinary shareswith voting rights is 58,443,694, and the number of ordinary
shares without voting rights (treasury shares) is 49,065. Basedon the same date, the major shareholders of Amorepacific’scommon stocks are Amorepacific Group 38.0%, Suh Kyungbae 10.6%, National Pension Service 7.4%, and others 44.0%.

Suh Kyung-bae

53.8

National Pension Service

7.2

Others39.0

Amorepacific Shareholders
Category(As of Dec. 31, 2022, %)Proportion

Amorepacific Group

38.0

Suh Kyung-bae

10.6

National Pension Service

7.4

Others44.0

Shareholder Return Policy
Amorepacific Group and Amorepacific have established ashareholder return policy and communicate regularly withshareholders to enhance shareholder value. Amorepacificdisclosed its mid- to long-term dividend policy in January 2020,
stating its plans to expand its consolidated dividend payout
ratio to 30% within three years, while staying within the 40%
limit of its annual Free Cash Flow and ensure stable dividends.
Following this policy, dividends have been paid every year, andas of 2022, Amorepacific’s dividend payout ratio reached its
strategic target of 34.9%.
Moreover, we are striving to enhance shareholders’ value by
acquiring treasury stocks. Amorepacific purchased treasury
stocks worth KRW 100 billion in 2019 to stabilize stock prices,
and acquired an additional KRW 20 billion worth of treasury
stocks in 2021 for employee compensation program.
Additionally, we are reinvesting cash generated from domestic
and international business activities to concentrate on core
operations, and to secure future growth potential throughM&A etc. As part of the strategy, Amorepacific acquired theNorth American clean beauty brand ‘Tata Harper’ in 2022,
creating a foundation to strengthen its brand portfolio andbusiness competitiveness. In the long run, we aim to increase
profit available for dividend and enhance shareholder value
by improving investment efficiency and achieve sustainablegrowth with our aforementioned strategy.

Protection of Shareholders’ Rights and Interests andStrengthening Communication
Amorepacific Group and Amorepacific are providing sufficient
information regarding Annual General Shareholders’ Meeting,including the shareholder proposal process, through our
website. To encourage active shareholder participation, we
have introduced electronic voting and actively promote proxyvoting to support shareholders in exercising their voting rights.
Furthermore, we pursue active communication with domestic
and international shareholders and investors through diverse
channels. The earnings release are prepared and disclosed
every quarter to communicate provisional business results, andonline and offline IR meetings are held on a regular basis fordomestic and international investors. In 2022, Amorepacificattended a total of 28 Non-Deal Roadshow (NDR) and investor
conferences hosted by domestic and international securities
firms, to communicate transparently and clearly about our
performance, future plans, and outlook. We also held Investor
Day to provide opportunities for communication between
investors and the CEO and present our business strategy
direction. Additionally, we hosted Analyst Day to conduct
discussions with management in the strategy division andresearchers, aiming to increase investors’ understanding andbuild trust.

76

Risk Management

Strengthening Risk Management
Risk Management System

Risk Management Process
Detection and Prevention of Risk

Amorepacific Group has established a system to identify andeffectively respond to domestic and international risks that may
have an impact on our financial and non-financial performance.
We operate a Group-wide Risk Management Committee,
consisting of top executives to allow prompt decision-making
related to risk management and response activities. The
Group Planning Team serves as the risk management control
center for Amorepacific Group. The Team communicates with
subcommittees in each issue area to monitor operational risks anddevise response strategies. Furthermore, the risk management
system of overseas subsidiaries has been enhanced to establish arobust foundation for global risk response management.

Identification of Key Risks· Analysis of internal and external business environments· Prioritizing risks based on their impact and likelihood of
occurrence
Establishing a Preventive System· Identifying the root causes of each risk
· Preparing proactive risk response

Board of Directors
Risk Management Committee
CRO (Risk Dedicated Executive)
Compliance TeamGroup Planning Team

Amorepacific Group operates an effective risk
management organization to minimize the impact
of potential risks that may arise in its business
operations. We continuously identify financial andnon-financial risks through ongoing risk identification
activities, and respond to these identified risks throughthorough proactive management activities.

· Risk Management Control Center for the APG· Establish risk management policies andstandards· Monitor operational risks· Perform risk assessments and devise response
strategies

Subcommittees· Communications/Quality Management/SHE/
Mutual Growth/R&I Unit Risk Management
Subcommittee· Manage ethics andcompliance risks

Amorepacific Group categorizes risks identified through its risk
management process into six categories and manages themaccordingly. Particularly, factors that can significantly impact
the company’s reputation and ethical and legal matters arehandled separately. Sensitivity tests are conducted to analyze
potential risk types for key risk factors.

Risk

Risk Type

Market Risks· Strengthened global regulations on safety andenvironment· Diversification of customer needs· Increased risk of natural disasters and major
incidents

Product Risks· Increased importance of product safety verificationand hazardous substance management· Establishment of measures to prevent recurrence ofcustomer complaints

Risk Response
Establishment of a Unified Risk Response System· Designation of a risk management officers for each businessdivision· Monitoring risks related to each division· Immediate reporting and response to risk

Risk Governance

Major Risk Management

Risk Diagnosis and Recurrence Prevention
Minimizing the Ripple Effects of Risks· Implementing responses based on risk scenarios andmanagement regulations for each risk type
Establishing Measures to Prevent Risk Recurrence· Conducting cause analysis for occurred risks
Fostering an Effective Risk Management Organizational
Culture· Publishing a risk casebook· Conducting regular risk management education for external
directors (at least once a year)

Supply Chain Risks · Increased importance of demand forecasting
and timely supply management due to market
environmental changes· Fluctuations in the supply environment pertaining
to raw materials due to external influences· Risk of safety accidents
Sales andDistribution Risks· Increased need for operational efficiency consideringcountry-specific characteristics· Response to changes in the regulatory environment
for different sales and distribution channels· Rising distribution costs due to inflation

Privacy Protection · Increased digitalization of customer services
Risks· S trengthened regulations on personal dataprotection
Reputational Risks · Risks that can have a hugely detrimental impact on
the company’s reputation

77

Managing Major Emerging Risks

Risk

Type

Definition of Emerging Risks

Mitigating Actions

Amorepacific Group strives to identify various potential risks
that may arise in the course of running a cosmetics business. A
total of four major potential risks were identified in 2022, andthese potential risks are being addressed through proactive
management activities.

Incidents·
Accidents Caused
by Unpredictable
Disasters and Natural
Disasters

Environment

The term incidents and accidents caused by unpredictable disasters and natural disasters’ refers tosudden natural events or accidents caused by human actions that cannot be predicted or prevented
in advance. In other words, they are unpredictable and can cause significant human and material
damage and loss when they occurs.

Amorepacific Group has established plans and processes to prepare for incidents and accidents
caused by such unpredictable disasters and natural disasters. Additionally, safety regulations havebeen put in place to prevent such incidents, and relevant training is provided to employees. To
minimize physical and human damages and respond quickly in the event of unpredictable incidents
and accidents, an organization dedicated to safety integration (Safety and Health Center) has been
designated and the role of each department has been reestablished. In this way, we plan to improveand expand measures for the safety of our members.

Increased Export Costs
Due to the Adoption of
Carbon Border Tax byCountry

Environment

The EU countries are in the process of adopting carbon border tax system that requires thepurchase of carbon emission rights, similar to taxes, for carbon emissions generated during the
production process. 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, it is expected that Korea will
incur an additional tax burden of $1 billion or more annually. As of 2022, Amorepacific Group
exports products to numerous countries in Asia, Europe, and North America, raising concerns
about deterioration in price competitiveness due to increased production and export costs when
this carbon border tax is applied. that price competitiveness may worsen due to increased costs ofproduction and export when this carbon border tax is applied.

In order to proactively address climate crisis-related regulations in areas like the EU, AmorepacificGroup has strengthened its environmental assessment for its products. Furthermore, we measure
the environmental footprint of each product and have developed and adopted low-carbon
technologies to reduce the environmental impact of each product. Amorepacific Group was thefirst Korean company to participate in the EcoBeautyScore Consortium since 2021, a group madeup of global cosmetics companies and professional associations, jointly working on developing
environmental assessment methods and scoring systems for cosmetics.

Disruptions in the
Global Supply Chain
Due to Conflicts
between Countries

SocialThe global supply chains are intricately intertwined, and any disruptions in specific supply chains due
to conflicts between countries can significantly impact corporate management. Delays in customs
clearance may occur if the import of raw materials is affected by inter-country conflicts, particularly
when a high proportion of raw materials are imported from a specific country. Amorepacific Group
imports raw materials and packaging materials from diverse supply chains, and it anticipates aconsiderable negative impact on its profits and losses if production and distribution within these
supply chains face disruptions.

To resolve issues arising from conflicts between countries, Amorepacific Group monitors
quantitative market indicators at all times. In doing so, we are securing our price competitivenessas we respond to changes in supply and demand by increasing our reserve inventory levels for raw
materials. In addition, we are seeking to diversify our supply chain for raw materials by adapting to
the global situation. To minimize potential risks related to raw material supply chains, we manage
and identify items that could be subject to regulations and their associated risks by manufacturer, as
well as monitor trends among countries.

Changes in the
population structureleading to shifts inmarket customers

Social

Korea is experiencing rapid demographic changes due to the acceleration of low birth rates and an
aging population. These demographic changes may lead to a decrease in the natural population andthe working-age population, posing a potential risk of low growth in the future. In the case of Japanesemarket, which has already entered an aging society, both the overall sales volume and amount ofshampoo sales have been decreasing gradually over the past decade. In response to these demographic
changes, such as a decrease in 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 tocome up with new business models and respond proactively to the issues.

Amorepacific Group is making efforts to enhance its business competitiveness in markets where low birthrates, aging populations, and population decline are expected to intensify. We are also developing highly
functional innovative products for active senior consumers and accelerating research on the developmentof customized cosmetics and health functional foods that take into account individual skin and healthconditions as well as individual preferences.

78

Tax Risk Management Strategy

Amorepacific Tax Payment Status1)

Amorepacific Group complies with the Commercial Act andall laws and regulations concerned with taxes in Korea as well
as jurisdictions in which it operates, and we are committed tofulfilling all our tax-related obligations. Amorepacific Group
strives to contribute to the local communities through paying
its fair share of taxes in a transparent manner.

CategoryIn our transactions with overseas subsidiaries, we haveestablished and implemented a transfer pricing policy inaccordance with domestic tax laws and OECD Transfer Price
Guidelines, ensuring adherence to the arm’s length principle.
We actively utilize the Advance Pricing Arrangement toeffectively address potential risks of double taxation.
Moreover, as part of the Base Erosion and Profit Shifting (BEPS)
project aimed at preventing tax avoidance by multinational
companies, we annually submit the “International Transaction
Integrated Report” to relevant authorities. We refrain from
exploiting differences in tax structures or rates between
countries to evade tax burdens and instead ensure thattaxable income is allocated appropriately based on the value
generated in each country where we operate. Furthermore,
we strictly limit any income transfer or use of tax havens withquestionable tax jurisdiction. These principles are carefully
examined by the Board of Directors, and we conduct annual
monitoring to ensure full compliance with tax regulations andpayments in each country of operation.

(Million KRW)

2021

2022

Earnings before tax2)

297,877

224,494

Corporate tax expenses

117,020

95,230Cash taxes paid

17,546

124,916

Tax Payment Status by Tax Jurisdiction3)(Million KRW)

Category

85,867China (Mainland)

5,432

Thailand810

Malaysia

731

Singapore

470

Vietnam

332

India

3

1) T
 he difference between reported taxes and cash taxes paid is causedby specific matters such as M&A and adjustments requested. For more
information, see the Consolidated Statements of Comprehensive Income andthe Consolidated Cash Flow Statement in the Audit Report’s Consolidated
Financial Statements.
2) Net income before deducting tax expense
3) E xcerpts from the Country-by-Country Report (CbCR), submitted annually to
the National Tax Service in accordance with the International Tax Adjustment
Act (based on the 2022 submission), show that there are no outstanding
corporate taxes except for those corporations for which the tax payment

Policies and Regulations for Ethical Management
Amorepacific Group has established corporate ethics andcompliance guidelines to respond to changes in ethical policies
and laws. Regular training is provided to employees to guidethem on compliance matters. This prevents unethical or illegal
behavior and eliminates possible risks.

Code of Ethics and Business Conduct Guidelines

Current Reported Taxes

Korea

period has not yet arrived.

EthicalManagement

Ethical Management System

Amorepacific Group’s Code of Ethics is a set of behavioral
guidelines that all our employees must comply with in orderfor us to enhance corporate transparency and fulfill social andethical responsibilities as a corporate citizen. Through the Codeof Ethics, Amorepacific Group provides clear guidance to all
employees on the principles for making morally sound workrelated decisions and sets standards for ethical behavior thatshould be followed in their private lives.
Code of Ethics

Amorepacific Group is promoting a healthy corporate
culture built on ‘Act with Integrity,’ one of theprinciples within the ‘ABC Spirit’. As a corporate
citizen, we fulfill our social and ethical responsibilities
by establishing and reviewing policies and guidelines
related to ethical management, conducting behavioral
guides, education, and awareness improvement
activities for executives and employees.

79Anti-Corruption Policy
Amorepacific operates anti-corruption policies to strengthen
trust with stakeholders and to continue sustainable growth.
The anti-corruption policy consists of five commitments,
including Amorepacific’s commitment to fostering a healthy
corporate ecosystem in collaboration with stakeholders andfulfilling its social role and responsibilities. In the first half of2023, Amorepacific obtained the ISO 37001 certification for its
anti-corruption management system. With this certification,
Amorepacific aims to solidify its commitment to anticorruption and ethical management culture, further increasing
the company’s credibility. Regular education and campaigns
are conducted with a view to preventing corruption, andan ethics management Hotline1) is available for employees
and stakeholders to report any concerns. Furthermore, we
conduct regular anti-corruption audits through internal audit
activities. The strict ban on corruption also applies to suppliers.
Amorepacific ensures that ethical pledges are signed bysuppliers during contract agreements. Moreover we comply
with the company’s principles regarding gifts, entertainment,
and other related matters in dealings with stakeholders.
This includes adhering to ethical guidelines, businessconduct guidelines, the guide on not giving or receiving gifts,
procedures for reporting the receipt of money and valuables,
and other relevant policies.

Amorepacific’s Anti-Corruption Policy1)	https://ethics.amorepacific.com

Ethical Management Activities
Employee Code of Conduct
The Code of Conduct represents a detailed illustration of how to practice the Code of Ethics and business conduct guidelines, and serves as a voluntary commitment that all employees should adhere to.

Workplace Sexual Harassment and Harassment
Prevention Guide

Live Broadcasting and Online Advertisement
Guide

Conflict of Interest Prevention Practice Guide

As a member of Amorepacific Group, the most important
ethical issue that must be prioritized is the prevention ofsexual harassment and the promotion of a healthy corporate
culture. This guide provides instructions on how to prevent
workplace harassment and is essential for maintaining a
positive work environment.

This guide provides information on fundamental principles
that should be adhered to in cosmetic marketing,including compliance with legal requirements and ethicalconsiderations for responsible marketing activities.

This preventive guide promotes a culture of fair work
performance by providing strict guidelines for making soundjudgments and avoiding conflicts between the company’s
interests and individual interests in situations where they
may clash.

Wholesome Get-together Culture Campaign(119 Principle)

No Gift Giving and Taking Campaign

Social Media Utilization Guide

In order to create a proper and healthy after-work dinnerculture, we have established a 119 dinner culture guide that
requires providing a notice one week before the day of dining
out, and concluding the first round by 9p.m.

To promote a healthy corporate culture, Amorepacific Group
members are instructed to return any gifts received to thesender. In cases where returning the gifts is not feasible,
members are advised to submit a Money and Valuables
Report to the Ethics Office.

As social media activities continue to grow for bothindividuals and businesses, this guide provides membersof Amorepacific Group with essential legal and ethicalstandards of conduct that they should adhere to in their workand personal spheres.

Trade Secret Protection Guide

Copyright Infringement Prevention Guide

Gentle AP (Power-tripping Prevention) Guide

This guide provides employees with necessary businessprocedures to protect and manage crucial internal
information vital to the company’s competitiveness, ensuring
the maintenance of our competitive edge.

To ensure proper use of copyrighted materials and prevent
unauthorized use of others’ works in the workplace, we
provide a guide on preventing copyright infringement.

The Gentle AP Guide provides instructions on theessential business manners that should be practiced whencollaborating with business partners, including suppliers andclients, to prevent any abuse of power.

80

Ethical Management Education

Global Spread of Ethical Consciousness

To enhance employees’ ethical awareness and prevent
unethical behaviors, Amorepacific Group conducts an annual
online ethics education based on the Amorepacific Cocd ofEthics. The curriculum covers important topics such as ethicalmanagement concepts, business conduct guidelines, andcompliance practices, aiming to internalize ethical awarenessamong employees. In 2022, we conducted online training
courses on conflicts of interest, protection of company assets,
and fair trading relationships. In particular, to enhancecompliance awareness, we conducted monthly education on
the key aspects of fair trade laws, such as the Fair Trade Act,
Subcontracting Act, and Distribution Act, for all employees.

Campaign Activities

All members of Amorepacific Group and Amorepacific(Executives, general employees, office staffs, technicians,
and contract employees) are required to undergo training.
In addition, we provide specialized ethics training for new
employees, new executives, and employees dispatchedoverseas, encouraging them to practice ethical management
according to their specific roles in the workplace.

In order to continuously educate and communicate with
employees on ethical conduct, we carry out business ethics
campaigns at all times. Leading examples include our ‘No
Gift Sharing campaign,’ the ‘119 Principle’ for an appropriate
culture of after-work dinners, and the ‘Gentle AP (Powertripping Prevention) Campaign.’
Amore Ethics Briefs
To make it easy for employees to experience the importanceof ethical management in their daily lives, a corporate ethics
newsletter called ‘Amore Ethics Briefs’ is published through theworkplaces. By sharing content based on internal and external
trends and actual cases, we raise the ethical awareness of ouremployees and prevent unethical behaviors from happening
again or at all. In 2022, we covered embezzlement andinappropriate practices, and what to follow when developing
advertising campaigns.
Expansion of Global Ethics Management

Completion Rate of Online Ethics Education
Amorepacific Group

86.6

%

Amorepacific

86.1

%

Rate of Participation for Pledge of Business Ethics1)
Amorepacific Group

91.2

%

Amorepacific

91.1

%

1)	Amorepacific Group’s members are required to sign ethics pledges in
employment contracts when they join the company. The above rate of ethicalpledge is the percentage of employees who voluntarily re-signed the pledge
as part of the annual campaign to strengthen their ethical awareness.

As part of our initiative to improve ethical practice of overseas
subsidiaries and prevent external risks globally, we conduct
corporate ethics programs at home and abroad. The head ofeach subsidiary regularly shares corporate ethics messages
with employees, and employees commit to implementing themthrough ethics pledges. Additionally, we conduct campaigns
on specific corporate ethics issues by season according to theguidelines provided by the headquarters, and conduct an‘Ethics Awareness Survey’ to objectively evaluate members’
perceptions of ethical management for all domestic andoverseas subsidiaries. Based on the survey results, additional
education and campaigns are conducted to prevent risks ofunethical conduct.

In 2022, based on the results of the ethics survey, we
strengthened our ethical awareness by conducting a campaign
on respect for employees and a culture of transparency insubsidiaries across 11 countries located in APAC and North
America.

Report on Unethical Behavior
Amorepacific Group operates ‘Ethics Hotline,’ an official
website for stakeholders to seek consultation on ethicalmanagement and report incidents involving unethical conduct.
The informant can report anonymously, and the information is
kept strictly private. In addition, the informant is not required
to disclose his or her identity without his or her consent, and heor she is not subjected to any disadvantages or discriminatory
actions for reporting. Amorepacific Group will take allnecessary measures to prevent any negative consequences forthe informants.
We are conducting fact-finding investigations on reports
received through the ‘Ethics Hotline,’ and taking disciplinary
measures and improving work processes and systems for cases
where unethical behavior has been confirmed. Furthermore,
major unethical practices are shared with employees every
year to prevent recurrence. In 2022, we completed action
on all 12 reports of unethical conduct that were confirmed
as a result of the investigation, including sexual harassment
at work and workplace harassment, private use of company
assets, and violation of work processes.

No Gift Giving and Taking Campaign

81

Chapter 4

ESG Factbook

82

Financial
Performance(KRW)

Consolidated Statements of Financial Position
Category

Amorepacific Group
2022

Assets2022

2021

3,015,471,536,393

1,735,019,347,862

2,018,526,858,100

Cash and cash equivalents

650,066,004,916

870,595,030,191

449,597,948,392

537,693,630,647

Financial deposits

206,069,238,000

316,825,500,000

74,669,238,000

101,825,500,000

Financial assets at fair value through profit or loss

754,007,356,956

863,824,272,415

362,939,892,414

490,839,332,272

Financial assets at amortized cost

59,534,958,905

0

30,000,000,000

0Trade receivables

300,982,900,966

311,950,819,896

285,104,514,893

295,769,466,239

Other receivables

65,948,981,162

38,438,533,784

62,646,902,451

41,647,242,846

Current tax assets

3,140,637,840

8,430,944,691

1,589,648,122

3,330,887,323

Other current assets

46,721,996,367

58,525,168,234

39,587,746,609

50,130,929,669

Inventories

459,962,411,412

542,815,041,075

408,934,396,533

493,223,642,997

Non-current assets as held for sale

19,949,060,448

4,066,226,107

19,949,060,448

4,066,226,107

5,084,620,254,482

5,022,671,395,732

4,066,763,830,297

4,098,187,074,812

Financial deposits

27,176,341,368

24,032,306,500

21,989,149,194

19,512,730,100

Other receivables

70,579,095,189

126,171,027,335

66,737,893,651

115,162,575,008

Financial assets at fair value through profit or loss

32,195,524,841

226,132,645,101

8,017,318,251

104,256,383,649

430,315,000

1,965,804,982

430,315,000

811,274,982

Financial assets measured at fair value through other comprehensive income

224,477,932,645

5,410,059,694

6,216,765,880

4,672,325,200

Property, plant, and equipment

2,820,687,110,864

2,919,950,211,189

2,475,276,690,492

2,541,362,150,975

Intangible assets

856,377,167,180

703,436,882,751

357,750,954,252

201,680,029,794

Investment property

314,918,090,772

344,130,029,556

503,268,138,559

534,228,580,408

Right-of-use assets

115,856,189,029

164,554,887,994

128,492,275,394

146,465,714,306

Investments in associates

329,967,791,735

282,307,314,107

247,279,224,799

238,445,368,790

The net defined benefit assets

209,903,459,545

109,592,951,296

181,406,890,326

94,729,521,034

Deferred tax assets

69,558,739,123

101,017,034,504

57,853,971,328

84,608,399,877

Other non-current assets

12,492,497,191

13,970,240,723

12,044,243,171

12,252,020,689

7,651,003,801,454

8,038,142,932,125

5,801,783,178,159

6,116,713,932,912

Current liabilities

851,901,945,315

1,273,284,869,946

831,116,935,949

1,157,485,393,842

Non-current liabilities

265,598,515,176

289,233,283,898

191,391,138,151

214,928,661,448

Total liabilities

1,117,500,460,491

1,562,518,153,844

1,022,508,074,100

1,372,414,055,290

Controlling invest equity

3,356,370,904,773

3,306,537,801,345

4,798,613,296,098

4,761,008,405,615

Share capital

47,997,075,000

47,997,075,000

34,525,294,500

34,525,294,500

Share premium

903,820,398,139

903,711,140,730

720,480,827,092

720,480,827,092

Capital surplus(213,214,348,245)(209,370,231,412)

71,118,560,015

75,352,826,661

Other components of equity(195,095,986,788)(195,102,638,526)(18,139,434,036)(19,004,134,338)

31,088,989,500(2,561,687,886)(19,458,512,997)

11,879,036,721

2,781,774,777,167

2,761,864,143,439

4,010,086,561,524

3,937,774,554,979

Non-controlling interests

3,177,132,436,190

3,169,086,976,936(19,338,192,039)(16,708,527,993)

Total equity

6,533,503,340,963

6,475,624,778,281

4,779,275,104,059

4,744,299,877,622

Financial assets at amortized cost

Total assets

Equity2021

2,566,383,546,972

Current assets

Non-current assets

Liabilities

AmorepacificAccumulated other comprehensive income
Retained earnings

83

Consolidated Statements of Comprehensive Income(KRW)

Category

Amorepacific Group
2022

Amorepacific
2021

2022

2021

Revenue

4,494,956,806,652

5,326,080,007,289

4,134,932,512,111

4,863,128,496,699

Cost of sales

1,347,786,580,983

1,461,565,391,981

1,337,512,406,849

1,362,639,202,428

Gross profit

3,147,170,225,669

3,864,514,615,308

2,797,420,105,262

3,500,489,294,271

Selling and administrative expenses

2,875,269,513,268

3,508,343,341,758

2,583,186,849,501

3,157,131,485,221

Operating profit

271,900,712,401

356,171,273,550

214,233,255,761

343,357,809,050

Finance income

52,512,453,332

21,061,314,624

22,771,702,594

10,499,109,599

Financial costs

57,934,533,676

14,322,950,770

34,413,883,142

11,410,260,207

Other non-operating losses, net

10,097,992,018

61,004,430,682

13,044,673,857(45,496,828,367)

Share of net profit of associates

11,801,765,440

5,660,108,316

8,858,020,099

927,626,457

Profit before income tax

288,378,389,515

429,574,176,402

224,493,769,169

297,877,456,532

Income tax expense

139,155,976,754

137,595,329,986

95,229,524,211

117,019,762,555

Profit for the year

149,222,412,761

291,978,846,416

129,264,244,958

180,857,693,977

Owners of the parent company

62,237,028,846

179,995,030,205

134,474,812,450

193,680,578,727

Non-controlling interests

86,985,383,915

111,983,816,211(5,210,567,492)(12,822,884,750)

Actuarial loss on postemployment benefit obligations

6,369,293,492(57,633,335,747)

5,482,640,916(47,369,483,250)

Financial assets at fair value through other comprehensive income

42,649,600,239

307,763,192(31,630,608)

109,285,659(265,529,263)

227,434,393(606,664,733)

260,637,659(31,919,926,666)

31,359,475,764(31,891,807,328)

31,358,419,049

Other comprehensive income (loss) for the period, net of tax

16,833,437,802(25,738,662,398)(27,047,461,753)(15,641,140,883)

Total comprehensive income for the year

166,055,850,563

266,240,184,018

102,216,783,205

165,216,553,094

Owners of the parent company

95,507,472,449

165,405,660,706

108,599,005,752

178,468,780,329

Non-controlling interests

70,548,378,114

100,834,523,312(6,382,222,547)(13,252,227,235)

Basic earnings per ordinary share

657

1,989

1,949

2,820

Basic earnings per preferred share

662

1,994

1,954

2,821

Profit attributable toPost-tax other comprehensive income (loss)
Items that will not reclassified to profit or loss

Items that may be reclassified to profit or loss
Share of other comprehensive income of associates
Gain or loss on currency translation of foreign operations

Attributable toEarnings per share attributable to owners of the parent company

84

ESG Data

Environmental Performance
GHG Emissions1), 2) - Amorepacific Group
Category

Unit

2020

2021

2022

Total emissions (Scope 1, 2, 3)

tCO2e

665,723

583,115(581,506)

555,039(553,482)

tCO2e

13,174

12,981(11,373)

12,421(10,863)

Amorepacific (Domestic)

tCO2e

8,978

8,380

7,825

Amorepacific (Shanghai) 3), 4)

tCO2e

703

1,608
(0)

1,652
(94)

COSVISION

tCO2e

658

768

739

OSULLOC Farm

tCO2e

2,416

1,896

1,928

innisfree5)

tCO2e

n/a

n/a

81

Amorepacific Group others6)

tCO2e

420

328

196

tCO2e

46,74940,10632,344

Amorepacific (Domestic)

tCO2e34,12033,60324,151

Amorepacific (Shanghai)

tCO2e

6,620

0

929

COSVISION

tCO2e

2,785

3,306

3,325

OSULLOC Farm

tCO2e

1,187

1,187

1,211

innisfree

tCO2e

n/a

n/a

1,251

Amorepacific Group other

tCO2e

2,037

2,010

1,476

tCO2e

605,801

530,027

510,274

1. Purchased goods & services

tCO2e

250,413262,258

184,793

2. Capital goods

tCO2e

570

420

7,168

3. Fuel- and energy-related activities

tCO2e

1,008

994

932

4. Upstream transportation and distribution

tCO2e

3,427

3,682

2,638

5. Waste generated in operations

tCO2e

2,890

2,381

1,798

6. Business travel

tCO2e

787

417

799

7. Employee commuting

tCO2e

3,143

2,472

2,491

9. Downstream transportation and distribution

tCO2e

4,063

7,013

5,247

11. Use of sold products

tCO2e

303,038

217,525

284,720

12. End-of-life treatment of sold products

tCO2e30,94527,243

13,386

13. Downstream leased assets

tCO2e

5,517

5,623

6,301

tCO2e/ton of product

0.59

0.49

0.58

Scope 1 Emissions

Subtotal
Emissions by business site

Scope 2 Emissions

Subtotal
Emissions by business site

Scope 3 Emissions

Subtotal
Emissions by category1)	The above GHG emissions were rounded to the nearest decimal place andcalculated retrospectively based on the scope of subsidiary companies for theyear 20222)	Data in parentheses indicate emissions reflecting offset performance from thepurchase of Certified Emission Reduction (CER)3)	In the case of Scope 1 emissions from Amorepacific Shanghai production site in
2021 and 2022, we offset the emissions by purchasing offset emission rights(CER), achieving carbon neutrality at Amorepacific Shanghai production site4)	Amorepacific(Shanghai)’s 2020-2021 data collection range was limited to
production plants (1,2,3), and from 2022, headquarters, R&I Center, andlogistics will be included5)	The GHG emissions data for innisfree has been collected from 20226)	‘Amorepacific Group others’ include AMOS Professional, Amorepacific Empathy
Foundation, Amorepacific Foundation, OSULLOC, BBDO Korea, Suh Kyung-bae
Science Foundation, ETUDE, espoir

GHG Emission intensity

Emission intensity (Scope 1 and 2)

85

GHG Emissions1), 2) - AmorepacificCategory

Unit

2020

2021

2022

Total emissions (Scope 1, 2, 3)

tCO2e

662,120580,031550,276(578,423)(548,718)

10,756

10,216(9,148)(8,658)

Scope 1 Emissions

Subtotal
Emissions by business site

tCO2e
Amorepacific (Domestic)

tCO2e

8,978

8,380

7,825

Amorepacific (Shanghai) 3), 4)

tCO2e

703

1,608

1,652

(0)

(94)

768

739

COSVISION

Scope 2 Emissions

658

8,764

tCO2e

Subtotal

tCO2e43,52536,90928,405

Amorepacific (Domestic)

tCO2e34,12033,60324,151

Amorepacific (Shanghai)

tCO2e

6,620

0

929

COSVISION

tCO2e

2,785

3,306

3,325
35,3592022 Goal

tCO2e

Subtotal

tCO2e608,257

532,366

511,655

1. Purchased goods & services

tCO2e

250,413262,258

184,412

2. Capital goods

tCO2e

570

420

7,168

3. Fuel- and energy-related activities

tCO2e

1,008

994

932

4. Upstream transportation and distribution

tCO2e

3,427

3,682

2,638

5. Waste generated in operations

tCO2e

2,890

2,381

1,798

6. Business travel

tCO2e

787

417

799

7. Employee commuting

tCO2e

3,143

2,472

2,491

9. Downstream transportation and distribution

tCO2e

4,063

7,013

5,247

11. Use of sold products

tCO2e

303,038

217,525

284,720

12. End-of-life treatment of sold products

tCO2e30,94527,243

13,344

13. Downstream leased assets

tCO2e

7,973

7,961

8,105

tCO2e/ton of product

0.54

0.44

0.51

Emissions by category

GHG emission intensity

tCO2e2022 Goal

Emissions by business site

Scope 3 Emissions

10,339Emission intensity (Scope 1 and 2)

1) The above GHG emissions were rounded to the nearest decimal place and calculated retrospectively based on the scope of subsidiary companies for the year 2022
2) Data in parentheses indicate emissions reflecting offset performance from the purchase of Certified Emission Reduction (CER)3)	In the case of Scope 1 emissions from Amorepacific Shanghai production site in 2021 and 2022, we offset the emissions by purchasing offset emission rights (CER), achieving carbon neutrality at Amorepacific Shanghai production site4) Amorepacific(Shanghai)’s 2020-2021 data collection range was limited to production plants (1,2,3) and from 2022, headquarters, R&I Center, and logistics will be included

86

Energy Consumption1) - Amorepacific Group
Category

Energy Consumption1) - Amorepacific
Unit

2020

2021

2022

Category

Unit

2020

2021

2022

EnergyTotal energy consumption

TJ

608

617

595

EnergyTotal energy consumption

TJ

538

556

529

consumption

Consumption by

Amorepacific (Domestic)

TJ

456

458

431

consumption

Consumption by

Amorepacific (Domestic)

TJ

456

458

431

business site

Amorepacific (Shanghai)2)

TJ

48

57

57

COSVISION

TJ

34

41

41

Amorepacific (Shanghai)2)

TJ

48

57

57

innisfree3)

TJ

n/a

n/a

11

COSVISION

TJ

34

41

41

OSULLOC Farm

TJ

46

38

39

Subtotal

TJ

204

199

187

Amorepacific Group others4)

TJ

24

23

15

Amorepacific (Domestic)

TJ

175

164

153

Fuel

Subtotal

TJ

249

235

222

Amorepacific (Shanghai)

TJ

16

20

19

Amorepacific (Domestic)

TJ

175

164

153

COSVISION

TJ

13

15

15

Amorepacific (Shanghai)

TJ

16

20

19

Subtotal

TJ

318

290

223

COSVISION

TJ

13

15

15

Amorepacific (Domestic)

TJ

265

264

189

Amorepacific (Shanghai)

TJ

32

0

8

COSVISION

TJ

22

26

26

Subtotal

TJ

16

67

119

Amorepacific (Domestic)

TJ

16

30

89

Amorepacific (Shanghai)

TJ

0.2

37

30

COSVISION

TJ

0

0

0

Type

TJ

n/a

n/a

2

OSULLOC Farm

TJ

37

29

29

Amorepacific Group others

TJ

8

Subtotal

TJ

343

314

254

TJ

265

264

189

Amorepacific (Shanghai)

TJ

32

0

8

COSVISION

TJ

22

26

26

innisfree

TJ

n/a

n/a

10

OSULLOC Farm

TJ

9

9

9

Amorepacific Group others

TJ

16

15

12

Subtotal

TJ

16

67

119

Amorepacific (Domestic)

TJ

16

30

89

Amorepacific (Shanghai)

TJ

0.2

37

30

COSVISION

TJ

0

0

0

innisfree

TJ

n/a

n/a

0

OSULLOC Farm

TJ

0

0

0

Amorepacific Group others

TJ

0

0

0

0.006

0.006

0.008

innisfreeElectric power

Amorepacific (Domestic)

Renewableenergy5)

Energy intensity

TJ/ton of product7

business site

Type

Fuel

Electric power

Renewable

4energy5)2022 Goal
Energy intensity

533

TJ
TJ/ton of product

0.005

0.005

0.007

1)	The above GHG emissions were rounded to the nearest decimal place and calculated retrospectively based on the scope of subsidiary companies for the year 20222)	In the case of Scope 1 emissions from Amorepacific Shanghai production site in 2021 and 2022, we offset the emissions by purchasing offset emission rights (CER),
achieving carbon neutrality at Amorepacific Shanghai production site3)	The GHG emissions data for innisfree has been collected from 20224)	‘Amorepacific Group others’ include AMOS Professional, Amorepacific Empathy Foundation, Amorepacific Foundation, OSULLOC, BBDO Korea, Suh Kyung-bae Science
Foundation, ETUDE, espoir5)	Includes energy generated through hydropower, solar power, solar thermal power, wind power, geothermal power, and bioenergy

87

Water Resource Management - Amorepacific Group Production Sites
Category
Water

Total water withdrawal

Water Resource Management - Amorepacific Production Sites

Unit

2019

2020

2021

2022

Category

ton

1,113,792

901,673797,271

762,865

Water

withdrawal

Unit

2019

2020

2021

2022

Total water withdrawal

ton

517,276475,653

556,455

473,346

Water

Municipal water (tap water)

ton

437,323401,243

487,016

408,587

Industrial water

ton

34,892

39,13330,322

25,223

withdrawal
Water

Municipal water (tap water)

ton

658,430

585,914499,500

408,747

withdrawal
by source of

withdrawal
Industrial water

ton

34,892

39,13330,322

25,223by source of

water

Water

water
Ground water

ton

381,971

243,024

230,393294,374

Ground water

ton

6,562

1,675

2,061

5,015

Rainwater

ton

38,49933,60237,05634,521

Rainwater

ton

38,49933,60237,05634,521

Amorepacific (Domestic)ton

425,897382,770

408,507

350,518

Amorepacific (Domestic)ton

425,897382,770

408,507

350,518

Amorepacific (Shanghai)ton

91,37992,88379,541

58,816

ton

n/a

n/a

68,40664,012

5.0

5.2

5.2

6.3

Water

withdrawal
by production

withdrawal
Amorepacific (Shanghai)ton

91,37992,88379,541

58,816by production

site

site
COSVISION

ton

71,772

57,78068,40664,012COSVISION2)OSULLOC Farm

ton

373,353

238,852

226,733

289,519

Intensity of water withdrawal

ton/ton of product

Others1)ton

151,391

129,388

14,083n/a2022 Goal (Rain water excluded)

ton

8.1

7.4

7.0

10.0

Total water recycling

ton

31,322

13,81535,82049,914

Water recycling rate

%

14.2

6.7

16.1

25.9

Water discharge

ton

296,566

270,517

333,484

280,702

Water consumption

ton

220,710205,136

222,971

192,644

Intensity of water withdrawal

ton/ton of productWater

497,584

recycling
Water

Total water recycling

ton

33,16916,02835,82049,914

Water recycling rate

%

5.2

3.2

7.7

10.4

Water discharge

ton

469,969

395,818

333,639

280,702

Water consumption

ton

643,823

505,855

463,632

482,163

recycling1)	Data before the sales of PACIFICPACKAGE(current Autajon Packaging Pacific) in 2022, and AESTURA’s data before the Amorepacific absorption-type merger in 2021 areclassifies as ‘others’
2) Reflected as Amorepacific consolidated basis since its acquisition by Amorepacific in 2021

88

Waste Disposal - Amorepacific Group Production Sites

Waste Disposal - Amorepacific Production Sites

Category

Unit

2019

2020

2021

2022

Category

Unit

2019

2020

2021

2022

Total waste disposal

ton

13,162

10,126

9,036

6,868

Total waste disposal

ton

10,249

7,774

8,817

6,866

ton

11,274

8,400

7,434

5,753

Waste

General waste1) Subtotal

ton

9,012

6,602

7,358

5,751

Recycling

ton

7,957

5,636

6,512

5,201

Incineration

ton

974

961

843

550

Landfill

ton

80

5

4

0

Subtotal

ton

1,237

1,172

1,459

1,115

Waste

Generaltreatment by

waste1)

type

DesignatedSubtotaltreatment by
Recycling

ton

9,704

7,045

6,512

5,201

Incineration

ton

1,488

1,348

917

551

Landfill

ton

82

7

5

0

Subtotal

ton

1,889

1,726

1,602

1,115

type

Designatedwaste1)waste1)

Waste

Recycling

ton

1,351

1,284

1,316

1,002

Recycling

ton

1,124

1,082

1,316

1,002

Incineration

ton

513

417

286

112

Incineration

ton

114

90

143

112

Landfill

ton

25

25

0

0

Landfill

ton

0

0

0

0

Others(neutralization)

ton

0

0

0.2

0.3

Others(neutralization)

ton

0

0

0.2

0.3

Recycling rate

%

84.0

82.3

86.6

90.3

Recycling rate

%

88.6

86.4

88.8

90.4

Amorepacific (Domestic)

ton

9,622

6,948

7,518

5,842

Amorepacific (Domestic)

ton

9,622

6,948

7,518

5,842

Amorepacific (Shanghai)

ton

627

826

742

589

COSVISION3)

ton

n/a

n/a

557

435

disposal bydisposal by
production

Waste

Amorepacific (Shanghai)

ton

627

826

742

589

production
site

site
COSVISION

ton

610

528

557

435

OSULLOC Farm

ton

2

2

1

2

Others2)

ton

2,302

1,822

217

n/a

Total waste disposal (2022 goal)

ton1) The entire waste is consigned2)	Data before the sales of PACIFICPACKAGE(current Autajon Packaging Pacific) in 2022, PACIFICGLAS’s data before its sales in 2021 (current VERSCENCE PACIFIC), and
AESTURA’s data before the Amorepacific absorption-type merger in 2021 are classifies as ‘others’
3) Reflected as Amorepacific consolidated basis since its acquisition by Amorepacific in 2021

948.6

89

Pollutant Generation - Amorepacific Group Production Sites
Category
Air pollutants

Water pollutants

Sustainable Product Development - Amorepacific Group

Unit

2019

2020

2021

2022

Dust

ton

2.2

1.5

1.4

1.0

SOx

ton

19.3

17.5

0

0

NOx

ton

22.7

20.0

9.1

4.4

TOC1)

ton

n/a

n/a

4.7

4.3

Pollutant Generation - Amorepacific Production Sites
Category
Air pollutants

Water pollutants

Category
Percentage of new sustainableproducts

Percentage of new products
implementing environmentally andsocially friendly attributes

Unit

2020

2021

2022

%

61.1

73.9

77.0

Unit

2020

2021

2022

%

71.7

88.0

90.5

Sustainable Product Development - Amorepacific

Unit

2019

2020

2021

2022

Dust

ton

1.5

0.8

1.2

0.9

SOx

ton

0

0

0

0

NOx

ton

10.3

9.6

9.1

4.4

TOC1)

ton

n/a

n/a

4.7

4.3

Category
Percentage of new sustainableproducts

Percentage of new products
implementing environmentally andsocially friendly attributes

1) For water pollutants, changed from COD to TOC to calculate emissions since 2021

90

Environmental Management Implementation - Amorepacific Group
Category
Environmental operations

Total

Environmental Management Implementation - Amorepacific

Unit

2019

2020

2021

2022

Category

100 million KRW

49.3

39.5

43.9

45.5

Environmental operations

and investments

Unit

2019

2020

2021

2022

100 million KRW

33.1

25.3

40.9

45.0

Operations

100 million KRW

24.1

22.9

32.6

32.6

Investments

100 million KRW

8.9

2.5

8.3

12.4

Case

0

0

0

0

0

0

0

0

%

n/a

4.8

2.8

2.9

%

n/a

20.5

42.8

64.1

Total

and investments
Type

Operations

100 million KRW

40.0

35.3

35.5

32.9

Investments

100 million KRW

9.3

4.2

8.4

12.6

Case

0

0

0

0

Environmental compliance1) Number of significant violation

Type

Environmental compliance1) Number of significant violationof environment related legalof environment related legal

obligations/regulations cases

obligations/regulations cases

Amount of significant violation 100 million KRW

0

0

0

0

Amount of significant violation 100 million KRWof environmental fines/of environmental fines/

penalties

penalties
Eco-friendly purchases andPercentage of eco-friendly

sales2)purchases
Percentage of eco-friendly
sales1) Calculated on a basis of fines and penalties of $10,000 or more for significant environmental violations
2) Calculated based on a separate basis for the domestic corporation of Amorepacific91

Social Performance
Domestic and Overseas Employment - Amorepacific Group

Domestic and Overseas Employment - AmorepacificCategory

Unit

2020

2021

2022

Category

Unit

2020

2021

2022

Total number of employees

Person12,387

11,171

10,010Total number of employees

Person10,945

10,106

9,091

Employees by

Domestic

Person

7,288

6,602

6,145

Employees by

Domestic

Person

5,846

5,537

5,226

regionOverseas

Person

5,099

4,569

3,865

regionOverseas

Person

5,099

4,569

3,865

Asia

Person

4,874

4,367

3,648

Asia

Person

4,874

4,367

3,648

North America

Person

156

139

156

North America

Person

156

139

156

Europe & Others

Person69

63

61

Europe & Others

Person69

63

61

Ratio of domestic employees

%

58.8

59.1

61.4

Ratio of domestic employees

%

53.4

54.8

57.5

Ratio of overseas Asia

%

39.3

39.1

36.4

Ratio of overseas Asia

%

44.5

43.2

40.1

employees

North America

%

1.3

1.2

1.6

employees

North America

%

1.4

1.4

1.7

Europe & Others

%

0.6

0.6

0.6

Europe & Others

%

0.6

0.6

0.7

Subtotal

Subtotal

Employees by

Male

Person

3,496

3,213

2,930

Employees by

Male

Person

2,774

2,783

2,561

genderFemalePerson

8,891

7,958

7,080

genderFemalePerson

8,171

7,323

6,530

Ratio of males

%

28.2

28.8

29.3

Ratio of males

%

25.3

27.5

28.2

Ratio of females

%

71.8

71.2

70.7

Ratio of females

%

74.7

72.5

71.8

Person

1,466

1,792

1,722

Person

1,167

1,537

1,493

Person

1,244

1,482

1,408

Person

945

1,227

1,179

Person

222

310

314

Person

222

310

314

Asia

Person

196

269

268

Asia

Person

196

269

268

North America

Person19

30

33

North America

Person19

30

33Europe & Others

Person71113Europe & Others

Person7

11

13

Ratio of domestic employees

%

17.1

22.4

22.9

Ratio of domestic employees

%

16.2

22.2

22.6

Ratio of overseas Asia

%

4.0

6.2

7.3

Ratio of overseas Asia

%

4.0

6.2

7.3

employees

North America

%

12.2

21.6

21.2

employees

North America

%

12.2

21.6

21.2

Europe & Others

%

10.1

17.5

21.3

Europe & Others

%

10.1

17.5

21.3

Male

Person

949

1,078

1,013

Male

Person

728

927

872

FemalePerson

517

714

709

FemalePerson

439

610

621

Ratio of males

%

64.7

60.2

58.8

Ratio of males

%

62.4

60.3

58.4

Ratio of females

%

35.3

39.8

41.2

Ratio of females

%

37.6

39.7

41.6

Managers

Total
RegionDomestic
Overseas

GenderSubtotal

Managers

Total
RegionDomestic
Overseas

GenderSubtotal

92

Domestic Employment - Amorepacific Group

Domestic Employment - AmorepacificCategory

Unit

2020

2021

2022

Category

Unit

2020

2021

2022

Total number of domestic employees

Person

7,288

6,602

6,145

Total number of domestic employees

Person

5,846

5,537

5,226

Permanent1)

Person

6,970

6,203

5,774

Employment status

Permanent1)

Person

5,606

5,228

4,940

Temporary2)

Person

318

399

371

Temporary2)

Person

240

309

286

Male

Person

2,607

2,417

2,228

Male

Person

1,885

1,987

1,859

FemalePerson

4,681

4,185

3,917

FemalePerson

3,961

3,550

3,367

< 30 years old

Person

1,743

1,289

1,016

< 30 years old

Person

1,399

1,027

805

30-50 years old

Person

5,248

5,041

4,835

30-50 years old

Person

4,216

4,268

4,153

> 50 years old

Person

297

272

294

> 50 years old

Person

231

242

268

Person

109

104

128

Person

109

102

121

Employment status

GenderAge group

Employees with disabilities

GenderAge group

Employees with disabilities

1) Executives included
2) Contract workers and interns included, but dispatched workers not included

93

Overseas Local Employment - Amorepacific Group, Amorepacific1)
Category
Local employment

Unit

2020

2021

2022

Category

Person

4,939

4,434

3,739

Ratio of female by job group2)

%

96.9

97.0

96.7

Asia

Person

4,737

4,244

3,532

North America

Person141

133

Europe & Others

Person61

Male

Person751

Number of local employees
Local employment ratio among overseas employees
RegionGenderDiversity - Amorepacific
Unit

2020

2021

2022

Revenue-generating positions

%

79.1

80.1

80.1

STEM-related positions

%

50.1

51.4

52.3

Total number of managers

%

37.7

39.9

41.9

150

Top managers

%

23.9

22.8

24.6

57

57

Junior-level managers

%

43.2

42.2

39.4

680

596

Managers with revenue-generating

%

n/a

39.4

42.0

%

90.2

89.2

95.1

Total

%

88.7

92.0

113.4

Base pay

%

98.3

96.8

96.2

Total

%

98.3

94.1

93.9

Total

%

95.8

96.7

88.1

Ratio of female managers2)

positions3)
FemalePerson

4,188

3,754

3,143
Equal pay4)

Local managers

Number of local managers

Person

130

207

215

Executive position Base pay(Ratio of wage forfemale compared to male)

Local employment ratio among overseas managers

%

58.6

66.8

68.5
Managerial

GenderMale
FemalePersonPerson

31
99

46
161

53

position162
Non-managerial
position1)	In the case of overseas local employment status, dispatched personnel were excluded. As all overseas subsidiaries are included within the Amorepacific consolidation scope,
the number of employees for Amorepacific Group and Amorepacific are identical2)	In the case of the proportion of women by job group and the proportion of women in managerial positions, it is calculated based on a separate basis for the domestic
corporation of Amorepacific and on a consolidated basis for the overseas corporation3)	The number of female managers with revenue-generating positions calculated since 2021
4)	In the case of current status of equal pay, Amorepacific is calculated based on a separate basis for the domestic corporation of Amorepacific94

Employee Hiring and Turnover - Amorepacific Group

Employee Hiring and Turnover - AmorepacificCategory

Unit

2019

2020

2021

2022

Category

Unit

2019

2020

2021

2022

New Hiring Total

Person

744

415

583

538

New Hiring Total

Person

490

305

426

392

Male

Person

126

89

127

88

Person

364

216

299

304

status1)

status1)
GenderMale

Person

182

112

162

138

FemalePerson

562

303

421

400

FemaleRatio of males

%

21.8

27.0

27.8

25.7

Ratio of males

%

25.7

29.2

29.8

22.4

Ratio of females

%

78.2

73.0

72.2

74.3

Ratio of females

%

74.3

70.8

70.2

77.6

< 30 years old

Person

535

264

409

360

< 30 years old

Person

346

192

290

258

30-50 years old

Person

197

142

165

172

30-50 years old

Person

132

105

132

129

> 50 years old

Person

12

9

9

6

> 50 years old

Person

12

8

4

5

Ratio of < 30 years old

%

71.9

63.6

70.2

66.9

Ratio of < 30 years old

%

70.6

63.0

68.1

65.8

Ratio of 30-50 years old

%

26.5

34.2

28.3

32.0

Ratio of 30-50 years old

%

26.9

34.4

31.0

32.9

Ratio of > 50 years old

%

1.6

2.2

1.5

1.1

Ratio of > 50 years old

%

2.4

2.6

0.9

1.3

Total Employee Turnover rate

%

6.8

13.6

6.2

8.5

Internal hiring rate for open positions2)

%

12.9

32.6

41.8

58.2

Voluntary Employee Turnover rate3)

%

5.4

4.9

4.4

7.1

Average hiring cost per employee2)

10,000 KRW

n/a

745

565

543

Total Employee Turnover rate

%

5.9

14.8

6.1

7.4

Voluntary Employee Turnover rate3)

%

4.7

4.4

4.1

6.1

Age group

Employee

GenderAge group

Turnoverstatus2)

Employee
Turnoverstatus2)

1) Calculated including both permanent and temporary employees2) Calculated on the basis of permanent employees
3) Voluntary Employee Turnover occurs when an employee voluntarily resigns regardless of the company’s intentions; it includes company transfer and resignation.

95

Employee Training and Development - Amorepacific Group

Employee Training and Development - AmorepacificCategory

Unit

2020

2021

2022

Category

Unit

2020

2021

2022

Total number of employees eligible for the training1)

Person

6,970

6,203

5,774

Total number of employees eligible for the training1)

Person

5,606

5,228

4,940

Total training hours

Hour

456,351

185,758

244,230

Total training hours

Hour

394,254

171,598

207,669

65.5

29.9

42.3

Average training

Training hours per person

Hour/Person

hours

Average training

Training hours per person

Hour/Person

70.3

32.8

42.0

Male

Hour/Person

n/a

n/a

45.2

FemaleHour/Person

n/a

n/a

41.9

< 30 years old

Hour/Person

n/a

n/a

42.0

hours
Gender2)

Age group2)

Average training cost per person

MaleHour/Person

n/a

n/a

44.8

FemaleHour/Person

n/a

n/a

40.8

< 30 years old

Hour/Person

n/a

n/a

40.8

30-50 years old

Hour/Person

n/a

n/a

43.5

30-50 years old

Hour/Person

n/a

n/a

43.0

> 50 years old

Hour/Person

n/a

n/a

26.3

> 50 years old

Hour/Person

n/a

n/a

27.1

10,000 KRW

600,894

361,902

298,048

10,000 KRW

674,958

367,533

304,524

Gender2)

Age group2)

Average training cost per person

1) Calculated in the basis of permanent employees
2) Average training hours by gender and age group calculated since 2022

96

Parental Leave - Amorepacific Group

Parental Leave - AmorepacificCategory
Number of employees

Total

Unit

2020

2021

2022

Category

Person

455

425

461

Number of employees

using parental leave
Male

Person24

1129

FemalePerson

431

414

432

Person

322

416

435

Total

work after parental leave
Male

Person20

11

26

FemalePerson

302

405

409

%

93.1

97.9

94.4

Total

after parental leave1)

2022

Person

383

363

401

Male

Person18

1024

FemalePerson

365

353

377

Person

271

354

379

Male

Person15

1022

FemalePerson

256

344

357

%

92.5

97.5

94.5

Male

%

88.2

100.0

91.7

Female

%

92.8

97.5

94.7

%

86.5

95.2

83.6

Male

%

50.0

86.7

70.0

Female

%

86.7

95.7

84.0

Total
GenderNumber of return-to-

Total
GenderReturn-to-work rate

Total

after parental leave1)
GenderRetention rate after

2021

work after parental leave
GenderReturn-to-work rate

2020

using parental leave
GenderNumber of return-to-

Unit

Male

%

87.0

100.0

89.7

Female

%

93.5

97.8

94.7

%

86.1

90.4

84.1

Total

returning to work 2)

GenderRetention rate after

Total

returning to work 2)
Gender

Male

%

55.6

75.0

63.6

Female

%

87.1

91.4

84.7

Gender1) Return rate = (the number of people who have returned after parental leave) / (the number of people who are scheduled to return after parental leave) × 100
2)	Retention rate after returning = (the number of people who have retained employment for 12 months after returning from parental leave) / (the number of people
who have returned from parental leave during the previous reporting period) × 100

97

Occupational Safety and Health - Amorepacific Group

Occupational Safety and Health - AmorepacificCategory

Unit

2019

2020

2021

2022

Employees Fatalities

Case

0

0

0

%

0.051

0.065

0.145

Accident

Rate1)

Category

Unit

2019

2020

2021

2022

0

Employees Fatalities

Case

0

0

0

0

0.089

Accident

%

0.050

0.064

0.139

0.102

4

5

10

7

rate

rate
Number of accident victims

LTIFR

OIFR

Person

5

6

12

7

%

0.268

0.336

0.755

0.465

Number of industrial accidents

Case

5

6

12

7

Rate3)

%

0

0

0

0

Number of occupational diseases

Case

0

0

0

0

Case

0

0

0

0

Contractors Fatalities

%

0.049

0.043

0.155

0.074

Accident

Rate1)

rate

OIFR

LTIFR

OIFR

PersonRate2)

%

0.258

0.334

0.725

0.532

Number of industrial accidents

Case

4

5

10

7

Rate3)

%

0

0

0

0

Number of occupational diseases

Case

0

0

0

0

Case

0

0

0

0

%

0.040

0.049

0.140

0.078

5

5

12

5

Rate1)

rate
Number of accident victims

LTIFR

Number of accident victims

Rate2)

Contractors Fatalities
Accident

Rate1)

Person

7

5

14

5

Rate2)

%

0.254

0.223

0.807

0.386

Number of industrial accidents

Case

7

5

14

5

Rate3)

%

0

0

0

0

Number of occupational diseases

Case

0

0

0

0

Number of accident victims
LTIFR

OIFR

PersonRate2)

%

0.206

0.253

0.728

0.406

Number of industrial accidents

Case

5

5

12

5

Rate3)

%

0

0

0

0

Number of occupational diseases

Case

0

0

0

0

1) Accident rate = (number of casualties) / (average number of workers per year) × 100
2) Lost Time Injuries Frequency Rate (LTIFR) = (total case of accidents) / (annual working hours) × 1,000,000
3) Occupational Illness Frequency Rate (OIFR) = (total case of occupational diseases) / (annual working hours) × 200,000

98

CSR - Amorepacific Group

Product Development and Innovation - AmorepacificCategory
Expenditures on CSR activities

Disbursement of funds from public

Unit

2020

2021

2022

Category

Amount of expenditure

Million KRW

18,602

17,21917,405

R&D spending2)

Ratio compared to sales

%

0.38

0.32

0.39

Amorepacific Foundation

Million KRW

1,002

915

1,572

foundations

R&D spending ratio compared to sales
Total R&D spending

2019

2020

2021

2022

%

2.2

2.5

2.6

2.9

120,268

112,265

128,321

121,146

Million KRW

Category
Amorepacific Welfare Foundation

Million KRW

692

628

Korea Breast Cancer Foundation

Million KRW

708

1,769

Unit

2022

Person460

Executive

Person8Team leader

Person24805
Current status of
546

Total

employees in R&D
positions1)

Position

CSR - Amorepacific
Unit

2020

2021

2022

Researcher

Person359

Amount of expenditure

Million KRW

16,566

16,027

15,330Technician

Person69

Ratio compared to sales

%

0.37

0.33

0.37

New products commercialized within the reporting year

%

12.4

Improved products within the reporting year

%

11.2

Products unchanged or with limited improvement

%

76.4

Ratio of commercialized new and improved products to products

%

29.9

Category
Expenditures on CSR activities

Unit

Product innovation1)

Ratio of productinnovation to revenue

Customer Satisfaction Measurement - AmorepacificCategory

Unit

2019

2020

2021

2022
Ratio of productCustomer satisfaction1)

Percentage of resolved customer

%

99.7

99.6

99.0

99.9

%

70.7

75.3

83.2

82.9

Case

0

0

0

0

innovation to gross profit unchanged or with limited improvementscomplaints
Customer service satisfaction
measurement results
Product recall1)

Number of recall

1) Calculated based on a separate basis for the domestic corporation of Amorepacific2) Calculated based on domestic and foreign consolidated basis of Amorepacific; see page 26 of the 2022 Amorepacific Business Report, ‘(2) R&D Costs’99

Governance Performance
Ethical Management Implementation - Amorepacific Group

Policy-related Expenditure - Amorepacific Group

Category

Unit

2020

2021

2022

Category

Ethics education Completion rate of the education

%

91.8

92.2

86.6

Political donations and lobbying efforts

Number of employees eligible for the education

Person

6,818

6,319

6,063

Number of employees who have completed the education

Person

6,260

5,825

5,253

%

100

100

91.2

Person

5,550

4,989

5,046

Pledge forParticipation ratebusiness ethics1)
Number of employees eligible for the pledge

2020

2021

2022

Million KRW

0

0

0

Ballot measures, referendums

Million KRW

0

0

0

Major related association membership fees

Million KRW

1,604

1,635

1,273

Major Related Association Membership Fees - Amorepacific Group
Category

Number of employees who have participated the pledge

Person

5,550

4,989

Unit

Unit

Business impact

Unit

2022

Korea Door-to-door Sales Development Association

MemberHigh

Million KRW

1,003

Korea Cosmetic Association

MemberHigh

Million KRW

198

4,601

Ethical Management Implementation - AmorepacificCategory

Unit

2020

2021

2022

Korea Direct Selling Industry Association

MemberHigh

Million KRW

44

Ethics education Completion rate of the education

%

91.2

92.0

86.1

UN Global Compact Network Korea

MemberHigh

Million KRW

17

Number of employees eligible for the education

Person

5,415

5,283

5,122

Korea Health Functional Food Association

MemberHigh

Million KRW

12

Number of employees who have completed the education

Person

4,937

4,861

4,410

%

100

100

91.1

Number of employees eligible for the pledge

Person

5,464

4,909

4,959

Number of employees who have participated the pledge

Person

5,464

4,909

4,517

Pledge forParticipation ratebusiness ethics2)

1) Calculated based on Amorepacific Group and the domestic corporation of Amorepacific on a separate basis
2) Calculated based on a separate basis for the domestic corporation of Amorepacific

100

Ethics and Anti-Corruption Violation - Amorepacific Group
Category

Unit

2020

2021

2022

Category

Total number of ethics and anti-corruption violations1)

Case

15

16

12

Measures by

Unfairviolation type2)transactions

Number ofreports bystakeholder

Clients

Case

0

0

0

Suppliers

Case

0

0

2

Employees

Case

10

7

3

Customers

Case

0

0

0

Others

Case

5

9

7

Measures by

Sexualviolation type2)

harassment/
Workplaceharassment

Private use ofcompany assets

Total
Types ofmeasureswork processes

1

3

1

Heavy punishment

Case

1

2

1

Light disciplinary action

Case

0

1

0

Others

Case

0

0

0

Total
Types ofmeasures

Violation of

Case

Case

3

3

2

Heavy punishment

Case

2

1

2

Light disciplinary action

Case

0

2

0

Others

Case

1

0

0

Total
Types ofmeasures

Case

2

3

5

Heavy punishment

Case

0

0

2

Light disciplinary action

Case

1

1

1

Others

Case

1

2

2

with suppliers/
Reception of

distribution
and copyrightviolations

Violation ofoutside work/
Absenteeism
and tardinessbusiness secrets

management hotline, regular audits, and ad hoc audits2) Other types of measures include personnel actions, verbal warnings, and reoccurrence prevention pledges

measures

Other failures
to comply
with ethical

2021

2022

Case

1

1

0

Heavy punishment

Case

0

0

0

Light disciplinary action

Case

0

0

0

Others

Case

1

1

0

Case

0

2

1

Heavy punishment

Case

0

1

1

Light disciplinary action

Case

0

1

0

Others

Case

0

0

0

Case

5

2

0

Heavy punishment

Case

3

2

0

Light disciplinary action

Case

2

0

0

Others

Case

0

0

0

Case

2

1

0

Heavy punishment

Case

0

0

0

Light disciplinary action

Case

1

0

0

Others

Case

1

1

0

Case

1

1

3

Heavy punishment

Case

1

0

2

Light disciplinary action

Case

0

0

0

Others

Case

0

1

1

Total
Types ofmeasures

Total
Types ofmeasures

Total
Types ofmeasuresstandards

1)	The aggregated data includes cases where the results of the investigation were confirmed after receiving reports on ethics and anti-corruption, through the ethicalTypes ofrules

Leakage of

2020

Total

gifts

Abnormal

Unit

Total
Types ofmeasures101

Ethics and Anti-Corruption Violation - AmorepacificCategory

Unit

2020

2021

2022

Total number of ethics and anti-corruption violations1)

Case

12

14

9

Number ofreports bystakeholder

Clients

Case

0

0

0

Suppliers

Case

0

0

1

Employees

Case

8

6

2

Customers

Case

0

0

0

Others

Case

4

8

6

Measures by

Sexualviolation type2)

harassment/
Workplaceharassment

Private use ofcompany assets

Total
Types ofmeasureswork processes

0

2

0

Heavy punishment

Case

0

2

0

Light disciplinary action

Case

0

0

0

Others

Case

0

0

0

Total
Types ofmeasures

Violation of

Case

Case

3

3

2

Heavy punishment

Case

2

1

2

Light disciplinary action

Case

0

2

0

Others

Case

1

0

0

Total
Types ofmeasures

Case

1

3

4

Heavy punishment

Case

0

0

1

Light disciplinary action

Case

0

1

1

Others

Case

1

2

2

Category
Measures by

Unfairviolation type2)transactions
with suppliers/
Reception of

distribution
and copyrightviolations

Violation ofoutside work/
Absenteeism
and tardinessbusiness secrets

management hotline, regular audits, and ad hoc audits2) Other types of measures include personnel actions, verbal warnings, and reoccurrence prevention pledges

measures

Other failures
to comply
with ethical

2021

2022

Case

1

0

0

Heavy punishment

Case

0

0

0

Light disciplinary action

Case

0

0

0

Others

Case

1

0

0

Case

0

2

1

Heavy punishment

Case

0

1

1

Light disciplinary action

Case

0

1

0

Others

Case

0

0

0

Case

4

2

0

Heavy punishment

Case

3

2

0

Light disciplinary action

Case

1

0

0

Others

Case

0

0

0

Case

2

1

0

Heavy punishment

Case

0

0

0

Light disciplinary action

Case

1

0

0

Others

Case

1

1

0

Case

1

1

2

Heavy punishment

Case

1

0

2

Light disciplinary action

Case

0

0

0

Others

Case

0

1

0

Total
Types ofmeasures

Total
Types ofmeasures

Total
Types ofmeasuresstandards

1)	The aggregated data includes cases where the results of the investigation were confirmed after receiving reports on ethics and anti-corruption, through the ethicalTypes ofrules

Leakage of

2020

Total

gifts

Abnormal

Unit

Total
Types ofmeasures

102

Reporting
Methodology

Reporting Period
The information contained in the report represents theperformance during the period from January 1, 2022, toDecember 31, 2022. Some information prior to 2022 or the
first half of 2023 is included, and explicitly indicated within thereport. For quantitative performance, we provide data for thelatest three years (2020-2022) or four years (2019-2022) toenable annual trend analysis.

Reporting Scope
The scope of financial performance reporting was preparedin accordance with K-IFRS consolidation criteria1) unlessotherwise stated. The scope of non-financial performance
reporting covers the entire domestic and overseas
consolidated subsidiaries of the company (AmorepacificGroup, Amorepacific, Innisfree, ETUDE, Amos Professional,
Espoir, OSULLOC, OSULLOC Farm, COSVISION, WeDream,
Green Partners, and overseas subsidiaries included in thefinancial performance, and the performance of the subsidiaryis indicated separately in the text. In the case of Amorepacific,
the major subsidiary, the reporting covers domestic businesssites (Headquarters, R&I Center, HR Development Center,
Regional Offices, Amore Beauty Park, Daily Beauty production
site, OSULLOC production site, and Healthcare production site)and some of its activities from overseas subsidiaries.
If the scope of a consolidated subsidiary changes due to its
sale, acquisition, or merger, the performance was calculated
by reflecting the scope of consolidation based on the year inwhich the sale, acquisition, or merger occurred, and the majorchanges in the scope of consolidation that occurred within
2020‐2022 are as follows.

· PACIFICGLAS (current Verescence Pacific): As of 2021,
excluded from the Amorepacific Group’s consolidation after
Amorepacific Group sold its stake· COSVISION: As of 2021, changed to the Amorepacific’s
consolidation after Amorepacific bought Amorepacific Group’s
stake· AESTURA: As of 2021, AESTURA, a subsidiary of AmorepacificGroup, has been included within the separate scope ofAmorepacific due to its absorption merger.
· PACIFICPACKAGE (current Autajon Packaging Pacific): From2022, it is excluded from Amorepacific Group’s consolidation
after Amorepacific Group sold its stake

Modification and Restatement of Information
Among the information contained in this report, there aresome information changed from the report published in theprevious reporting year due to modifications and restatement,
as follows.
· In the case of GHG emissions and energy usage of[Amorepacific Group] and [Amorepacific] reported on
p.84-86 of this report, the information from the previous
reporting year is restated, to reflect the retroactive applicationof the consolidated basis for the scope of subsidiarycompanies as of 2022, as per the reassessment of assets.
· The water resource usage, waste disposal, pollutant
emissions, employee status, domestic employment
status, new recruitment status, turnover status, employee
training status, and industrial safety and health status of[Amorepacific], as reported on p.84-89, and p.91-97, havebeen restated from the previous reporting year to reflect theconsolidated basis for the reassessment of assets.
1)	For consolidated companies, see ‘1. Status of Consolidated Subsidiaries’ inAmorepacific Group’s 2022 Business Report p.365-366· The Environmental operation and investment cost for[Amorepacific Group] and [Amorepacific] in 2021, as reported
on p.90, have been restated to reflect the consolidated
reassessment of assets to include the performance of theheadquarters and R&I Center.
· [Amorepacific] restated the information on the average
employment cost per person reported on p.94 of this report,
to correct the information from the previous reporting year
to, include recruitment promotional costs and fees

Calculation Criteria for Quantitative Performance
Quantitative performance in this report, p.84-101, isreported in Amorepacific Group’s consolidation to enhance
stakeholders’ understanding of the company’s ESG activities
and performance, and is also reported in Amorepacific’s
consolidation, its major subsidiary. Some performance
calculated on a separate basis is stated in the notes. The
criteria for calculating detailed performance by indicator are as
follows.

103

Calculation Criteria for Environmental Quantitative Performance
Name of Index

Performance Calculation Methodology

Name of Index

Performance Calculation Methodology· GHG Emissions· Energy
Consumption

Scope of the Report·A mong domestic and overseas consolidated subsidiaries, it includes Amorepacific (domestic), Amorepacific(Shanghai), COSVISION, OSULLOC Farm, and other Amorepacific Group subsidiaries. See the p.111-113 Verification
Statement GHG Inventory in this report for details· I n accordance with GHG protocol, 2020-2021 organization boundary is retrospectively applied to the scope of 2022
consolidated subsidiaries· F or Amorepacific (Shanghai), only the data from its production site was compiled in 2020-2021, and data from its
production site, R&I Center, logistics and headquarters was used from 2022.

· Sustainable
Product
Development

Scope of the Report· Domestic consolidated subsidiaries· Environmental
Management
Implementation

Scope of the Report· Corporations that have production sites among domestic and overseas consolidated subsidiaries, such as
Amorepacific (Korea), Amorepacific (Shanghai), COSVISION, OSULLOC Farm
· Amorepacific (domestic) data includes the headquarters, R&I Center, Amore Beauty Park, Daily Beauty business site,
OSULLOC production site, Healthcare production site· However, for eco-friendly purchases and sales indicator, the scope of data collection covers Amorepacific (domestic)
on a separate basis

Calculation Criteria· I ntensity of GHG emissions = (Scope 1 and 2 emissions)/(the number of products on a consolidated basis)· E nergy intensity = (Total energy usage)/(the number of products based on a consolidated basis)· Water Resource
Management· Waste Disposal· Pollutant
Generation

Scope of the Report·C orporations that have production sites, among domestic and overseas consolidated subsidiaries, such as
Amorepacific (domestic), Amorepacific (Shanghai), COSVISION, OSULLOC Farm·A
 morepacific (domestic) data includes Amore Beauty Park, Daily Beauty production site, OSULLOC production site,
Healthcare production site as the scope of aggregation.
Calculation Criteria· I ntensity of water withdrawal = (Total water withdrawal)/(the number of products on a consolidated basis)·W ater usage = (Total water withdrawal)-(total water discharge)·W aste recycling rate = ((Amount of general waste recycled) + (the amount of designated waste recycled))/(total
waste generated)

Calculation Criteria· Percentage of new products with environmentally/socially friendly attributes = (Number of sustainable products
among new products)/(number of new products) × 100· Sustainable products are calculated as products that meet the criteria defined in the ‘Sustainable ProductDevelopment Rules’ within the company rules

Calculation Criteria· Significant environmental violations are calculated by cases with a fine/penalty of USD 10,000 or more· The purchase amount of eco-friendly products and services is calculated based on whether finished products andraw materials are certified as eco-friendly· Percentage of eco-friendly purchases = (The purchase amount of eco-friendly products and service)/(total purchaseamount) × 100· Sales of new eco-friendly products are calculated based on the products with environmental impact improvement
and vegan-certified products, as defined in the company’s Sustainable Product Development Rules· Percentage of eco-friendly sales = (New eco-friendly product sales in the reporting year)/(total new product sales in
the reporting year)

104

Calculation Criteria for Social Quantitative Performance
Name of Index

Performance Calculation Methodology

Name of Index

Performance Calculation Methodology· Domestic
and Overseas
Employment

Scope of the Report· Domestic and overseas consolidated subsidiaries· New Employment

Scope of the Report· Domestic consolidated subsidiaries· However, internal employment rate for open positions and average employment cost are calculated on a separatebasis for Amorepacific· Domestic
Employment

Calculation Criteria· Calculated by the number of employees as of December 31st by year·T
 he number of domestic employees includes permanent and temporary employees but does not include dispatchedworkers· The number of overseas employees includes permanent and dispatched employees
Scope of Report· Domestic subsidiaries in a consolidated basis

Calculation Criteria· Includes both permanent and temporary employees· However, internal employment rate for open positions and average employment cost are calculated on the basis ofpermanent employees· TurnoverCalculation Criteria· Calculated by the number of employees as of December 31st by year
· Total number of permanent employees includes executives· The number of temporary employees includes contract workers and interns· Overseas Local
Employment· Diversity

Calculation Criteria· Calculated on the basis of permanent employees, and records between subsidiaries are excluded·V oluntary turnover occurs when an employee voluntarily resigns regardless of the company’s intentions; it includes
company transfer and resignation.
· Turnover rate = (The number of turnovers in the reporting year)/(the number of employees in the previous year)

Scope of the Report· Overseas consolidated subsidiaries
Calculation Criteria· Calculated by the number of employees as of December 31st by year
· Excludes dispatched employees·A s all overseas subsidiaries are included in the subsidiary subject to Amorepacific’s consolidation, the current statusof Amorepacific Group and Amorepacific employment is the same
Scope of the Report· Amorepacific domestic subsidiaries on a separate basis and overseas subsidiaries on a consolidated basis·H owever, in the case of equivalent wage indicators, it is calculated based on a separate domestic corporation ofAmorepacificCalculation Criteria· Calculated by the number of employees as of December 31st by year·T
 he number of employees with revenue-generating positions is calculated as the number of employees in businessdepartments such as sales and brands·T he number of employees in Science, Technology, Engineering, Mathematics (STEM) work is calculated as thenumber of employees in STEM-related support departments such as R&D and digital strategy

Scope of the Report· Domestic subsidiaries in a consolidated basis· Employee Training Scope of the Report
and Development · Domestic consolidated subsidiaries
Calculation Criteria· The number of employees eligible for the training is calculated based on the number of permanent employees by year·A verage training hours by type = (Total training hours by type)/(the number of employees eligible for the training, bytype)· Average training cost per person = (Total training cost)/(the number of employees eligible for the training)· Parental Leave

Scope of the Report· Domestic consolidated subsidiaries
Calculation Criteria· Return rate = (The number of people who have returned after parental leave) / (the number of people who arescheduled to return after parental leave) × 100· Retention rate after returning = (The number of people who have retained employment for 12 months after returningfrom parental leave) / (the number of people who have returned from parental leave during the previous reporting
period) × 100

105

Calculation Criteria for Governance Quantitative Performance
Name of Index

Performance Calculation Methodology

Name of Index

Performance Calculation Methodology· Occupational
Safety and Health

Scope of the Report· Domestic consolidated subsidiaries, and Shanghai subsidiary, among overseas consolidated subsidiaries· EthicalManagement
Implementation

Scope of the Report· In the case of ethics education indicators, they are calculated based on Amorepacific domestic consolidated
subsidiaries· In the case of business ethics pledge indicators, they are calculated based on Amorepacific Group’s subsidiaries andAmorepacific domestic separate corporation

Calculation Criteria· Calculated based on the reporting of industrial accidents and the criteria recognized by the competent Ministry of
Employment and Labor· Accident rate = (Number of casualties)/ (average number of workers per year) × 100· Lost Time Injuries Frequency Rate (LTIFR) = (Total cases of accidents)/(annual working hours) × 1,000,000· Occupational Illness Frequency Rate (OIFR) = (Total cases of occupational diseases)/(annual working hours) × 200,000· Customer
Satisfaction
Measurement· CSR

Scope of the Report· Amorepacific domestic separate corporation
Calculation Criteria· Percentage of resolved customer complaints = (The number of resolved customer complaints)/(the number ofcustomer complaints) × 100· Customer service satisfaction measurement results are calculated based on the recommendation index in thesatisfaction survey sent to the customer after the customer consultation is completed
Scope of the Report· Domestic and overseas consolidated subsidiaries
Calculation Criteria· In the case of the expenditures on CSR activities, it is calculated as the sum of costs, including cash donations, in-kind
donations, and management overhead expenses· In the case of disbursement of funds from public foundations, it is reported based on Amorepacific’s consolidated
standards· Product Innovation Scope of the Report· In the case of R&D cost indicators, it is calculated based on Amorepacific’s domestic and overseas consolidated
subsidiaries· Product innovation indicators and current status of employees in R&D positions are calculated based on Amorepacificdomestic separate corporation
Calculation Criteria· In the case of R&D cost indicators, it is calculated based on ‘(2) R&D Costs,’ standard in page 26 of the 2022
Amorepacific Business Report.

Calculation Criteria· In the case of the number of employees eligible for ethics education, all executives, general employees, office staffs,
technicians, and contract employees of all subsidiaries of Amorepacific Group are counted as of the time of training,and employees on leave of absence are excluded· Policy-relatedExpenditure Status· Major related
Association
Membership Fees

Scope of the Report· Domestic consolidated subsidiaries· Number ofUnethical Reports

Scope of the Report· Domestic and overseas consolidated subsidiaries

Calculation Criteria· Amorepacific Group complies with the ban on corporate political donations (political funds, voting-related
campaign funds, political organization lobbying funds, etc.) under Article 31 of the Domestic Political Fund Act, andsponsors some public interest associations and industrial associations that guarantee political neutrality

Calculation Criteria· The number of cases for ethics and anti-corruption violation is an aggregate of cases where the results of theinvestigation were confirmed after receiving reports related to ethics and anti-corruption, through the ethicalmanagement hotline, regular audits, and ad hoc audits, etc.

106

Chapter 5

Appendix

107

GRI
Content Index

Topic

Disclosure

GRI 2:
GeneralDisclosures
2021

Organizational details 6, 75

2-2

Entities included in
the organization’ssustainability
reporting2
Reporting period,
frequency and contact
point

Role of the highest
governance bodyin sustainability
reporting16, 232-15

Conflicts of interest-

2022 Amorepacific Business Report p.316-318,
2022 Amorepacific Group Business Governance
Report p.46-48

2-16

Communication ofcritical concerns

762022 Amorepacific Group Business Report p.314-316

2-17Collective knowledgeof the highest
governance body-2022 Amorepacific Group Business Report p.318

2-18

Evaluation of theperformance of thehighest governance
body

73

2022 Amorepacific Group Business Governance
Report p.52-53

2-19

Remuneration
policies-

2022 Amorepacific Group Business Report p.332336, 2022 Amorepacific Group Business Governance
Report p.52-53

2-6

Activities, value
chain andother business
relationships

6, 8-12, 13-14,
54-55, 56-57

2-7

Employees

91-93, 104

2-8Workers who are not 92, 104
employees

2-9

Governancestructure andcomposition

16, 73-75

2022 Amorepacific Group Business Governance
Report p.34-45

2-20

Process to determine
remuneration-

2022 Amorepacific Group Business Report p.316,
332-336, 2022 Amorepacific Group BusinessGovernance Report p.52-53, 65, 69-70

2-10

Nomination andselection of thehighest governancebody-2022 Amorepacific Group Business Governance
Report p.64

2-21

Annual totalcompensation ratio-

2022 Amorepacific Group Business Report p.331,
333-334

2-22

Chair of the highest
governance body-5
Statement onsustainable
development strategy

2-23

Policy commitments

Role of the highest
governance bodyin overseeing themanagement of
impacts

16, 2333, 48, 50, 54,
78-79

2-24

Embedding policy
commitments

48-50, 54-55,
56-57, 78-80

2-25

48, 76, 80

Delegation of
responsibility for
managing impacts

16, 23

Processes toremediate negative
impacts

2-11
2-12

Therefore, Amorepacific Group reviewed various external data toidentify material topics specific to the HOUSEHOLD & PERSONAL

27 of the report.

2, 102-105

2-14

114

no applicable GRI Sector Standards were announced by GRI.

results. For a more detailed explanation, please refer to pages 21-

GRI 2:
GeneralDisclosures
2021

External assurance

GRI 1 usedmaterial topics were reported along with the corresponding

Comments

2-5

2022, is reported in accordance with the GRI Standards.

PRODUCTS industry, based on GICS® standards. The selected

Report pages

102

The ‘2022 Amorepacific Group Sustainability Report,’ which covers

As of June 2023, when Amorepacific Group publishes its report,

Disclosure

Restatements of
information

Statement of Use

Applicable GRI Sector Standards

Topic

General Disclosures

2-1

2-4

GRI 1: Foundation 2021

Comments

General Disclosures

2-3

the ESG performance from January 1, 2022 to December 31,

Report pages

2-132022 Amorepacific Group Business Report p.14-66

2022 Amorepacific Group Business Report p.331,
2022 Amorepacific Business Report p.294

2022 Amorepacific Group Business Governance
Report p.38

108

GRI
Content Index

Topic

Disclosure

Report pages

Comments

General Disclosures
GRI 2:
GeneralDisclosures
2021

Topic

Disclosure

Report pages

3-1

Process todetermine material
topics21-27

3-2

List of material
topics

21-27

Material Topics

2-26

Mechanisms forseeking advice andraising concerns

2-27Compliance with laws and regulations

2-28

Membershipassociations

20, 99Packaging environmental impact
3-3

Approach to
stakeholder
engagement

20

GRI 3:
Material
Topics 2021

Management ofmaterial topics

19, 20, 22, 23, 24,
27, 28, 41

301-1

47

Materials used byweight or volume1)

42

Collective bargaining
agreements

GRI 301:
Materials

301-3

Reclaimed products 19, 42
and their packaging
materials1)

2-29

2-30

Comments

80

GRI 3:
Material
Topics 2021
2022 Amorepacific Group Business Report p.351-355

Sustainable Products and Services
GRI 3:
Material
Topics 2021

3-3Management ofmaterial topics

18, 20, 22, 23, 25,
27, 28

GRI 3:
Material
Topics 2021

3-3Management ofmaterial topics

19, 20, 22, 23, 26,
27, 29, 35-37

GRI 302:
Energy302-1

Energy consumption 19, 26, 27, 35-37,
within the
84-85, 86, 104
organization

302-3

Energy intensity

302-4

Reduction of energy 19, 26, 27, 29, 35consumption
37

Energy Use

84-85, 86,
1041) Reported on packaging material which is a material topic

No GRI Topic Standards associated with thiscritical topic

109

SASB Index

Sustainability Disclosure Topics & Accounting Metrics
Topic

Code

Accounting Metric

Description

Water

CG-HP-(1) Total water withdrawn

Amorepacific Group: 762,865 tonnes, Amorepacific: 473,346 tonnes

Management

140a.1(2) Total water consumption

Amorepacific Group: 482,163 tonnes, Amorepacific: 192,644 tonnes(3) Percentage of (1) and (2) in regions with high or extremely

The Group has no production site in regions with high water stress, based on the World Resources Institute(WRI) standards.

high baseline water stress
CG-HP-

Description of water management risks and discussion of

The Group has low risks in water usage as it has no production site in regions with high water stress. We have established 3R principles: Reduce to improve water usage140a.2strategies and practices to mitigate those risks

efficiency; Recycle to expand water recycling; and Reuse to expand water reuse, in order to effectively manage water risk and ensure efficient water management.

Product

CG-HP-

Revenue from products that contain REACH substances of very Amorepacific Group’s quality standards encompass the SVHC (Substances of Very High Concern) list of REACH (EU New Chemicals Control System). All raw materials are

Environmental,

250a.1high concern (SVHC)

utilized only when they meet the internal standards specific to their application. We strictly avoid using substances other than cyclosiloxane (D5, D6), and even for D5 andD6, proper management measures are in place prior to regulatory requirements. Meanwhile, alternative raw materials and formulations are being developed.

Health,and Safety
Performance

CG-HP-

Revenue from products that contain substances on the

Only substances and raw materials that meet the criteria for safe cosmetics are selectively chosen and used, adhering to domestic regulations, such as the ‘Chemical

250a.2

California DTSC Candidate Chemicals List

Registration and Evaluation Act’ and ‘Chemical Control Act’. These regulations are equivalent to DTSC’s Candidate Chemical List.1)

CG-HP-

Discussion of process to identify and manage emerging

Amorepacific Group adheres to EU REACH and CLP regulations, as well as global regulations specific to each country, including pharmaceutical and food additive regulations,250a.3materials and chemicals of concern

to ensure the exclusion of harmful ingredients. Furthermore, we continue to monitor the results of evaluations by internationally trusted institutions such as CCS, CIR, EFSA,
and IARC. The Group operates a process to discern the safe of products by evaluating human and environmental impacts when introducing new substances Also, the MSDS
(Material Safety Data Sheet) of all chemicals used by the Group is managed through the Amorepacific Group Chemicals Integrated Management System (AP-CHEMS).

Activity Indicators
Topic
Activity
Indicators

Code

Accounting Metric

CGUnits of products
HP-000.A sold, total weight ofproducts soldCGNumber of
HP-000.B manufacturing
facilities

CG-HP-

Revenue from products designed with green chemistry

Amorepacific Group continuously develops sustainable products manufactured with technologies such as a low energy emulsification process, waste reduction technology

250a.4principles(green technology certification), and an eco-friendly solvent application process according to our internal sustainable product standards.

Packaging

CG-HP-(1) Total weight of packaging

The total weight of plastic packaging materials is 12,640 tonnes.

Lifecycle

410a.1

Management(3) Percentage that is recyclable, reusable, and/or compostable 47.1%

Description
As Amorepacific Group
has a wide variety
of product portfolio,
information about theunit and total weightof products sold is notdisclosed.
5 (Amore Beauty Park,
Daily Beauty production
site, OSULLOC
production site,
Healthcare production
site, Shanghai
production plant)(2) Percentage made from recycled and/or renewable materials 6.6%

CG-HP-

Discussion of strategies to reduce the environmental impact of The 4RReduce, Recycle, Reuse, Return strategies were established for packaging materials to create a plastic circulation model by reducing the use of unnecessary plastic

410a.2

packaging throughout its lifecycle

packaging materials, improving recyclability, reusing and returning containers throughout the product’s lifecycle. To implement the strategy, the goal of designing 100%plastic packaging materials to be recyclable, reusable or compostable by 2030, and applying recycled or bioplastics to 30% of plastic packaging materials, was included in
the fourth promise of 2030 A MORE Beautiful Promise. Furthermore, brand-level Key Performance Indicators (KPIs) have been established to track the progress, and theenvironmental impact of packaging materials is closely managed to ensure efficient use of packaging raw materials.

Environmental &CG-HP-

Amount of palm oil sourced, percentage certified through theSocial Impacts of

430a.1Roundtable on Sustainable Palm Oil (RSPO) supply chains as

Palm Oil Supply(a) Identity Preserved, (b) Segregated, (c) Mass Balance, or (d)ChainBook & ClaimApproximately 20,145 tonnes of palm-derived raw materials were sourced in 2022, with a 53.6% ratio of RSPO MB (Mass Balance) certified palm oil.

1)	The purpose of regulations such as DTSC’s Candidate Chemical List, EU REACH/CLP regulations, and domestic chemical evaluation laws like the Chemical Substance Registration and Evaluation Act, and Chemical Substance Control Act, is the same. They aim toassess and manage chemical substances based on similar risk criteria. Given that the domestic chemical evaluation laws in Korea have benchmarked EU REACH, one of the key standards for DTSC’s Candide Chemical List, we consider the domestic regulations tobe equivalent to the DTSC’s Candidate Chemical List.

110

TCFD Index

TCFD Disclosure
TCFD Recommendations
Governance

Strategy

Risk Management

Metrics and Targets

Report Pagesa)

The board’s oversight of climate-related risks and opportunities

16, 23, 38b)Management’s role in assessing and managing climate-related risks and opportunities

16, 23, 38a)

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

38, 39b)

The impact of climate-related risks and opportunities on the organization’s businesses, strategy, and financial planning26, 39c)

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

39a)

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

27, 38, 39b)The organization’s processes for managing climate-related risks

27, 38, 39c)

How processes for identifying, assessing, and managing climate-related risks are integrated into the organization’s overall risk management27, 38, 39

a)

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

27, 39b)Disclose Scope 1, Scope 2 and, if appropriate, Scope 3 greenhouse gas (GHG) emissions and the related risks

84, 85c)

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

17, 19, 26, 27, 36

111

Verification
Statement GHG
Inventory

Introduction
DNV Business Assurance Korea Ltd. (“DNV”) was
commissioned by AMOREPACIFIC Group to verify its
Greenhouse Gas Inventory Report for the calendar year 20202022 (“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 with them.
DNV expressly disclaims any liability or responsibility for any
decisions, whether investment or otherwise, based upon thisassurance statement.

Scope of Assurance
The emissions data covered by our examination comprise
Direct emissions (Scope 1 emissions), Energy indirect emissions(Scope 2 emissions) and Other indirect emissions (Scope 3
emissions) from following organizational boundaries:· Organizational Boundary Setting: Operational control
approach (Consolidated accounting based)· AMOREPACIFIC: HQ, Sale offices, Manufacturing Sites (Beauty
1&3 in Osan, Daejeon, Ansung and Jincheon), Distribution
centers (Gangbuk, Gwangju, Gimcheon, Daejeon, Gimhae,Osan, Incheon, and Jincheon), R&I/HRD, Local Business unit
(Gwangju, Daegu, Daejwon, Busan, and Jeju)· Innisfree: Head office, Sales stores, Laboratory· COSVISION: Daejeon· OSULLOC Farm: Seokwang factory, Dolsongi factory, Dongilli
warehouse, Wolchulsan factory, and Kwanghaewon factory· AMOREPACIFIC Shanghai: Headquarters, 1,2,3 Factories,
Research institutes, Logistics· AMOREPACIFIC Shanhai: Plant #1,2,3, D&I center, Office,Distribution center· Others in AMOREPACIFIC Group: ETUDE, AMOS
PROFESSIONAL, ESPOIR, OSULLOC, AmorepacificFoundation, Amorepacific Empathy Foundation, Suh
Kyungbae Foundation, BBDO KOREA

Greenhouse Gas Emissions of AMOREPACIFIC Group
2020-2022
GHG Emissions(tCO2-eq)

Scope 1

Refer to theattachment #1,2

Scope 2
Scope3
Total (Scope 1,2)

Verification Approach
The verification has been conducted by DNV from 20th
February through 8th May 2023 and performed in accordancewith the verification principles and tasks outlined in ISO
14064-3:2019. We planned and performed our work so
as to obtain all the information and explanations deemednecessary to provide us with sufficient evidence to provide
a verification opinion with 5% materiality level, concerning
the completeness of the emission inventory as well as thereported emission figures in ton CO2 equivalent. As part of theverification process;Total (Scope 1,2,3)
Energy Consumption (GJ) FuelElectricity
Renewable Energy
Total· We have reviewed and verified the Greenhouse Gas Inventory
Report of AMOREPACIFIC Group (including activity data,
GHG emission calculation results, emission factors, and otherparameters)· We have reviewed and verified the process to generate,
aggregate and report the emissions data

Conclusions
Based on the above verification of core elements, it is the
DNV’s opinion that nothing comes to our attention tosuggest that GHG emissions are not properly calculated, anda significant uncertainty and error are included in the GHG
Emissions from domestic sites of AMOREPACIFIC Group for
2020-2022 below;

8th May 2023
DNV Business Assurance Korea
Country Representative Lee, Jang Sup

112

APPENDIX I. GHG & Energy information by sites (Cert. No.: AS_PRJN-515340_APG)
Year

2020

2021

2022

Organizational Boundary

Energy Consumption (GJ)

GHG Emissions (tCO2-eq)
Scope 1

Scope 2

Scope 3

Total (Scope 1,2)

Total (Scope 1,2,3)

FuelElectricity

Renewable Energy1) Total

AMOREPACIFIC

8,978

34,120587,616

43,098630,715

175,253

265,046

15,881

456,181COSVISION

658

2,785

18,184

3,443

21,626

12,90321,503-34,406Innisfree

-

-

-

-

-

-

-

-

-

OSULLOC Farm

2,416

1,187

-

3,603

3,603

36,5749,165-

45,740AMOREPACIFIC Shanghai2)

703

6,620

-

7,323

7,323

15,75831,874221

47,852Others in AMOREPACIFIC Group4)

420

2,037

-

2,456

2,456

8,271

15,724-23,995

Total

13,174

46,749605,800

59,923665,723

248,758

343,313

16,102

608,173AMOREPACIFIC

8,380

33,603502,788

41,984

544,772

163,695

264,392

30,149458,236COSVISION

768

3,306

27,2394,074

31,313

15,11325,906-41,019Innisfree

-

-

-

-

-

-

-

-

-

OSULLOC Farm

1,896

1,187

-

3,084

3,084

28,8208,736-

37,556AMOREPACIFIC Shanghai2)

1,608

-

-

1,608

1,608

19,806-37,317

57,123

Others in AMOREPACIFIC Group4)

328

2,010

-

2,338

2,338

7,241

15,444-

22,685

Total

12,981

40,106530,02753,087583,115

234,676

314,478

67,465

616,619

AMOREPACIFIC

7,825

24,151

490,106

31,977522,082

153,040

189,251

88,791

431,081COSVISION

739

3,325

19,745

4,064

23,808

14,542

26,055-40,597Innisfree

81

1,251

423

1,333

1,756

1,554

9,806

-

11,360

OSULLOC Farm

1,928

1,211

-

3,139

3,139

29,4059,489-

38,893AMOREPACIFIC Shanghai3)

1,652

929

-

2,581

2,581

19,447

7,964

29,90757,318Others in AMOREPACIFIC Group4)

196

1,476

-

1,672

1,672

3,849

11,568-15,417

Total

12,421

32,344510,274

44,765555,039

221,836

254,133

118,697594,667* The emission figure is rounded up.
1)	Renewable Energy: Energy generated from Hydroelectricity, Solar
photovoltaic & thermal power, Geothermal power, Wind Power, Bio Energy2) AMOREPACIFIC Shanghai (2020-2021): Plant #1,2,3,
3)	AMOREPACIFIC Shanghai (2022): Head Office, Plant #1,2,3, R&I,
Distribution center4)	Others in Amorepacific Group: ETUDE, Amos Professional, Espoir, OSULLOC,
Amorepacific Foundation, Amorepacific Empathy Foundation, Suh Kyungbae
Foundation, BBDO KOREA

113

APPENDIX II. Scope 3 emission information (Cert. No.: AS_PRJN-515340_APG)
Category

Scope 3 (Other Indirect Emissions)

2020

2021

2022

AMOREPACIFICCOSVISION

Total

AMOREPACIFICCOSVISION

Total

AMOREPACIFICCOSVISION

Innisfree

Total

1

Purchased goods & services

239,464

10,949250,413247,378

14,879262,258

171,630

12,782

381

184,7932

Capital goods

570

-

570

420

-

420

7,168

-

-

7,168

3

Fuel-and energy-related activities

944

64

1,008

917

77

994

858

74

-

932

4

Upstream transportation and distribution

3,307

121

3,427

3,495

188

3,682

2,463

175

-

2,638

5

Waste generated in operations

2,874

17

2,890

2,362

19

2,381

1,772

26

-

1,798

6

Business travel

775

11

787

411

6

417

793

6

-

799

7

Employee commuting

3,110

33

3,143

2,439

34

2,472

2,458

33

-

2,491

9

Downstream transportation and distribution

4,063

-

4,063

7,013

-

7,013

5,247

-

-

5,247

11

Use of sold products

296,207

6,831

303,038

205,663

11,862

217,525

278,1456,575-

284,720

12End-of-life treatment of sold products

30,786

158

30,94527,068175

27,243

13,27173

42

13,386

13

Downstream leased assets

5,517

-

5,517

5,623

-

5,623

6,301

-

-

6,301

587,616

18,184605,801

502,788

27,239530,027

490,106

19,745423

510,274

Total

This Assurance Statement is valid as of the date of the issuance (8th May2023). Please note that this Assurance statement would be revised if any
material discrepancy which may impact on the Greenhouse Gas Emissions of
AMOREPACIFIC Group is subsequently brought to our attention. In the eventof ambiguity or contradiction in this statement between English version and* The emission figure is rounded up.

Korean version, Korean shall be given precedent.

114

Independent
Assurance
Statement

Introduction and Objectives of Work

Scope

Methodology

BSI Group Korea (hereinafter “the Assurer”) was requested
to verify 2022 Amorepacific Group Sustainability Report(hereinafter “the Report”). This assurance statement applies
only to the relevant information included in the scope of
the assurance. Amorepacific Group is solely responsible forall information and assertion contained in the Report. The
responsibility of the Assurer is to provide Amorepacific GroupManagement with independent assurance statement based on
its expert opinions by applying the verification methodology
for the specified assurance scope. It is also to provide theinformation to all stakeholders of Amorepacific Group.

The scope of assurance applied to the Report is as follows;

As a part of its independent assurance, the Assurer has used
the methodology developed for relevant evidence collectionin order to comply with the verification criteria and to reduce
errors in reporting. The Assurer has performed the following
activities;

Standards and Levels
This assurance was based on the AA1000AS (AssuranceStandard) v3 (2020) Assurance Standard and confirmed that
the Report was prepared in accordance with the GRI Standards,
the international standards guidelines of sustainability
reports. In accordance with the AA1000 AS, the assurance
level was Moderate Level, and conducted against Type 1 toconfirm compliance with the four principles of the AA1000 AP(AccountAbility Principles) 2018 and the Type 2 assurance thatverified the quality and reliability of the information disclosed
in the report. Type 2 was limitedly verified against the topic
standards below, based on the data and information provided
by the reporting organization.

· GRI Topic standards: 301-1, 301-3, 302-1, 302-3, 302-4· Report contents during the period from January 1st to December 31st
2022 included in the report, some data included 2023· Major assertion included in the report, such as sustainability
management policies and strategies, goals, projects, and performance,
and the report contents related to material issues determined as a resultof materiality assessment· Appropriateness and consistency of processes and systems for datacollection, analysis and review

The following contents were not included in the scope ofassurance.
· Financial information in Appendix· Index items related to other international standards and initiatives otherthan the GRI· Other related additional information such as the website, business
annual report· Review of the system for sustainability management strategy process
and implementation· Review of materiality issue analysis process and prioritization byreviewing materiality issue analysis process and verifying the results· Review of the evidence to support the material issues throughinterviews with senior managers with responsibility for them· Verification of data generation, collection and reporting for eachperformance index

Limitation
The Assurer performed limited verification for a limited period
based on the data provided by the reporting organization.
It implies that no significant errors were found during theverification process, and that there are limitations related
to the inevitable risks that may exist. The Assurer does notprovide assurance for possible future impacts that cannot be
predicted or verified during the verification process and any
additional aspects related thereto.

115

Assurance Opinion

AA1000 AP (2018)

Key areas for ongoing development

Evaluation against GRI ‘In Accordance’ Criteria

On the basis of our methodology and the activities describedabove, it is our opinion that

Inclusivity: Stakeholder Engagement and Opinion

AmorePacific Group has established mid- to long-term
strategies and plans for sustainability, specifies sustainability
goals in each area, such as the environment and society,and disclosed the degree and achievement of each goal. In
future reporting, it may be helpful to derive underperforming
sustainability issues and disclosing the direction and plans forrevising related sustainability mid- to long-term strategies toensure the balance of reporting.

The Assurer confirmed that the Report was prepared inaccordance with the GRI Standards and the disclosures related
to the following Universal Standards and Topic Standards
Indicators based on the data provided by Amorepacific Group,
the sector standard was not applied.

· The information and data included in the Report are accurate
and reliable and the Assurer cannot point out any substantial
aspects of material with mistake or misstatement.
· The report is prepared in accordance with the GRI Standards.
(Reporting in accordance with the GRI standards)· The assurance opinions on the four principles presented in
the AA1000 AP (2018) are as follows.

Amorepacific Group defined customers, employees,
shareholders/investors, local communities, business partners
and relevant institutions/associations as key stakeholders
groups, and operated communication channels for eachstakeholder group for engagement. Amorepacific Group
reflected key issues drawn through stakeholder channels insustainability management decisions and disclosed the process
in the Report.
Materiality: Identification and reporting of material
sustainability topics
Amorepacific Group established the strategy related tosustainability management and established the process toderive reporting issues. Amorepacific Group identified financial
and social/environmental impacts and derived 3 material
topics based on the analysis of media research, benchmarking
global advanced companies in its field, and analysis of major
global initiatives related to sustainability.
Responsiveness: Responding to material sustainability topics
and related impacts
Amorepacific Group established the management process formaterial topics determined by the materiality assessment,
implemented a response plan for each topic to appropriately
respond to the derived material topics that reflects the
expectations of stakeholders. Amorepacific Group disclosed
the process including policy, indicator, activity and response
performance on material topics in the Report.

[Universal Standards]· 2-1 to 2-5 (The organization and its
reporting practices), 2-6 to 2-8 (Activities
and workers), 2-9 to 2-21 (Governance),

Statement of independence and competence
BThe Assurer is an independent professional institution thatspecializes in quality, health, safety, social and environmental
management with almost 120 years history in providing
independent assurance services. No member of the assurance
team has a business relationship with Amorepacific Group.
The Assurer has conducted this verification independently,
and there has been no conflict of interest. All assurers who
participated in the assurance have qualifications as an
AA1000AS assurer, have a lot of assurance experience, and havein-depth understanding of the BSI Group’s assurance standard
methodology.

· 2-22 to 2-28 (Strategy, policies andpractices), 2-29 to 2-30 (Stakeholder
engagement), 3-1 to 3-3 (Material Topics
Disclosures)[Topic Standards]· 301-1, 301-3, 302-1, 302-3, 302-4

25 May 2023
S. H. Lim
BSI Group Korea, Managing Director

116

Date of Publication

June 2023

Publisher

Suh Kyung-bae

Publishing Organization Amorepacific Group
Production

Sustainable Innovation Team, Amorepacific

Design Planning

Creative Strategy Team, Amorepacific

Designcement100, Hangang-daero, Yongsan-gu, Seoul, Republic of Korea
Tel. 02 6040 5114
E-mail. csr@amorepacific.com
www.apgroup.com