2023 ESG Report

Pan Ocean strives to become a global leading shipping and logistics company

by enhancing corporate and shareholder value through practical and transparent management practices.

22023 PAN OCEAN ESG REPORTABOUT THIS REPORTABOUT THIS REPORT ｜ CONTENTS ｜ LETTER TO STAKEHOLDERS

This report is the second Sustainable Management Report of Pan Ocean Co., Ltd. (hereinafter referred to as "Pan Ocean").

It is published to transparently disclose the direction of our sustainable management efforts and ESG management performance to stakeholders.

PeriodScope

Principles

ber 2022. For certain major activities, it also refers to data up to the firstquarters and offices, as well as the activities of overseas subsidiaries and

It is also based on the Sustainability Accounting Standards Board(SASB)

This report covers activities and performances from January to Decemhalf of 2023.

The reporting scope of this report includes Pan Ocean’s domestic headoffices, including its subsidiary, POS SM. Financial results were preparedin accordance with the consolidated financial statements guidelines ofThis report follows the Global Reporting Initiative (GRI) Standards 2021.
and Task Force on Climate-related Financial Disclosures (TCFD).

the Korean International Financial Reporting Standards (K-IFRS). Any discrepancies in the reporting scope, if present, have been clearly indicated.

Cycle

Reliability

Contact Information

report annually.

ification by an independent external organization, Korea Management

Address Tower 8, 7 Jongno5-gil, Jongno-gu, Seoul

Pan Ocean publishes this ESG (Environmental, Social, and Governance)

To ensure reliability and fairness, this report underwent third party ver-Register, in accordance with the AA1000AS international verification
standards.

Business Management Team, Pan Ocean Planning Department
Tel 02-316-5160

E-mail esg@panocean.com

32023 PAN OCEAN ESG REPORTABOUT THIS REPORT ｜ CONTENTS ｜ LETTER TO STAKEHOLDERSCONTENTSABOUT THIS REPORT ｜ CONTENTS ｜ LETTER TO STAKEHOLDERSOVERVIEW

Company Overview
Business Overview

07
11

ENVIRONMENTAL

Establishment of Environmental Management System

25

Investment in Green Vessels

32

Environmental Impact Management

Greenhouse Gas and Energy Management
Climate Change Response

ESG IMPACT

2022-2023 ESG Highlights

18

Stakeholder Engagement

23

Materiality Assessment

19

SOCIAL

29
35
37

43

Safety and Health Management

57

Supply Chain Management
Social Contribution

GOVERNANCE

45
66
67

Governance70

Ethical and Compliance Management

76

Risk Management

Information Security

ESG Data

83

SASB Index

102

Third-party Verification Statement

105

GRI Contents Index
TCFD Index

GHG Verification Statement

Association Memberships and Awards Achievements

Human Rights Management

Human Resources Management

APPENDIX

73
80

95

104
106
107

4

2023 PAN OCEAN ESG REPORTLETTER TO STAKEHOLDERSABOUT THIS REPORT ｜ CONTENTS ｜ LETTER TO STAKEHOLDERS

Dear stakeholders,

I extend my warm greetings to you on the occasion of Pan Ocean's second Sustainable
Management Report publication. Since our establishment in 1966, Pan Ocean has emerged
as a prominent shipping company, overcoming various challenges that have shaped ourjourney. Today, we proudly stand as a leading representative of the maritime industry inSouth Korea.

Amidst strengthened environmental regulations and the dynamic market landscape, I am

pleased to share that Pan Ocean achieved its best business performance last year, surpassing all previous records. This remarkable accomplishment would not have been possible

without the unwavering support and dedication of our valued business partners, shareholders, and employees. We are grateful for your continued interest and support.

Recognizing that our responsibilities extend beyond financial success, we feel a profoundsense of duty towards addressing broader social challenges.

Through continuous innovation and a commitment to global standards, we aim to enhance our corporate value and contribute to solving pressing societal issues.

52023 PAN OCEAN ESG REPORTLETTER TO STAKEHOLDERSABOUT THIS REPORT ｜ CONTENTS ｜ LETTER TO STAKEHOLDERS

Since 2009, we have voluntarily collected and managed greenhouse gas emissions data from our operations on

Additionally, we have implemented an ethical management system and established a Risk Management Commit-

continue to strengthen our environmental management system, striving for continuous improvement.

sustainable management by strengthening our ESG foundation.

land and at sea. Building on the foundation laid by our Environmental Management Policy established in 2012, we

tee to proactively address various risks associated with our business activities. These initiatives contribute to our

In August 2022, we set ambitious long-term targets, including the declaration of 'Net Zero by 2050,' and unveiled

Recognizing the impact of ESG factors on our sustainable management, we are actively promoting awarenessas adopting low-carbon fuels and introducing zero-emission vessels. These initiatives align with our vision ofareas of improvement and enhance our overall ESG performance.

our roadmap for carbon reduction, the '2030 Carbon Reduction Strategy,' which outlines specific measures suchachieving a sustainable future and making a meaningful contribution to combatting climate change.

The safety and well-being of our employees and stakeholders are of paramount importance. We are actively preparing for ISO 45001 certification in 2023 to establish a comprehensive occupational health and safety system.

Through the implementation of our safety and health management system, we aim to proactively identify andprevent potential risks, minimize harm, and foster a culture of safety awareness.

Furthermore, we have embraced the principles of human rights management through our Human Rights Management Declaration. By formulating guidelines for human rights management, we seek to fulfill our social re-among our employees and striving to improve our ESG activities. Through these efforts, we aim to address any
Despite the challenges posed by economic uncertainties, we remain steadfast in our commitment to our core values
and continuous growth. We believe that by upholding these values, we can navigate through the current realities
and strive for excellence.

We sincerely appreciate your unwavering support and encouragement as we pursue our journey of improvement.
Your continued partnership is vital to the success of Pan Ocean's endeavors.
Thank you.

sponsibility and role safeguarding the rights of our employees and stakeholders. Our commitment to humanrights management aligns with international principles, including the UN Universal Declaration of Human Rights.
As part of our efforts to enhance corporate governance, in February 2022, we established and disclosed the Corporate Governance Charter. Based on this charter, we strive to protect the rights of all stakeholders, including share-

holders, and seek to establish and develop a sound corporate governance framework. Furthermore, to strengthentransparency in our management, we disclose the operations of key decision-making bodies such as the general
meeting of shareholders, Board of Directors, and Committees, along with relevant regulations.

June 2023

CEO Ahn Joong HoOVERVIEWOVERVIEWPan Ocean provides differentiated maritime transportation
services with its well-established business capabilities andglobal competitiveness. We will solidify our position as asustainable shipping logistics and agri-trading company
offering safe and high-quality services.

07
11

Company Overview
Business Overview

ESG IMPACTENVIRONMENTAL

SOCIAL

GOVERNANCE

APPENDIX

Company Overview
Business Overview

ESG IMPACTENVIRONMENTAL
SOCIAL

GOVERNANCE

Pan Ocean has been at the forefront of the shipping industry since its establishment in 1966, providing industry-leading shipping services to a diverse range of stakeholders. Our business operations
encompass all areas of shipping, including bulk carriers as our key business, as well as containers, tankers, and LNG carriers. With an extensive seaway network that spans Asia, Europe, the Americas, andOceania, we have forged strong partnerships with major shippers globally, bolstering our global reach. POS SM, a subsidiary of Pan Ocean, provides comprehensive vessel management solutions ranging

from vessel and offshore employees management to new shipbuilding supervision, safety and quality management. Through excellent technologies and rich experience, we strive to make shipping

even safer and more efficient, leading the vessel management industry. We will strive to become the world's leading shipping logistics and agri-trading company by leveraging our exceptional talentand capabilities to deliver differentiated services.

Key Financial Results

Overview(Consolidated financial statements)

Sales

APPENDIX

2020

2021

Establishment
1966.05

Operating Profit

1,146
Employees

1,146 (Onshore/Offshore employees,
as at the end of 2022)

2020

2021

2020

2021
2022

Fleet

(Unit: KRW 100 million)

Total 268
(Owned 110, Chartered 158)

2020

Net Income

2021

2020

2022

2023 PAN OCEAN ESG REPORT

Websitewww.panocean.com

2022

907

Kim Hong Kuk & Ahn Joong Ho

Main Business

Shipping(Bulker, Tanker, Container, LNG)
& Agri-trading(Unit: KRW 100 million

5,493

2021

CEO

2022

7,896

5

104,480,000 tons

5,729

1966

Annual cargo transport

24,971Pan Ocean Co., Ltd.

Head OfficeTower 8, 7 Jongno5-gil,
Jongno-gu, Seoul

2,252

Company Name

46,161

2022(Unit: KRW 100 million)

64,203OVERVIEW

Company Overview

6,771

7

2020

2021

2022

8
OVERVIEW
Company Overview

Company Overview

Vision and Core Values

Business Overview

ESG IMPACTENVIRONMENTAL
SOCIAL

GOVERNANCE
APPENDIXA Future Leader
Pioneering minds

CORE VALUE

that drive the industry forward.

A Partner to Customers

We foster growth alongside our valued
customers and stakeholders,

VISIONcelebrating collective

accomplishments together.

Global Leading Shipping &Logistics Company

A Global Corporate
Citizen that Fulfills Social
Responsibility

Value Creation of Life &Sharing HappinessCorporate Culture that
Respects Talents

We value safety more than anything.

We train talent with specialized expertise andregulations, we pursue

opportunities where they can freely unleash

By complying with environmental laws andsustainable management guided bycorporate social responsibility.

2023 PAN OCEAN ESG REPORTMISSION

diversity, creating an environment of

their capabilities with fair and reasonable
treatment.

9
OVERVIEW
Company Overview
Business Overview

Company Overview
History

ESG IMPACTENVIRONMENTAL
SOCIAL

GOVERNANCE

1960~1980

1980~2000

2000~2019

2020

2021

2022

APPENDIX

1966

1984

2009

Established Pan Ocean
Bulk Carriers Ltd.

Company name changed
to Pan Ocean Shipping Co., Ltd.

Long-term transportation
contract(Vale)

1977

1994

2013

Started a conventional liner
service between Korea andNorth America

First tramp shipping company
in Korea to acquire
ISO/ISM Certification

Company name changed to
Pan Ocean Co., Ltd.

2015

Incorporated as a subsidiaryof Harim Group
Established Agri-Trading &Logistics Department

2017Long-term transportation
contracts(Suzano & Vale)

2023 PAN OCEAN ESG REPORT

2020

Acquired EGT equity
to vitalize agri-trading businessLong-term Time Charter-out
contracts for LNGCswith Shell and Galp

2021

Business expansion into
VLCC market

Business expansion into
LNG bunkering market(Long-term Time Charter-out
contract for
LNGBV with Shell)

2022

Long-term Time Charter-out
contract for 5 LNGCswith Qatar Energy

10
OVERVIEW
Company Overview
Business Overview

Company Overview
Global Network

Pan Ocean is headquartered in Korea and has local and overseas subsidiaries and offices across the globe including Asia, The Americas, Oceania, and Europe.

ESG IMPACT

China (Tianjin)

ENVIRONMENTAL

China (Qingdao)

China (Dalian)

SOCIAL

GOVERNANCE
APPENDIX

Japan (Tokyo)

USA (Portland)

China (Shanghai)
China (Ningbo)

Vietnam (Ho Chi Minh)
China (Shenzhen)
Singapore

USA (Houston)Seoul Head Office

Singapore Subsidiary's
Korea officePohang Office

Australia (Melbourne)
Domestic

Overseas Subsidiaries
2023 PAN OCEAN ESG REPORT

Overseas Office

UAE (Dubai)

USA (New Jersey)

Brazil (São Paulo)
Gwangyang OfficeBusan Office

11
OVERVIEW
Company Overview
Business Overview

ESG IMPACTENVIRONMENTAL
SOCIAL

GOVERNANCE
APPENDIX

Business Overview

As a leading global shipping company, we specialize in providing comprehensive shipping services including bulk carriers as our key business and containers, tankers, heavy lift, and LNG carriers. Byleveraging our extensive experience and expertise in the shipping industry, we have built a robust network that connects key hubs worldwide. We actively explore new business opportunities, such as
agri-trading business and logistics, to fuel our continuous growth. Our ambition is to become a top global shipping and logistics company, constantly seeking innovation and momentum to maintain ourtrusted position in the industry.

PAN OCEAN BUSINESS PORTFOLIO
Sales by business sector

Bulk carriers 69%(As of December 31, 2022)

Agri-trading 11%

Tanker 5%

6

Others 4%
Containers 8 %69%ㆍCape/Panamax
ㆍIron ore
ㆍCoal
ㆍGrain2023 PAN OCEAN ESG REPORT

Bulk carriers

ㆍSupramax/Handy
ㆍSteel/wood products
ㆍMachinery and facilities
ㆍGrain/fertilizer/sugar
ㆍMinerals/wood-pulp

11%Agri-tradingㆍFood/feed grain
ㆍGrain byproducts

LNG 3%

8%

Containers

ㆍIntra-Asia/Far EastㆍContainer cargo

5%

TankerㆍPetroleum products
ㆍOils/fatsㆍCrude oiltrillion

420
Sales

billion KRW

3%

LNG

ㆍLNG
ㆍLNG Bunkering

12
OVERVIEW
Company Overview
Business Overview

ESG IMPACTENVIRONMENTAL
SOCIAL

GOVERNANCE
APPENDIX

Providing Differentiated Shipping Services

Business Overview
Bulker Service

Transportation Services for All Types of Dry Bulk Cargo

As a core business of Pan Ocean, we provide transportation services for various types of dry
bulk cargo, including grains, iron ore, timber, coal, minerals, fertilizers, scrap metals, and more,through global routes. We operate a fleet ranging from Small Handy to Ultramax and VLOC vessels to meet the diverse needs of our customers.

Expanding Worldwide Services Using An Excellent Fleet

Based on more than 50 years of experience in the bulk cargo transportation business, Pan Ocean
has built trust with major shippers around the world. By capitalizing on this competency, we arefocusing on securing more CVC(Consecutive Voyage Charter) contracts with POSCO, HYUNDAISTEEL, domestic power generation companies, major overseas steelworks, and resource devel-

opers, while also expanding short-term SPOT cargo transport contracts that are impervious tomarket fluctuation. Moreover, we are committed to reinforcing local customer-centered marketing activities and ensuring differentiated bulker services to develop new customers. Meanwhile,the strategic portfolio between short- and long-term transportation contracts is promoted to ensure stable growth foundation.
2023 PAN OCEAN ESG REPORT13OVERVIEW
Company Overview
Business Overview

ESG IMPACTENVIRONMENTAL
SOCIAL

GOVERNANCE
APPENDIX

Expanding Intra-Asia Routes Based on Korea-China-Japan Services

Business Overview
Container

Efficient Service and Customer ValueOur container service operates routes covering Korea, Japan, China, and Southeast Asia, solidifying its position as a leading Intra-Asia carrier. We spare no efforts in reinforcing our global network

services to actively respond to customers' diverse demands, ensuring punctual scheduled operations. We will continue to provide differentiated customer satisfaction services through advanced
integrated logistics IT systems and domestic and international networks.

2023 PAN OCEAN ESG REPORT14OVERVIEW
Company Overview
Business Overview

ESG IMPACTENVIRONMENTAL
SOCIAL

GOVERNANCE
APPENDIX

Operation of VLCC and small and medium range tankers

Business Overview
Tanker

Providing High-Quality Tanker Service Using MR Tankers

Expanding Business Foundation

icals, and palm oils. By operating the largest owned fleet of MR tankers and building a solid part-

ther been enhanced by securing two VLCCs in 2021 in addition to the existing fleet of MR tank-

Our tanker service demonstrates on-time delivery of crude oils, petroleum products, petrochemnership with global leading oil majors and traders including EXXON MOBIL, SHELL, and BP, Pan

Ocean has fortified its presence as Korea’s leading tanker service provider. Chemical tanker service safely transports petrochemicals such as benzene, toluene, xylene, base oil, and caustic soda
in the routes of Middle East to Asia, and Far East to Southeast Asia.
2023 PAN OCEAN ESG REPORTIn the tanker service, our crude oil transportation capacity and global competitiveness have furers and chemical tankers. Service routes are also being expanded to U.S West Coast and SouthAmerica beyond the Middle East, Asia, and Oceania. Major customers in the tanker service include

global oil majors such as SHELL, BP, EXXON MOBIL, CHEVRON, and TOTAL and renowned oil trad-

ers such as VITOL, TRAFIGURA, and MERCURIA as well as Korean refiners S-OIL and SK Energy
and food majors such as NONGSHIM, OTTOGI, SAMYANG CORPORATION, CJ, and LOTTE GROUP.
We are making efforts to expand long-term contracts with them based on trust and partnership.

15
OVERVIEW
Company Overview
Business Overview

ESG IMPACTENVIRONMENTAL
SOCIAL

GOVERNANCE
APPENDIXLNG Business Expansion

Business Overview
LNG

Growing as a Global LNG Transportation Operator

Since December 2008, the 153,000 CBM-class LNG carrier "LNG KOLT" has been deployed in Ko-

charter contracts for 174,000 CBM-class vessels with global oil majors such as Shell and Portugal'sof LNG annually from major LNG loading ports in the Middle East such as Yemen, Qatar, Oman, as

project of Qatar, the world's largest LNG exporter, and added vessels under long-term charter con-rea Gas Corporation's (KOGAS) LNG import business. It transports approximately 1,500,000 CBM

well as Southeast Asia, Russia, and Australia to domestic LNG terminals. Recognized for its yearsof experience in LNG vessel operation and management, Pan Ocean has entered into long-term

2023 PAN OCEAN ESG REPORT

largest energy company, GALP, starting from 2020. In 2022, Pan Ocean participated in the first LNGC

tracts. As a result, by the end of 2025, the gas carrier fleet (including LNG bunkering vessels) is expected to expand to 13 vessels.

16
OVERVIEW
Company Overview
Business Overview

ESG IMPACTENVIRONMENTAL
SOCIAL

GOVERNANCE
APPENDIX

Growing as Korea’s No. 1 Grain Trader

Business Overview
Agri-trading

Successfully Advancing Into The Agri Trading

Building A Foundation For Stable Growthmarket by selling over 1.5 million tons of corn, soybeans, barley, and feed wheat annually. Despite

nomic level, considering that over 85% of domestic grain demand relies on imports, with wheat,

After establishing a dedicated organization, we have successfully entered the grain distribution

a short period, we have also ventured into new markets beyond Korea, including China, Taiwan,
and Vietnam. In addition, we plan to continuously explore additional new markets such as Malaysia and Indonesia.

Our entry into the grain distribution business holds significant importance at the national ecocorn, and soybean consumption relying on imports up to 97%. Our Agri-trading and logistics busi-

ness will serve as a future growth driver closely linked to the government's grain procurement
system for food security. To activate the grain distribution business, we acquired shares in thegrain export elevator "EGT" in the US West Coast in September 2020 and will focus on expanding worldwide sales routes utilizing its existing global network. This will establish a stable growth2023 PAN OCEAN ESG REPORT

foundation and enhance our influence in the global grain market.

OVERVIEW

ESG IMPACT

We aim to systematically implement ESG management

activities To secure a foundation for sustainable growth.

From a long-term perspective, Pan Ocean will identify andmanage key sustainability issues, ensuring their ongoing
monitoring and improvement.
182022-2023 ESG Highlights

23

Stakeholder Engagement

19

Materiality Assessment

ESG IMPACTENVIRONMENTAL

SOCIAL

GOVERNANCE

APPENDIX18
OVERVIEWESG IMPACT
2022-2023 ESG Highlights
Materiality Assessment

Stakeholder Engagement

ENVIRONMENTAL
SOCIAL

GOVERNANCE
APPENDIX

2022-2023 ESG Highlights
ECONOMY

Record-Breaking
Operating Profit (38% YoY Increase)(FY 2022)

Built a solid businessfoundation for stable sales
performances

Achieved ‘A’ credit rating(2022. 05 Korea Ratings Corporation, 2023. 06 Korea Investors Service)

Secured financial stability
through robust
business risk management

Global LNG Business
Expansion(2022.06)

Long term charter contract
With QatarEnergy

A

ENVIRONMENTAL
Declaration of 2050
carbon neutrality(2022.08)

SOCIAL

Revamping the education
system by role and job duties(2022.12)

GOVERNANCE

Corporate Governance Charter
Enactment(2022.02)

Commitment to attaining
carbon neutrality by 2050 anddelivering Net Zero solutions toall stakeholders

Induce engagement andpractical skills through therevamp of the education
systemEstablishing a Corporate
Governance Charter for
stakeholder rights and soundgovernanceInitiate Maritime Autonomous
Surface Ship(MASS)
demonstration project

Establishment of Human
Rights Management Policy

Establishment of ESG
Committee

Enhancing Human Rights
Management System andPolicy Integration

Established ESG Committee
within the Board of Directors
for comprehensive andsustainable management at
the board level.

(2022.09)

Participate in the demonstration
project to implement Maritime
Autonomous Surface Ship
(MASS)(2023.06)

ESG(2022.05)

Fuel-saving effects of MASS
Undertake the demonstration
project

Introduction of
Self-compliance Program (CP)Validation of the operational
efficiency improvement and carbon
emission reduction effects of MASS
technology in ship navigation.

Corporate-wide
compliance management
system for voluntarycompliance(2023.03)(2022.06)

Anti-Corruption Program (AP)Enactment of Operational
Regulations(2023.02)

Introduction of Anti-Corruption
Program for Strengthening
Anti-Corruption System
2023 PAN OCEAN ESG REPORTOVERVIEW

ESG IMPACT
2022-2023 ESG Highlights
Materiality Assessment

Stakeholder Engagement

ENVIRONMENTAL
SOCIAL

GOVERNANCE
APPENDIX

Materiality Assessment
Overview and Process of Dual Materiality Assessment

Dual Materiality Assessment Result

holders and to facilitate systematic reporting on sustainable management practices.

tance" and "Financial Importance" was conducted, resulting in the selection of 9 significant issues. Is-

Pan Ocean has conducted a Dual Materiality Assessment to identify issues that are important to its stakeDual materiality refers to considering both the external environmental and social impacts of a com-pany's business activities and the external environmental and social factors that affect the company's
financial condition. It is a tool used to assess the economic value of ESG (Environmental, Social, andGovernance) factors.

Pan Ocean incorporated the concept of dual materiality, which measures the social and environmental
importance and financial importance, to identify key issues related to sustainable management. We as-

sessed the potential impact on both the organization and its stakeholders. International initiatives andguidelines such as GRI, ISO 26000, K-ESG, SDGs, as well as financial-related international recommenda-

tions and ESG evaluation indicators such as DJSI, TCFD, KCGS, SASB, and EcoVadis, were actively utilized
in the process.

Based on the derived ESG Issue Pool, a quantitative measurement of "Environmental and Social Imporsues related to the environment, such as "Climate Change Response" and "Greenhouse Gas and Energy

Management," were identified alongside social issues including "Enhanced Safety and Health Management" and "Establishment of Human Rights Management System," classified as core issues.
Secure and Foster Talents
Air Pollution Control

Ethical and Compliance Management

Climate Change Response

GHG and Energy Management

Enhance Anti-Corruption Activities

Establishment of Human Rights Management System
Sustainable Business Governance

Strengthen OSH Management

Environmental and Social Importance

19

Financial Importance

Step 1. ESG Issue Pooling

ㆍFormation of 56 potential issue pool based on analysis
of international initiatives, guidelines, ESG evaluation indicators, as well as analysis of leading global companies
and industry peers

ㆍDerivation of 24 ESG issue pools through analysis ofprevious year's issues and internal consultations

2023 PAN OCEAN ESG REPORTStep 2-1. Social andEnvironmental Impact Analysis

ㆍGlobal initiatives and standards analysis- Incorporate International Standard Indicatorssuch as
GRI, ISO 26000, K-ESG, UN SDGs
ㆍMedia analysis-A nalyze 224 articles on environmental, social, and economic performance and ESG issues (Period: 2022.01.01- 2022.12.31)
ㆍBenchmarking-B enchmark 16 leading domestic and international peer
companies
ㆍEngagement with External Stakeholders-A nalyze ESG issue and gather opinions from customers,
shareholders/investors, business partners, and local
communities(Survey Period: 2023.03.09 – 2023.03.17)

Step 2-2. Financial Impact Analysis

Step 3. Core Issues Identified

ㆍAnalysis of Financial International Standards Recommendations and ESG Rating Organizations

ㆍQuantitative Assessment Conducted on the Environmental and Social Impact as well as Financial Impactof each issue-A nalyze DJSI, SASB, TCFD, EcoVadis,- KCGS evaluation indicators

ㆍStakeholder Survey- Survey
of internal and external stakeholders on Pan
Ocean’s sustainable management (Survey Period:
2023.3.07 - 2023.03.17)

ㆍSelection of nine core issues

20
OVERVIEWESG IMPACT
2022-2023 ESG Highlights
Materiality Assessment

Materiality Assessment
Material Topic Management
No.

Material issues

Stakeholder Engagement

ENVIRONMENTAL
SOCIAL

1

GOVERNANCE

Strengthen
OSH
Management

Impact in sustainability context

Providing safety and security is our utmost responsibility to protect employees. In
particular, the offshore work environment involves higher risks for injuries, hence evenmore careful approaches are needed. Furthermore, there is a potential for loss of life andenvironmental pollution in the event of a maritime accident. Therefore, it is crucial toestablish a fundamental accident prevention system to ensure the safety of members
and adhere to environmental responsibilities. Efforts are needed to promote zero serious
accidents and proactively identify safety and health risks to improve hazards and risk
factors.

APPENDIX

2

32023 PAN OCEAN ESG REPORTAir Pollution
Control

GHG and
EnergyManagement

With the tightening regulations on nitrogen oxides and sulfur oxides emissions inmajor ports, the classification of air pollutants is becoming more specific based on
their respective sources of pollution. We take proactive measures to actively monitor
and manage the air pollutants emitted from our vessels in real-time. Our commitment
to reducing air pollutants includes the use of low-sulfur fuel oil, installation of scrubber
systems, and implementation of other effective measures.

The world has now reached a climate crisis that goes beyond climate change, as it isaccompanied by consequences such as rising sea levels, increasing ocean temperatures,and changes in ecosystems, all stemming from greenhouse gas emissions. Therefore,
greenhouse gas reduction and energy efficiency management are not only challenges
but also obligations for all companies that emit greenhouse gases through theirbusiness operations. In particular, shipping has a significant impact on climate change
and is directly affected by irregular natural phenomena that occur. Furthermore, with
the inclusion of the shipping industry in the EU ETS, there are financial implications
associated with the cost of emission allowances trading. In addition, companies that
do not actively participate in climate change mitigation are increasingly at risk of being
excluded from investment opportunities due to their perceived low contribution tosustainability. Greenhouse gas and energy management are important tasks for Pan
Ocean in terms of securing investors and fulfilling environmental responsibilities.

Activity and Performance
Year
2020
2021
2022

Year

Lost time incidentrate(LTIFR)(Onshore) 1.13

(Offshore) 5.97
(Onshore) 0(Offshore) 4.07
(Onshore) 0(Offshore) 4.63

NOx (Kg)

Deaths(people)2022

SOx (Kg)-

ㆍGRI 302
ㆍGRI 305

26, 35-36,
87

8,438,785

GHG emission
intensity(tCO2eq/KRW
100 million)

Energy intensity(TOE/KRW 100
million)67.77621.73346.83129, 880

8,382,249

113.346ㆍGRI 305-7

071,249,1202021

ㆍSafety and Health Policy
for offshore employees
ㆍSafety and Health Policy
for onshore employees

0

2022

2020

57-65, 94

07,511,958

Year

Documents

ㆍGRI 403

063,851,643
71,729,675

Page

0

2020
2021

ESG indicators

36.07014.890

ㆍEnvironmental
Management Policy

21
OVERVIEWESG IMPACT
2022-2023 ESG Highlights
Materiality Assessment

Materiality Assessment
Material Topic Management
No.

Material issues

Stakeholder Engagement

ENVIRONMENTAL
SOCIAL

4

GOVERNANCE

ClimateChangeResponse

APPENDIX

5

62023 PAN OCEAN ESG REPORT

Establishmentof HumanRightsManagement
SystemEthical andComplianceManagement

Impact in sustainability context

Activity and Performance

As a situation is emerging where a temperature rise of 1.5°C is expected within the next 20
years compared to pre-industrial levels, there is an urgent need for rapid climate change
mitigation. Pan Ocean is facing demands from stakeholders to concretize and implement
Net Zero targets. Various investment and evaluation institutions require companies to
set specific short-term Net Zero goals, disclose their reduction performance, enhance
the alignment between Net Zero achievements and management KPIs, and provide
comprehensive plans for attaining Net Zero, including investment costs for different
mitigation options. In response to these demands, Pan Ocean is fully committed toestablishing and implementing the Road to Decarbonisation, aligning with stakeholders'
expectations.

ㆍTotal emissions reduced by 88,380 tCO2eq

By implementing human rights management, businesses can not only reduce the risks
associated with human rights violations but also enhance sustainability and improve
competitiveness. Pan Ocean has established a human rights management policy toensure the integration and enhancement of human rights within the organization.
We have set specific medium to long-term goals, including conducting human rights
assessments and implementing remedial measures, to strengthen our commitment tohuman rights management.

ㆍHuman Rights Management Policy

Responsible ethical management and compliance are linked to various risks that cansignificantly impact our survival, including reputation, market competitiveness, andhuman rights. The level of responsibility and expectations from evaluation groups,
investors, and customers is continuously rising, accompanied by increasingly stringent
laws and regulations. Failure to meet these expectations can result in financial penalties,
loss of social credibility, and internal concerns. Therefore, it is imperative to ensure
thorough compliance with all relevant laws and regulations pertaining to anti-corruption,
fair trade, and workplace bullying prevention. Pan Ocean has implemented the SelfCompliance Program(CP) to proactively prevent potential risks and enable immediate
responses to unethical conduct.

compared to 2021, with a 31% reduction in

ESG indicators

Page

Documents

ㆍGRI 305

37-41

-

ㆍGRI 405, 406, 407, 408,
409, 411

43-44

ㆍHuman Rights
Management

ㆍGRI 2-27
ㆍGRI 205

76-79

ㆍCharter of Ethics
ㆍCode of Ethics
ㆍEthical Management
Guidelines

emissions intensity

established in June 2023

Year
2020
2021
2022

% ethics/
compliancepledge signed% voluntarycompliancereview conducted

99.6%

100%

99.4%
99.7%

100%
100%

ㆍImplementation of the Self-compliance
Program (CP) in June 2022

22
OVERVIEWESG IMPACT
2022-2023 ESG Highlights
Materiality Assessment

Materiality Assessment
Material Topic Management
No.

Material issues

Stakeholder Engagement

ENVIRONMENTAL
SOCIAL

GOVERNANCE

7

Secure andFosterTalents

APPENDIX

892023 PAN OCEAN ESG REPORT

Enhance
AntiCorruption
Activities

Establishmentof Sustainable
Business
GovernanceImpact in sustainability context

The growth and happiness of our employees directly contribute to the development of
Pan Ocean. As the competitiveness of a company begins with securing and continuously
managing its talent pool, we have a clear responsibility to ensure the capacity
development and quality of life of its employees. In the case of our company, long-term
talent acquisition is especially important for business continuity, and constant attention
should be given to prevent talent attrition and loss. It is necessary to establish medium
to long-term workforce planning and take sincere considerations and practical actions
to address the concerns of employees. Moreover, securing and retaining innovative
talents with diverse capabilities is not only crucial for the growth of Pan Ocean but also
has a positive social impact in terms of creating new jobs. Therefore, the entire process oftalent management, from recruitment to development, retention, and re-employment
support, is essential for our sustainable growth and fulfillment of social responsibilities.

Activity and PerformanceYear

New hires
Voluntary(people) resignation (%)

2020
2021
2022

206
235
169

(Onshore) 2.5(Offshore) 8.9(Onshore) 3.1
Offshore) 6.8(Onshore) 4.9(Offshore) 8.6

Training
costs(KRW 100
million)ESG indicators

Page

ㆍGRI 401,404

45-56

ㆍGRI 205 (Anti-corruption)

78

ㆍGRI 2-14
ㆍGRI 2-22

70-72

Documents
-

2.8
4.0
3.4
5.2
4.2
5.6

Through effective human rights management, companies can mitigate the risks
associated with human rights violations and enhance their sustainability andcompetitiveness. We are committed to internalizing and strengthening our humanrights management system. We have established a comprehensive human rights
management policy and implemented measures such as human rights assessments
and remedial actions. By setting specific medium to long-term goals, we aim to further
enhance our human rights management practices.

ㆍCompleted risk assessment and mitigation

External stakeholders, including evaluators, shareholders, investors, and customers,
have high expectations for our company's ESG activities and achievements. The shift
towards non-financial performance criteria, such as environmental impact and humanrights, underscores the significance of ESG management for our business's survivaland growth. To ensure the integration of sustainable management into our company's
policies, the board of directors must assume leadership roles within the governancestructure. However, it is crucial to foster consensus among all employees, as sustainable
management requires their active engagement and contributions. Building companywide consensus and developing an interconnected ESG strategic system aligned with
our medium to long-term strategic directions are essential for success.

ㆍESG Committee operated within the Board

measures for a total of 48 items across five-categories of corruption risks

of Directors

ㆍESG Committee
Operation Rules
ㆍESG FinanceManagement System

23
OVERVIEWESG IMPACT
2022-2023 ESG Highlights

Stakeholder Engagement

Pan Ocean defines stakeholders as employees, customers, business partners, shareholders/investors, and local communities. We actively gather the interests and opinions of each group through various

channels and have incorporated stakeholder input into our Materiality Assessment. Furthermore, we will continue to identify and prioritize issues that are of high interest and impact to stakeholders,
ensuring smooth communication and engagement with them.

Materiality Assessment

PAN OCEAN STAKEHOLDERS

Stakeholder Engagement

ENVIRONMENTAL
SOCIAL

GOVERNANCE
APPENDIX

Employees

Communication channels

ㆍLabor-Management Council
ㆍGrievance settlement system
ㆍEmployee satisfaction survey
ㆍIntranet, company messenger
ㆍCompany newsletter

Topics of interestㆍAttracting and retaining talentㆍOperating diverse welfare
programs
ㆍSupporting competency development and growthㆍImproving working environmentand organizational culture
ㆍProtecting human rights andrespecting diversity

2023 PAN OCEAN ESG REPORT

Customers

Communication channels

ㆍWebsiteㆍHelp Line

Topics of interestㆍColleting Customer Feedback andOpinions
ㆍProviding High-quality Service

Suppliers

Communication channels

ㆍPurchase Portal website
ㆍHelp Line

Topics of interest

ㆍFair selection and evaluation
ㆍEstablishment of relationships forshared growthㆍCompliance with laws andregulations

Local communities

Communication channels

ㆍSeoul Senior Welfare CenterㆍSeoul National Cemetery

Topics of interest

ㆍVitalizing the local economyㆍSupporting the socially vulnerable
ㆍFulfilling its environmental
responsibility
ㆍExpanding social infrastructure

Shareholders/investors

Communication channels

ㆍGeneral shareholders meeting
ㆍIRㆍDisclosuresㆍMeetings and conferences

Topics of interest

ㆍBusiness performance and financial information disclosures
ㆍVitalize Communications with
Shareholders
ㆍTransparent disclosure of thegovernance system
ㆍPursuit of ethical and compliancemanagement

OVERVIEWENVIRONMENTAL
It is vital that corporates make commitments to the environment andrespond to the climate crisis and sustainable future.

Pan Ocean takes preemptive measures and actively responds toresolve environmental issues.
25

Establishment of Environmental Management System

32

Investment in Green Vessels

29
35
37

Environmental Impact Management

Greenhouse Gas and Energy Management
Climate Change Response

ESG IMPACTENVIRONMENTAL

SOCIAL

GOVERNANCE

APPENDIX

25
OVERVIEWESG IMPACTENVIRONMENTAL
Establishment ofEnvironmental
Management System
Environmental
Impact Management
Investment inGreen Vessels

Greenhouse Gas andEnergy Management
Climate Change Response

Establishment of Environmental Management System
VISIONPan Ocean is committed to efforts for marine environmental protection, biodiversity conservation, and prevention of air pollution. Our goals include reducing emissions of air pollutants, carbon emis-

sions, and introducing environmentally friendly technologies to pursue sustainable development. Additionally, we strive for effective communication with stakeholders to ensure empathy and capability
to address environmental issues, aiming for both nature conservation and sustainable growth.

Core Issues and Objectives Pursued Strategy

Core Issues

SOCIAL

Climate Change Response

GOVERNANCE
APPENDIX

Response Strategies
andObjectives

Specific Plans

2023 PAN OCEAN ESG REPORT

2030 Carbon Reduction,
2050 Net Zero

Protection of Marine Environment andConservation of biodiversity

Reduction ofnegative impacts on marine
environment and biodiversity.
10% reduction in average ship
waste generationfrom 2018 to 2020 by 2025

Prevention of Air Pollution

Reduction of air pollutants
emitted from ships.

12% reduction in SOx and NOx
emissions compared to2021 by 2030

ㆍCompliance with maritime regulations.

ㆍWaste reduction

ㆍReduction of NOx emissions

ㆍOptimize navigation patterns for
improved efficiency

ㆍResource circulation

ㆍReduction of air pollutant emissions
during port timeㆍTransition to carbon-neutral vessels

ㆍReplace with high-efficiency fleet andintroduce ESD equipment

ㆍInstall ballast water management systems
ㆍBiofouling control
ㆍVessel recycling

ㆍReduction of SOx emissions

26
OVERVIEWESG IMPACTENVIRONMENTAL
Establishment ofEnvironmental
Management System
Environmental
Impact Management
Investment inGreen Vessels

Greenhouse Gas andEnergy Management
Climate Change Response

SOCIAL

GOVERNANCE
APPENDIX

Establishment of Environmental Management System
Environmental Management Policy

Since the establishment of the environmental management policy in 2012, we have been continuously making efforts to strengthen theenvironmental management system. We annually establish specific environmental goals and plans in accordance with our policy and im-

Pan Ocean Environmental Management Policy

Environmental Management System

2. W
 e proactively pursue carbon neutrality and leadthe industry's future.

plement them to create a sustainable environment for future generations and become an environmentally friendly company.

We pursue safe vessel operations and environmentally friendly transportation services. For more organized environmental management, we obtained the ISO14001 certification in 2010 and have maintained it since then. POS SM also retains the certification.

We manage overall environmental impact through the PDCA (Plan-Do-Check-Action) cycle. In order to enhance our environmental
management, we conduct improvement activities ranging from planning and implementing environmental goals to environmental

education, monitoring, taking corrective measures for noncompliance, and managerial review. The Maritime Environment Teamis exclusively responsible for environmental management and dedicated to maintaining the environmental management system.

Environmental Impact Assessment

We conduct annual environmental impact assessments to predict and analyze the impact of Pan Ocean’s business activities on environment and prevent environmental pollution in advance. The severity of environmental impact is calculated by combining the like-lihood of each environmental risk and potential consequences. Aspects identified to have significant environmental impact based

1. We aim to provide sustainable maritime services.

3. W
 e continue our efforts to protect marine environments and preserve biodiversity.
4. We strive to reduce emissions of air pollutants andcomply with relevant regulations.

5. W
 e maintain ongoing communication with stakeholders to ensure empathy and responsiveness toenvironmental issues.

ISO14001 Certificateson the level of severity are taken into consideration in establishing the following year’s environmental goals.

Environmental Impact Assessment Result
Category

Climate change
Regulations on Fossil Fuel
Usage

Increased frequency of tropical
cyclones

2023 PAN OCEAN ESG REPORTStrengthening egulations on LowerGrade Vessels and the Growing
Importance of Scope 3 Management

ImpactㆍIncreased capital investment

Response

ㆍTimely implementation of Engine Power Limitation (EPL) andminimizing operational delays

ㆍIntroduction of carbon tax and increased costs due
to emission trading system

ㆍCollaborate with long-term charterers and shipowners tomanage emissions allowances and address pricing risks.
ㆍDevelop an EU ETS management system

ㆍIncreasing risk of vessel accidents

ㆍDevelopment and operation of vessel and weather monitoring
systemㆍDecline competitiveness of vessels as decrease infossil fuel transportation

ㆍIncreasing demand for high-efficiency vessels

ㆍExpansion of investment in LNG transportation and LNG
bunkeringㆍIntroduction of high-efficiency vessels and installation ofEnergy Saving Devices (ESDs)

Pan Ocean

POS SM

27
OVERVIEWESG IMPACTENVIRONMENTAL
Establishment ofEnvironmental
Management System
Environmental
Impact Management
Investment inGreen Vessels

Greenhouse Gas andEnergy Management
Climate Change Response

SOCIAL

GOVERNANCE
APPENDIX

Establishment of Environmental Management System
Conducting Environmental Training

Issuing Green Bonds

ronmental awareness, while sharing pertinent information on environmental laws and regulations to ensure strict

with a size of 50 billion KRW. We have maintained G1 certification, the high-We conduct annual environmental training sessions to promote employees' understanding and integration of envicompliance. In particular, we regularly conduct marine pollution prevention education based on the Environment

Management System (EMS) manual. Our offshore employees undergo onboard on-the-job training (OJT), computer-based training programs, and drills to enhance their knowledge and preparedness. Preembarkation job training

and onshore safety quality meetings serve as fundamental pillars for the ongoing and systematic management of ma-rine pollution prevention. Moreover, we provide our employees with opportunities to receive training on greenhousegas (GHG) and energy regulations, clean fuel technologies, and emerging industries such as green vessels, fostering a
corporate-wide consensus on environmental management.

Environmental training for onshore and offshore employees
Onshore employee

ㆍAlternative fuel and alternative fuel-powered vessel market status
ㆍGlobal decarbonization trends in shippingㆍImpact of IMO/EU Environmental Regulation and Countermeasures

est rating for ESG green bonds, as recognized by Korea Ratings. The funds

secured through the bond issuance have been invested in the introductionof environmentally friendly ship fuel (LNG), leading to a reduction in environ-mental pollutants. They have also been utilized for the installation of ballast
water management systems, contributing to the conservation of biodiversity. We adhere to the principles outlined in our ESG financial management
system to identify and evaluate investment projects. Going forward, we plan

to fully invest in ESG projects that are expected to have positive environmenOffshore employee

ㆍEnvironmental pollution prevention training for Chief Officer/Engineer
ㆍEnvironmental pollution prevention training for personnel boarding
vessels carrying hazardous liquid substances

Compliance with Environmental Laws and Regulations

We proactively assess our legal and regulatory compliance to ensure full adherence to all applicable laws and regulations

governing the shipping industry. Our approach is guided by the rules outlined in the International Maritime Organization's (IMO) MARPOL convention, as well as the latest local and international environmental regulations, including regu-

lations pertaining to vessel greenhouse gas (GHG) reduction. We report key compliance response measures and progressto the Risk Management Committee, ensuring the maintenance of an efficient compliance management system.

Green Products Purchase and Use

To minimize the environmental impact caused by vessels, we purchase and promote eco-friendly products such as environmen-

tally acceptable lubricants (EALs) and biodegradable chemicals for vessels’ consumables. We adhere to the standards of environmentally acceptable luboil and biodegradable chemicals set by the U.S. Environmental Protection Agency and distribute them.
2023 PAN OCEAN ESG REPORT

We have issued the first-ever green bond in the domestic shipping industry

Furthermore, we plan to progressively expand the range of eco-friendly products among the supplies provided to ships.

tal effects.

Violation of Environmental Regulations
Category

2020

0

Cases

2021

0

Green products purchase track records

0(Unit: KRW million)

Category

2020

2021

Green
lubricants

172

264

269

Green
chemicals

29

36

59 Biodegradable product purchases

201

300

328

47,11257,19782,894

0.4%

0.5%

0.4%

Green productpurchases
Total
purchases% greenproduct
purchases

2022 Remark

2022

Environmental Acceptable Lubricants(EALs) purchases according to the U.S.
Environmental Protection Agency
Standards

Green product purchases/totalpurchases

28
OVERVIEWESG IMPACTENVIRONMENTAL
Establishment ofEnvironmental
Management System
Environmental
Impact Management
Investment inGreen Vessels

Greenhouse Gas andEnergy Management
Climate Change Response

SOCIAL

GOVERNANCE
APPENDIX

Establishment of Environmental Management System
Targets and Indicators

We have established and implemented plans to attain our environmental and climate change response targets. To ensure effective performance management, we define indicators for annual evaluations and identify areas for improvement through thorough audit processes, including internal and external reviews. By proactively operating our environmental management system, we aim to continuously enhance our environmental performance.

2022

KPI

Zero use of off-spec fuel oil

0 CaseTargetResult3 Cases

GHG emissions [tCO2eq] (Scope1)

2,503,830

2,669,080

Energy consumption [TOE]829,919

848,790

Amount of oil waste (bilge) [m3/vessel]

185.79136.11

Emission intensity [gCO2/ton∙ mile]
Amount of oil waste (sludge) [m3/vessel]
ZERO regulatory violations

Investment in environmental facilities
Details

Sample tests for every fuel supply

Pre-confirmation of ON-SPEC status by securing
product specifications from major suppliers

Vessel Performance Data Update

Implementation of slow steaming

Key regulation seminars

Reporting on trends (IMO, EU)

Establishment of Greenhouse Gas Emissions
Monitoring System in response to IMO CII rating
regulations

BWMS installation

Implementation of EPL measures in response to IMOEEXI regulations*2023 PAN OCEAN ESG REPORT

2023

5.94

10.75

0 Case190 million
TargetZero Cases

6 times per quarter
Biannual

90%

Biannual

Biannual+
System development
15 vessels

EPL implementation

6.02

14.66

0 Case202 million
ResultZero Cases

Securing productspecifications inprogress

Update in Oct.

87%

2 sessions

3 sessions

CII Rating Monitoring
System Development
completed

17 vessels-*D elay in approval of EPL (Engine Power Limitation) provider and considering speed restrictions after EPL implementation, postponing it
to 2023

Category
Climate Change
Response
MarineEnvironment
Conservation

Biodiversity
Conservation
Air Pollution
Prevention

Category
Climate Change
Response
MarineEnvironment
Conservation
Biodiversity
Conservation
Air Pollution
Prevention

KPI

TargetGHG emissions (Scope1)

2,481,640 tCO2eq

Energy consumption

829,641 TOE

Amount of Oil Waste (bilge)

181.92 m3/vessel

Emission intensity (Vessel)

Amount of Oil Waste (sludge)

6.11 gCO2/ton∙ mile

10.53 m3/vessel

Additional measures in accordance with international regulations and requirements

NOx emissions

68,418 ton

SOx emissions

8,043 ton
Activity

Enhancement of CII system
Development of EU ETS monitoring system

Development of greenhouse gas inventory management system

Eco-friendly automobiles
Amount of Oil Waste (sludge)
Amount of Oil Waste (bilge)
Plastics
Vessels refrigerant usage
Food waste
Zero marine pollution accidents
BWMS installation
Implementation of Hull Cleaning
NOx reduction devices (SCR) installation
Conduct fuel oil sample test

Supplier
Evaluation of Suppliers
Management
andCompliance withEnvironment-friendly social contribution activities
Initiatives

TargetDevelopment within the first half of the year
Development of a cost calculation system

Development within the year
Introduction of 3 hybrid vehicles
10.53 m3 (Avg. per vessel)
181.92 m3 (Avg. per vessel)
11.82 m3 (Avg. per vessel)
66.06 kg (Avg. per vessel)
2.89 m3 (Avg. per vessel)
0 Case7 vessels
70 times
1 vessel
Implementation of bunkering at eachbunkering session
Introduction of self-environmental
management evaluation scores,
evaluated twiceㆍEco-clean Volunteer work 24 sessions
ㆍSeoul National Cemeteryenvironmental cleanup twice

29
OVERVIEWESG IMPACTENVIRONMENTAL
Establishment ofEnvironmental
Management System

Environmental
Impact Management
Investment inGreen Vessels

Greenhouse Gas andEnergy Management
Climate Change Response

SOCIAL

GOVERNANCE
APPENDIX

Environmental Impact Management
Harmful Chemicals Management

Air Pollutants Management

In accordance with the IMDG Code* and the International Code for the Construction and Equip-

Bunker C fuel, which is used as a ship fuel, emits sulfur compounds during the combustion pro-

Identifying Harmful Chemicals

ment of Ships Carrying Dangerous Chemicals in Bulk (IBC Code), we classify and manage substances that are explosive, flammable, toxic, corrosive, or marine pollutants as hazardous chemicals. These substances have the potential to directly affect people, cargo on board, and themarine environment. Specifically, for chemicals and cleaners that may have adverse effects on

the marine environment, we procure and utilize green products certified by the IMO. This is partof our comprehensive approach to control harmful chemicals.

* IMDG Code: International Maritime Dangerous Goods Code adopted by the IMO and applicable to dangerous substances packed and shipped
via the sea.

Inspection and Management of Harmful Chemicals

Extra precautions are taken to prevent accidents during the transportation and storage of hazard-

cess, which is one of the three major air pollutants and a significant contributor to respiratory

diseases and particulate matter. In response to this, the International Maritime Organization (IMO)
has implemented regulations on sulfur content in vessel fuels. Since January 2020, Pan Ocean
has been supplying low sulfur fuel with a sulfur content of less than 0.5% as the main fuel.

Scrubber (Desulferizer) Installation

We have installed scrubbers in 76% of our Capesize vessels that consume the largest amount offuel in our fleet. This system allows us to monitor sulfur oxides emissions from the vessels in realtime. By applying procedure-based control, we strive to reduce sulfur oxide emissions.

ous chemicals. For bulk hazardous chemicals, we adhere to stringent procedures that include car-

Alternative Maritime Power (AMP)

management of void spaces. Daily inspections and documentation are carried out for transpor-

in two vessels. The AMP supplies power from land to the vessel while anchored in the port. Thisgo temperature checks, the use of inhibitors, monitoring of oxygen levels in tanks, and thoroughtation and storage activities. The processes for managing hazardous chemicals undergo internaland external validity reviews twice a year.

Handling of Harmful Chemicals

We perform preliminary screening for all chemicals used, assessing their characteristics, hazards,

and emergency response procedures. Packaged harmful chemicals are categorized into nineclasses, while bulk chemicals are classified into five classes, and we implement appropriate isolation and separation measures accordingly. We also conduct thorough checks to identify any

restricted or prohibited items. To ensure safety, we have a Personal Protective Equipment (PPE)

matrix in place, specifying the required PPE based on specific situations. Handling of harmful
chemicals is carried out in accordance with the guidelines provided in the Material Safety Data
2023 PAN OCEAN ESG REPORT

Using Low Sulfur Fuel Oil

Sheets (MSDS) under the Occupational Safety and Health Act.

To reduce fine dust from vessels at anchor, we installed Alternative Maritime Power (AMP) systemsystem is used to reduce air pollutant emissions from power generation using vessel fuel.

30
OVERVIEWESG IMPACTENVIRONMENTAL
Establishment ofEnvironmental
Management System

Environmental
Impact Management
Investment inGreen Vessels

Greenhouse Gas andEnergy Management
Climate Change Response

SOCIAL

GOVERNANCE
APPENDIX

Environmental Impact Management
Waste Management

We established a waste management manual to minimize waste generation and facilitate recycling. We also asked waste disposal services to apply the same standards to ensure waste management inaccordance with international rules, including the International Safety Management Code (ISM Code) and the requirements of MARPOL and Pan Ocean. We ensure thorough management and monitoring with the ultimate goal of preventing pollution by minimizing waste disposal.

General Waste

For general waste from vessels, the entire waste treatment process, including documentation, collection, separation,

storage, and disposal, is monitored to ensure proper treatment in compliance with international agreements. We havealso established waste disposal targets and review whether the targets are met. We encourage the use of onboard
incinerators to minimize waste discharged to land and water, and we supply plastic shredders and presses to facilitate
waste recycling.

Oil Waste

In accordance with our SHEQ manual, the disposal of onboard waste and oil waste (Bilge, Oily bilge, Sludge) is strictly and meticulously managed. We closely monitor and document the generation and treatment of oil waste (bilge,
oily bilge, and sludge) to ensure compliance with international standards. Our fleet is equipped with an autonomous

Environment Tag System (ETS) for monitoring proper oil waste management. Furthermore, we plan to evaluate standardized criteria such as environmental standards and relevant port permits to centrally select oil waste disposal companies for key port calls. This initiative aims to ensure consistent utilization across all vessels.

Packing Material Waste

To reduce packing material waste from goods loaded onboard, we encourage businesses to minimize packing materials unless necessary to prevent damage. As part of our waste management process, we work with suppliers to ensurethat recyclable packing materials are immediately collected or recycled.

2023 PAN OCEAN ESG REPORT

Vessel Recycling
Green Recycling Policy

ㆍPan Ocean complies with vessel recycling rules. Our fleet has the Inventory of Hazardous Materials (IHM) furnished onboard. The IHM
helps ensure the safety and health of workers in the dismantlingprocess and prevents pollution.
ㆍTo prevent vessels from being recycled under poor environmental
conditions, we have established the Green Recycling Policy. Under
this policy, we only utilize yards that are accredited by the Korean
Register, following the guidelines set by the Hong Kong International Convention for the Safe and Environmentally Sound Recycling of Ships.
ㆍWe consider and implement the safest and most environmentallyfriendly vessel recycling policies to protect the marine environment
and the rights of workers.

31
OVERVIEWESG IMPACTENVIRONMENTAL
Establishment ofEnvironmental
Management System

Environmental
Impact Management
Investment inGreen Vessels

Greenhouse Gas andEnergy Management

Environmental Impact Management
Conservation of Biodiversity

Water Resource Management

Ballast water is either stored in the ballast tank of a vessel or discharged into the seas to ensure the safe operation of the vessel. How-Pan Ocean systematically manages and controls the discharge

BWMS Installation

ever, this process can lead to the introduction of microorganisms that may disrupt the marine ecosystem. To address this concern,

the IMO implemented the Ballast Water Management System (BWMS) in September 2017, which is designed to sterilize and remove
microorganisms from ballast water.

Pan Ocean has been installing ballast water treatment systems on its vessels since 2016, before the regulations came into effect. The
disinfection process and results of the discharged ballast water are monitored in real-time. As of the end of June 2023, the installation
has been completed on a total of 105 vessels, and it is planned to expand the installation to all vessels by 2025.

Climate Change Response

Fouling Prevention

SOCIAL

caused by foreign species attached to the hull of internationally operating vessels, we ensure regular cleaning of the vessel surface

GOVERNANCE
APPENDIX

We employ a range of measures to preserve marine biodiversity and protect the ecosystem. To prevent the disruption of ecosystems

and application of anti-fouling paints whenever vessels enter the dock. Furthermore, vessels at sea adhere to procedures for regularinspections of hull surfaces to detect and address contamination and damages. Furthermore, Pan Ocean is making efforts to prevent
marine growth by installing Marine Growth Preventing Systems (MGPS) at seawater inlets on its vessels. Managers are assigned toregularly maintain and manage these systems. These measures aim to prevent the colonization of marine organisms and promote

Vessel Drainwater Managementof effluent to minimize the marine environmental impact re-sulting from vessel operations. For the discharged cleaningwater, which is treated using exhaust gas scrubbers to reduce
sulfur oxides, parameters such as pH, turbidity, PAH, andnitrate levels are measured and monitored in real-time. Additionally, monitoring data is continuously accumulated andmanaged in an integrated manner.

Gray water and wastewater from vessels are processed
through vessel wastewater treatment systems to ensure ster-ilization prior to discharge. If sterilization is not possible, thewater is stored in separate holding tanks. We actively engage
in marine water resource management in full compliance withinternational agreements and regulations.

the preservation of marine ecosystems.

Environmental impact of ballast water discharge
Scope of impact

All ports around the world depending on vessel operation routes

Key impact

Introduction of alien species, dissemination of harmful marineorganism/pathogens

Level of impact

2023 PAN OCEAN ESG REPORT

Response

More than 10 billion tons of ballast water transported annually, leading tomore than 7,000 marine species moving globally
Installing BWMS to sterilize eliminate organisms and microorganisms inballast water in all vessels

BWMS Installation Records and Plans

2016-2022
101

2023

7

2024

14

(Unit: vessels)

2025

Install on All Vessels by 2025

3

32
OVERVIEWESG IMPACTENVIRONMENTAL
Establishment ofEnvironmental
Management System
Environmental
Impact Management
Investment inGreen Vessels

Greenhouse Gas andEnergy Management
Climate Change Response

Investment in Green Vessels
Introduction of Advanced Green Systems
Vessel Operation Optimization System

Applying Rotor Sail Systems

mization system. Through the e-Center, basic data collected for each vessel, including location, speed, route, and fuel consumption,

sion device, the Rotor Sail System (RTS), to the large bulk carrier,In 2022, Pan Ocean and POS SM established the Fleet Operation e-Center, their own control center, to enhance ship operation optiis integrated and monitored in real-time, enabling swift bi-directional information exchange between land and sea. Utilizing the col-lected data, analysis of voyage-specific operational efficiency and vessel speed performance is conducted to derive optimal routes,
ensuring efficient ship operations. Furthermore, the system is designed to prevent major accidents and incidents and facilitate immediate response in case of emergencies. We also manage the vessel's Carbon Intensity Indicator (CII) rating through CII reports andsimulators, preparing for potential rating changes. In addition, AI technology is applied to analyze CCTV data in real-time, enabling
early identification and prevention of potential risks within the vessel, such as abnormal conditions of offshore employees or fire

detection in engine rooms. We strive to effectively utilize advanced IT technology to manage and analyze ship big data, preparing for
the upcoming Fourth Industrial Revolution.

in Korea to adopt such a system. The Rotor Sail System is an envi-

ronmentally-friendly auxiliary propulsion system that harnesses
wind energy by rotating a vertical cylindrical column, providing

additional thrust and enabling fuel savings and a reduction incarbon dioxide emissions. Additionally, in collaboration with POS
SM and the Korean Register of Shipping, we have signed a "Joint

Research Agreement for Environmental Regulation Compliance"

ly energy-saving device that reduces ship frictional resistance.

GOVERNANCE

Through this research, the effectiveness of energy-saving devices

will be validated based on actual operational data, and strategies

Fleet Operation e-Center

Vessel Voyage-specificOperational Efficiency Analysis

to maximize their utilization will be established.

"Optimized Passage Plan
Review and Route Navigation

Operational Efficiency Management System

2023 PAN OCEAN ESG REPORTSEA ZHOUSHAN, making it the first domestic and foreign vessel

to develop the Air Lubrication System, an environmentally friend-

SOCIALAPPENDIXPan Ocean has introduced the environmentally friendly propul-

Vessel SPEED Performance
Analysise-Center Control RoomSEA ZHOUSHAN with RTS

33
OVERVIEWESG IMPACTENVIRONMENTAL
Establishment ofEnvironmental
Management System
Environmental
Impact Management
Investment inGreen Vessels

Greenhouse Gas andEnergy Management
Climate Change Response

SOCIAL

GOVERNANCE
APPENDIX

Investment in Green Vessels
Establishment of Foundation for Green Vessels
Development of MASS Technology

Fuel/GHG Emission Reduction and Its Verification by Autonomous Navigationin vessel technology, integrating artificial intelligence, the Internet of Things, bigness of fuel savings through the operation of an autonomous navigation system, making it the world's first initiative of

MASS (Maritime Autonomous Surface Ships) represent the latest advancements
data, and other digital innovations to optimize route planning and navigation.

By introducing MASS, we can significantly reduce travel time, save fuel, and mitigate human errors that contribute to accidents. As pioneers in MASS technology development, we view it as a key driver for growth and strive to enhance

the stability and efficiency of our shipping services. In October 2020, Pan Ocean
and POS SM were selected by the Ministry of Oceans and Fisheries and the Min-

istry of Trade, Industry and Energy for a MASS project. In September 2022, bothparties signed an agreement to facilitate offshore demonstrations, focusing on

developing core MASS technologies and conducting phased demonstrations toestablish a foundation for commercialization.

The signing ceremony coincided with the opening of our Fleet Operation
e-Center, a cutting-edge facility providing real-time insights into vessel loca-

In March 2023, Pan Ocean signed a memorandum of understanding for a verification project to assess the effectiveits kind. This project, involving a total of five companies including Pan Ocean, POS SM, the Korean Register, HD Korea

Shipbuilding & Offshore Engineering, and Avikus, holds significant importance as it is the world's first verification of
the fuel-saving effect of autonomous navigation systems on actual ships rather than simulation. The HiNAS 2.0 autonomous navigation system, which will be utilized in this verification, has undergone safety and suitability validations,

including classification rule and regulatory reviews, and received conceptual approval from Korean Register in January 2023. By leveraging AIbased optimal route planning and automatic control functions for speed, it is expected todeliver substantial fuel savings.

Pan Ocean and POS SM will provide crucial actual ship operational data that will serve as the cornerstone of verifica-tion reliability, and they will be responsible for reviewing the feasibility of the validation process. Furthermore, we willcontinue to make sustained efforts to lead significant changes in fuel-saving aspects through autonomous navigation
technology.

tions, fuel consumption, cargo loading, and support for enhancing operational

efficiency and stability. Through advanced features such as pre-screening risk
factors and remote inspections, the e-Center empowers us to improve ship efficiency. Additionally, we plan to leverage the vast amount of big data collected by

the center to further optimize vessel performance and showcase the capabilities
of MASS technology.

We have plans to install an autonomous navigation system on an operational
container ship in 2024 to showcase its effectiveness and validity. Pan Ocean's

MASS technology is classified as Level 3, which is a high level in the International Maritime Organization's four-level autonomous navigation system classifi-

cation. Level 3 ships can be controlled remotely without onboard operators,

highlighting the advanced nature of Pan Ocean's MASS technology compared
to competitors. Our commitment extends beyond this achievement, as we willcontinue to develop environmentally friendly digital shipping technologies and2023 PAN OCEAN ESG REPORT

make necessary preparations for the successful deployment of this technology.

MOU Signing Ceremony for MASS Fuel and GHG Reduction Research

34
OVERVIEWESG IMPACTENVIRONMENTAL
Establishment ofEnvironmental
Management System
Environmental
Impact Management
Investment inGreen Vessels

Greenhouse Gas andEnergy Management
Climate Change Response

SOCIAL

GOVERNANCE
APPENDIX

Investment in Green Vessels
Establishment of Foundation for Green Vessels
Expansion of Investment in Eco-friendly Devices

We have identified various eco-friendly facilities through the Ship Energy Efficiency Management Plan (SEEMP) for standard ships

and analyzed their effects. Based on these analysis results, the company is actively investing in equipment such as hull resistance
reduction, propulsion efficiency improvement, and engine efficiency enhancement.

Specifically, we have incorporated hull designs in 15 new vessels to minimize water resistance and utilized low-friction coatings toachieve fuel efficiency. We have also installed various devices to enhance energy efficiency, such as high-efficiency LED lighting.We

plan to gradually increase investment in green facilities to actively respond to heightened environmental regulations and contributeto vessel energy efficiency improvement and GHG reductions.

Investment Status andPlans for Environmental Devices
Category

2021

BWMS

17,32523,814

AMP

569

573

66,50324,387

Scrubber

EPL

Total

48,51891--2022 2023 Target

25,989---25,989

6,860
2,587
-

2,068

11,515

Research on Green Smart Bulk CarriersParticipation in National Environmental Projects

derstanding for the research of next-generation green smart

uting to the development of the EEOI*/EEDI** system, opti-

In October 2021, Pan Ocean signed a memorandum of un-

We are engaged in numerous government projects, contrib-

bulk carriers. This agreement was of significant importance as

mizing hull management for improved efficiency, and imple-

the world's first private-led cooperative framework involving

menting measures for vessel fuel efficiency management. By

all stakeholders in the shipping process, including shipping

acquiring and applying these technologies, we are integratingcompanies, shipbuilding companies, shippers, and the Ko-

and utilizing them within our operations. Additionally, werean Register. Our aim is to achieve a 70% reduction in GHG
emissions from vessels, and we are actively participating in a

research project to explore the use of next-generation green
fuels such as LNG, ammonia, hydrogen, methanol, and ethanol, while assessing their economic feasibility and efficiency.

have entered into an agreement with the MacNet Cluster, an‘Signing Ceremony for a Mutual Cooperation Agreement for
NextGeneration Eco-Friendly Smart Bulk Vessel Research

integrated consultative body for marine industries, to foster

industry, research, and academia collaboration through strategic seminars.

*E
 EOI: Energy Efficiency Operational Indicator, an indicator showing vessels’ energy efficiency at sea.

** E
 EDI: Energy Efficient Design Index, an indicator applicable to new vessel design and building from 2013.

2023 PAN OCEAN ESG REPORT

2020(Unit: KRW million)

35
OVERVIEWESG IMPACTENVIRONMENTAL
Establishment ofEnvironmental
Management System
Environmental
Impact Management
Investment inGreen Vessels

Greenhouse Gas andEnergy Management
Climate Change Response

Greenhouse Gas and Energy Management
Greenhouse Gas (GHG) Reduction of Vessel
IMO DCS, EU MRV Regulation Response

GHG Inventory Management

consumption and greenhouse gas emissions of international navigating vessels. Every year, data from all vessels is collected andand categorizes emission sources, enabling us to effectively

We comply with the International Maritime Organization (IMO) Data Collection System (DCS), which requires reporting the fuel oil
reported to obtain certification. Additionally, for vessels calling at EU member states for cargo operations, we follow the EU Monitor-

ing, Reporting, and Verification (MRV) regulation, reporting annual data for applicable ships and undergoing verification. To facilitate
these verifications, we have established its own IMO DCS and EU MRV reporting systems, ensuring swift and systematic responses toexpanding GHG emssions regulations in the future.

GHG emissions from vessels by year
2019

SOCIAL

GOVERNANCE
APPENDIX

Emission intensity(Unit: gCO2/ton-mile)

manage and monitor greenhouse gas (GHG) emissions. Thissystem allows us to collect real-time data on fuel oil consumption and GHG emissions, including CO2, CH4, and N2O, for each

vessel. We can then analyze and manage this data by individual vessel, vessel type, and year. Leveraging our robust infra-

structure and comprehensive data, we are well-positioned to
2020

2021

2022

6.18

proactively respond to increasingly stringent GHG regulations
that apply to the shipping industry.

GHG Emissions Verification

6.59
6.15

We have established a GHG inventory system that identifies

6.02

Since 2009, we have been voluntarily collecting and managing
greenhouse gas emissions from both land-based and maritime activities on an annual basis. We aggregate CO2 emissions

for each vessel and ensure objectivity in emission calculations
through third-party verification conducted by professional institutions every year. This verification is conducted using our

Total emissions(Unit: tCO2eq)2023 PAN OCEAN ESG REPORT

2,172,997

2,382,921

2,745,505

2,669,026

in-house analysis and aggregation system, and it is based on
the principles specified in ISO GHG Protocol and IMO guidelines. We also use the verified data for preferential tax treatments for green vessels.

36
OVERVIEWESG IMPACTENVIRONMENTAL
Establishment ofEnvironmental
Management System
Environmental
Impact Management
Investment inGreen Vessels

Greenhouse Gas andEnergy Management
Climate Change Response

SOCIAL

GOVERNANCE
APPENDIX

Greenhouse Gas and Energy Management
Energy efficiency improvement

Ship Energy Efficiency Management Plan (SEEMP)

Ballast Water Management

To achieve this, they have implemented an Energy Management System (EnMS) based on the PDCA (Plan-Do-Check-Act) method.

efficiency. Efforts are made to reduce fuel consumption and

Pan Ocean's vessels are actively raising awareness about energy-related issues and continuously advancing energy-saving efforts.
The EnMS is being operated, and to maintain a continuous focus on energy matters, an energy policy has been posted on all vessels.
In particular, each vessel is equipped with the Ship Energy Efficiency Management Plan (SEEMP), and dedicated personnel are assigned for various tasks to ensure ongoing efforts for increased energy efficiency on the vessels. The SEEMP includes identification offactors related to ship energy efficiency management, such as ballast water management and hull resistance reduction, along withan analysis of their effectiveness.

Energy Efficiency Design Index Management_EEDI/EEXIPan Ocean complies with the International Maritime Organization's (IMO) Energy Efficiency Design Index (EEDI) regulation for new

vessels constructed after 2013. They measure the energy efficiency index for these vessels and specify it in the Ship Energy Efficiency

Management Plan (SEEMP) for each ship. Furthermore, to comply with the Energy Efficiency Existing Ship Index (EEXI) regulation,
which will be effective from 2023, we have established an in-house system for calculating and aggregating the EEXI for each vessel.
Based on this data, starting from 2023, we are progressively implementing Engine Power Limitation (EPL) measures on the vessels.

Vessel Energy Efficiency Index Management_CII

To manage the vessels’ energy efficiency, including both inherent energy efficiency and energy efficiency during operation, we haveestablished a system for analyzing and aggregating the Carbon Intensity Indicator (CII) for each vessel. This system allows them tosimulate the CII reference values and rating changes for all their vessels until 2030.

Based on this data, we aim to respond flexibly and promptly to the Carbon Intensity Indicator (CII) regulation by the International
Maritime Organization (IMO), which will come into effect from 2023.

2023 PAN OCEAN ESG REPORT

We support individual vessels’ trim optimization for energy
keep the vessel operating with the best possible efficiency.

Hull Resistance Reduction

To reduce hull frictional resistance that is the biggest obstacle

to vessel operation efficiency, we apply antifouling paints tominimize the impact of hull fouling. We also conduct hull examinations and performance analysis on a regular basis toconstantly monitor vessel conditions.

37
OVERVIEWESG IMPACTENVIRONMENTAL
Establishment ofEnvironmental
Management System
Environmental
Impact Management
Investment inGreen Vessels

Greenhouse Gas andEnergy Management
Climate Change Response

SOCIAL

Climate Change Response
Governance

Board Activities and Management’s Roles

Risk Managementcompany’s response to climate change issues. The CEO reviews the environmental management system more than once a year

have material financial or strategic impact on Pan Ocean andAs the final decision maker, Pan Ocean’s CEO is an inside director and the chairperson of the Board of Directors responsible for theand set goals and action plans for climate change response. The CEO also evaluates action plans and investment plans to achieveenvironmental goals and their progress as part of overall climate change response monitoring. Established in May 2022, the ESG
Committee holds half-annual committee meetings to make decisions on and approve climate change and ESG business plans. It

also manages, supervises, evaluates, and reviews relevant activities. The committee takes charge in reviewing climate risks’ impact
on Pan Ocean’s business and the company’s response.

The Risk Management Committee deliberates and make decisions on key agenda related to climate change risks and opportunities

and monitors the outcomes and their impact. It also proactively inspects environmental regulations to identify and review all potential environmental issues.

GOVERNANCE
APPENDIX

Board of Directors
CEO2023 PAN OCEAN ESG REPORTESG Committee

ESG TF

Risk Management
Committee

Report details verification anddecision making

Business
Management Team

Maritime
Environment Team

Reporting on overall environmental issues including
climate change

To pinpoint climate change risks and opportunities that may
understand how to best manage them, we address climate

hange issues in accordance with the Risk Management Committee’s operation process. The Chief Risk Officer (CRO) chairs
quarterly regular committee meetings. The CRO has the au-thority to convene extraordinary meetings as needed depending on the urgency of the issue to ensure organized and swift
response to climate change risks.

38
OVERVIEWESG IMPACTENVIRONMENTAL
Establishment ofEnvironmental
Management System
Environmental
Impact Management
Investment inGreen Vessels

Greenhouse Gas andEnergy Management
Climate Change Response

SOCIAL

GOVERNANCE
APPENDIX

Climate Change Response
Strategy

Climate Change Risks and Opportunities

The climate change impact assessment process is procedural-

Transition risks

ized to identify key climate change issues for Pan Ocean’s val-ue chains. Through this procedure, we identify climate changerisks and opportunities, examine their likelihood and impact,
and manage them accordingly.

Connections with Business andFinancial Plans

Policy/regulation

Reputation

Changes in maritime cargo volume driven by climate change
have overarching impact on Pan Ocean’s business operations

and financial plans. In this regard, we are recouping investment by selling off lowefficiency dry-bulks and tankers andaggressively investing in LNG carriers and LNG bunkering ves-

sels. Environmental regulations also incur direct and indirect
costs.

Climate Change Scenario

We are working on the transition plan as specified in the 2030
Carbon Reduction Strategy. We will deveolp detailed plans tohave our targets validated by the SBTi and assess our targets to
be in line with the 1.5- degree scenario.

2023 PAN OCEAN ESG REPORT

Financial Implications of Climate Change Risks and Opportunities
Vessel operation suspension if failingto meet EEXI* requirements

Short-term

Risk from inclusion of shipping in EU ETS

Short-term

Low-rating in CII**

Reputational deterioration due to GHG
emissions from vessel introduction and selling

Short-term

Mid-term

Opportunity

Energyresources
Resource
efficiency
MarketAcute

Chronic

Physical risks

offshore employees and cargo safety risks
from sea temperature and sea level rising due
to global warming
Impact on vessel navigation patterns(routes, speed, fuel consumption) due tocontinued changes in marine environments(current, wave height, wind, etc.)

Short-termLong-term(Short-term: in 2 years, mid-term: in 3-5 years, and long-term: in 6-10 years)

Financial Impacts

Transition to high-efficiency, low-carbon vessels

Costs to introduce environmentally-friendly systems and technologies
for regulatory compliance

Profits generated from trading carbon reduction credits

Investment in green vessels and fuelsGreater fleet competitiveness achieved by optimized fleet
operations
Fleet reorganization toward green/high-efficiency vessels
Portfolio expansion of green vessel and fuel related
businesses

Green bonds to raise funds for green transformation

Loss from drastic value decreases of non-compliant vessels forcedout of market
Emissions trading costs

Reductions in fuel consumption through high-efficiency vessel operations
Sales from increases in demands for environmentally-friendly vessels
Decreases in sales due to delays in operations* EEXI: Energy Existing Ship Index, CO2 emission per transport work calculated by design performance of vessel.

** CII: Carbon Intensity Indicator, CO2 emission calculations per transport work (ton-nautical mile) based on fuel consumption, distance travelled, etc.

39

Climate Change Response

OVERVIEW

2050 Carbon Neutrality

ENVIRONMENTAL

pledge in 2022 and established the 2030 Carbon Reduction Strategy as a tangible action plan.

ESG IMPACT

Establishment ofEnvironmental
Management System
Environmental
Impact Management
Investment inGreen Vessels

Greenhouse Gas andEnergy Management
Climate Change Response

SOCIAL

GOVERNANCE

Pan Ocean is firmly committed to assuming a leadership role in addressing and overcoming the global challenge of climate change. In pursuit of this commitment, we declared 2050 Carbon Neutrality

Environmental
Targets

Commitments

Net Zero by 2050 as a key environmental target and Integration of Net Zerocommitment within the environmental, social, and governance (ESG)
management framework

Leading the Decarbonization of the Bulk Shipping Industry

2022

IMO Regulatory
Targets

2023

EEXI enforcement

2025

2027

2030

EEDI Phase3 enforcement

2023 PAN OCEAN ESG REPORT

2030

2030 Carbon Reduction Strategy

Total emissions reduced by 10.4%, emission intensity reduced by 15.2% compared to 2021

Introduce 18K CBM LNGBV

2027

2030

Introduce the firstzero carbon vessel* Zero carbon vessels: Vessels that can completely eliminate carbon emissions (WtW), for example methanol/ammonia-powered vessels and vessels with CCUS equipment.

2050

Total CO2 emissions reduced by 50%(compared to 2008)

Initiation of CII data construction

Introduce low-carbon fuels(Biofuel, etc)

2040

CO2 emission intensity reduced by 40%(New vessel carbon intensity reduced by 30%)

2023

Pan Ocean
Milestones

By 2050__Achieve Net Zero

ㆍAchieve Net Zero in all business areas
ㆍProvide all customers and stakeholders with Net Zero solutions

2022

Pan Ocean
Strategic Targets

ㆍReduce total emissions by 10.4% and emission intensity by 15.2% (base year: 2021)
ㆍPursue external validation by SBTi (Science Based Targets initiative) in line with the
1.5℃ target

Strategic
Targets

We are at the forefront of decarbonization efforts, leading the way towards asustainable future for the industry. We have established and are implementing
robust decarbonization policies, striving to grow together with our customers
and stakeholders while sharing the outcomes with them.

Road to Decarbonisation

APPENDIX

By 2030__Implement the 2030 Carbon Reduction Strategy

Decarbonising Pan Ocean by 2050

(compared to 2008)

2040

Introduce zero emission
vessels

2050

Achieve
2050 Net Zero

Complete disposal of carbon-emitting vessel

2050

40
OVERVIEWESG IMPACTENVIRONMENTAL
Establishment ofEnvironmental
Management System
Environmental
Impact Management
Investment inGreen Vessels

Climate Change Response
2030 Carbon Reduction Strategy

Carbon Emission Reduction Details

While the quantitative targets of the 2030 Carbon Reduction

Category

Strategy are established only in Scope 1, we address Scope 2

Total Emission

and Scope 3 emissions in our detailed action plans. We aim toverify the actual route of carbon reductions and technical development/infrastructural expansion by 2030 and develop organizational net zero strategies for all business areas by 2050.

APPENDIX’30 Target

2,458,000 tons

6.59

Target Reduction

286,000 tons

5.59

Reductions

216,000 tons

Reduction

10.5%(18.9%)

163,000 tons

Transition to zero-carbon vessels

15.2%

0.62

% Reduction

1.26

85.5%

9.6%

16.7%

3.51

* Due to the replacement of vessel with large-scale vessels, the total emissions have increased, but emissions per unit of cargo have decreased.

Carbon Reduction Pathway by 2030

10.4%

Emission intensity% Reduction(93,000 tons)

High-efficiency fleet replacement and ESD introduction*% Reduction

1.00

Total emissions

Efficiency in operation patterns

100%

Total Emissions Trend

Emission Intensity Trend② Continued reductions by selling off low-efficiency vessels and acquiring zero-carbon vessels②T emporary increase in carbon emissions due to the sale of small carbon-emitting vessels, such as Chemical vessels,in 2030①T emporary expansion demonstration due to the enlargement of large-scale vessels, including the addition of 174K
CBM LNGC 7 vessels(Unit: tCO2eq)

2,800,000②①

2,700,000
2,600,000

2,400,000①S ince 2021, continuous mitigation through efficient operation patterns, high-efficiency fleet replacement and ESD introduction, etc.
(Unit: gCO2eq/ton-mile)

6.80

①

6.40
6.00

②

5.60

2,500,000

2023 PAN OCEAN ESG REPORT

2,745,000 tons

Emission Reduction Measures

Climate Change Response

GOVERNANCE’21 Result

gCO2/ton-mile

Emission Intensity

Greenhouse Gas andEnergy Management

SOCIAL

CO2e

Unit

2021

2022

2023

2024

2025

2026

2027

2028

2029

2030

5.20

2021

2022

2023

2024

2025

2026

2027

2028

2029

2030

41
OVERVIEWESG IMPACTENVIRONMENTAL
Establishment ofEnvironmental
Management System

Climate Change Response
2030 Carbon Reduction Plans

We have identified feasible carbon reduction initiatives in each area of Scope 1, 2, and 3 emissions and are actively implementing them. We are committed to ongoing carbon reduction activities and will
explore and implement further initiatives in the future.

Scope 1

Environmental
Impact Management
Investment inGreen Vessels

Greenhouse Gas andEnergy Management

Response toshipping regulations

ㆍIMO EEXI: EPL(Engine Power Limitation) to be fitted inapproximately 50 vessels in 2022 and 2023
ㆍIMO CII: Introduce high-efficiency vessels, increasing efficiency
in operation patterns, etc.
ㆍMarket-based regulations such as EU ETS and Fuel EU
Maritime: Trials to apply low-carbon bio-fuels produced frombiomass and introduce zero-carbon vessels

Increase efficiency inoperation patterns

ㆍVessel speed reduction and cruising to maximize reductions:increases in power output of an internal combustion engine
result exponential increase in emissions
ㆍDevelop a route monitoring system that uses data for long-term
efficiency in operation patterns

Replace withhigh-efficiency fleet
and introduce
ESD equipment(2022-2026)

ㆍSell off low-efficiency vessels (26)ㆍEco-spec (hull design, PBCF, etc.) new vessel orders (24)ㆍEffective ESD equipment applications including existing vessels
like rotor sails, and air lubrication systems

Transition to
zerocarbon vessels(2027-2030)

ㆍSell off carbon-emitting vessels (10)ㆍDiscontinue ordering carbon-emitting vessels
ㆍIntroduce zero-carbon vessels (6)Climate Change Response

SOCIAL

GOVERNANCE
APPENDIX

2023 PAN OCEAN ESG REPORT

Scope 2
Exploring
Opportunities
in the Korean RE100

ㆍActively considering participation in campaigns to procure
100% renewable energy for internal power consumption
ㆍReviewing Renewable Energy Certificate (REC) purchases or
third-party Power Purchase Agreements (PPAs)

Scope 3

Reductions inemissionsfrom capital goods
such as vessels

ㆍContinue cooperating with shipyards by increasing
eco-friendly products to reduce carbon emissions during theconstruction of vessels
ㆍNegotiate with manufacturers and service providers to reducecarbon emissions from the production and transportation ofparts for the existing fleet

Reductions of fuelconsumption inchartered vessels

ㆍSelect high-efficiency vessels to reduce carbon emissions fromoperation of chartered-vessels

Reductions in waste

ㆍIncrease recycling rates and minimize the amount of waste
when treating general waste and sludge from vessels
ㆍContinue corporate-wide campaigns to minimize office waste,
for example a coffee mug giveaway campaign (2022)

OVERVIEW

SOCIALPan Ocean believes the value of respect for human rights
and diversity to be realized throughout all aspects of its

business activities. We are committed to strengthening safety

management in the work environment and investing in talentdevelopment and training, in pursuit of human-centered
management.
43

Human Rights Management

57

Safety and Health Management

45
66
67

Human Resources Management
Supply Chain Management
Social Contribution

ESG IMPACTENVIRONMENTAL

SOCIAL

GOVERNANCE

APPENDIX43
OVERVIEWESG IMPACTENVIRONMENTAL
SOCIAL

Human Rights
Management

Human Resources
Management
Safety and HealthManagement
Supply Chain
Management

Social Contribution

GOVERNANCE
APPENDIX

Human Rights Management
Human Rights Management System

We have established Human Rights Management Guidelines to enhance employees' understanding of human rights and foster a culture of respect for human rights in June 2023. These newly establishedguidelines incorporate principles from various sources, including the UN Universal Declaration of Human Rights, UN Guiding Principles on Business and Human Rights, and International Labour Organization Declaration on Fundamental Principles and Rights at Work. By implementing the Human Rights Management Guidelines, we aim to share the fundamental principles of human rights and strive
to protect the human rights of not only our employees but also all stakeholders. In addition, we have set medium to long-term goals for human rights management until 2025 and plan to continuallystrengthen the human rights management system through human rights evaluations.

Fundamental Principles of Human Rights Management
1. Prohibition of discrimination

2. C ompliance with working hours and laws relatedwith labor

3. Prohibition of forced labor

4. P rohibition of child labor and measures to protect
young workers

5. Humane treatment

Medium to long-term Targets of Human Rights Management

6. G uarantee of freedom of association andcollective bargaining

7. Ensuring a safe work environment

8. Protection of environmental rights

9. Protection of the rights of local communities
10. Protection of the rights of stakeholders

Pan Ocean actively implements human rights management among its employees and encour-ages all stakeholders, including business partners involved in our business activities, to respecthuman rights. Furthermore, we strive to promote the dissemination of human rights manage-

ment to local communities, customers, shareholders, and other stakeholders who are directly or
indirectly affected by our company's operations.

Human Rights Management and Risk Management System·Human Rights Management Principles
2023 PAN OCEAN ESG REPORT

Establish
Human Rights
Management
System·Human Rights
Department·Reporting/Remedial
Measures

Human Rights
Risk
Assessment·Audits/Inspections

Step 1(2023)

Human Rights
Management
SystemEstablishment

Scope of Human Rights Management

Establish
Human Rights
Management
Guidelines

We have established long-term targets to foster a culture that respects human rights and ensure
its widespread adoption throughout the organization.

Improvement
Measures for
Human Rights
Risks·Develop Improvement
Plans/Measures

Disclosure/Reporting of Human
RightsManagement·Disclosure of Human
Rights Management
Results

Assessment

Remedial
Measures

Step 2(2024)

Establish Human Rights Management
Guidelines and Declarations

Setting Annual Human Rights
Management Goals

Basic Human Rights Education

Convening of Human Rights
Management Committee

Set med-long term Human Rights
Management targets

Establish Human Rights Management
Committee and Designate
Responsible Organizational Unit
Set Human Rights Management
Assessment Indicators

Implementation of Human Rights
Management Training for New
Employees

Step 3 (2025)

Implementation of Human Rights
Risk-Linked Specialized Training for
Job Roles
Expanding Human Rights Management in the Supply Chain

Develop Human Rights Evaluation
and Response by Responsible

Implement Human Rights Assessment

Appoint Human Rights Management
Audit Personnel

Human Rights Management
Organizational Audit

Establish a procedure for remedial
measuresReport and share reported mattersand outcomes with management

Share with employees and implement
preventive measures

Review and Edit Human Rights
Evaluation Indicators

Reporting and responsemeasures
Report result

Organizational Structure of Human Rights Management Committee
CEO(Chairperson)

Employee relations
department

Subsidiary/shareholder
relations department

Supplier/customer
relations department

HR department
Safety/health department

44
OVERVIEW

Human Rights Management

ESG IMPACT

Human Rights Protection

SOCIAL

We conduct education to promote employees’ awareness of human rights and internalize a culture of respecting human rights. We

ENVIRONMENTAL

Human Rights
Management

Human Resources
Management
Safety and HealthManagement
Supply Chain
Management

Social Contribution

GOVERNANCE
APPENDIX

Human Rights Education

provide harassment prevention, sexual harassment prevention, and disability awareness improvement training to both onshore

employees’ Rights, Labor Rights, and Human Rights

and offshore employees. As of 2022, the training completion rate is 100%. In addition to legal human rights education, starting from

No. Topic

Ministry of Oceans and Fisheries and the Korean Ship Management Industry Association. As of the end of March 2023, 104 individuals

2

January 2023, we are also conducting offshore employees and labor rights, and human rights protection education organized by thecompleted the basic course, and 73 individuals completed the advanced course.

We provide a grievance handling system where the employers and employees can share their conflicts or concerns and receive

feedback. We also have an anonymous whistle-blowing system (Help Line) in place for not only employees, but also third parties toaccess and file reports. If a offshore employees find his/her legitimate rights infringed by, for example, working condition violations,medical treatment, overdue wage etc., he/she can rely on the onboard grievance handling system (Open Reporting). At least one

grievance/complaint handling officer is appointed by offshore employees’ voting, and at the same time an onshore committee ofsafety managers and offshore personnel officers help address their grievance.

Pan Ocean Anonymous Reporting center③ Give instructions on examining reporting details⑤ Give instructions on notifying progress/result② Deliver reporting details via social networks and email① Fill out report forms⑧ Check progress/results

ReporterPOS SM Help Line

⑦ Notify progress/results

Help Line* For issues that cannot be handled, we organize an ad hoc council for handling.

④E
 xamination andreporting⑥P rocessing and Actions
on Reported Incidents

Ethical Management
Team
Notify Processing Result

Relevant departments

Top

Management

Curriculum

1

Concept of offshore employees' Human Rights

shared curriculum3

Rights to Privacy for offshore employees
onboard

Basic/Advanced

Concept of offshore employees' Labor Rights

shared curriculum

Bystander Effect4

Grievance Handling System

Anonymous Reporting (Help Line) Process

2023 PAN OCEAN ESG REPORT

Training Programs for the Protection of offshore

shared curriculum

Discrimination against Foreign offshore
employees

5

Basic/Advanced

Protection and Obligation of Human Rights for
Female offshore employees and Trainees(in terms of OSH)

6

shared curriculum

Violence: Physical Harassment

7

shared curriculum

Bullying and Harassment: Including Verbal
Abuse

8
9

10
11
12

shared curriculumStress and Suicide: Stress Management

shared curriculum

Methods for Victims' Coping (Proper Procedures andMethods for Reporting Incidents)

Basic/Advanced

Enhancement of Gender Sensitivity

shared curriculumManaging Human Rights onboard and Reme-shared curriculum

dial Measures
Bullying
and Discrimination Cases Reported

Category

2020

2021

Offshore**

3

5

Onshore*00(Unit: cases)

2022
0
6

* Excluding reports received but found not to constitute workplace bullying.
** N umber of cases handled as discrimination or bullying in the Open Reporting and grievancehandling system

45
OVERVIEW

Human Resources Management

ESG IMPACT

Attracting and Fostering Talents

SOCIALPan Ocean develops annual recruitment strategies to streamline the process. We attract outstanding candidates through targeted

ENVIRONMENTAL

Human Rights
Management

Human Resources
Management
Safety and HealthManagement
Supply Chain
Management

Social Contribution

GOVERNANCE
APPENDIX

Talents Recruitment

channels like social media and conduct blind interviews to ensure fairness and transparency in the recruitment process. We organize

annual interviewer training to ensure that interviews are conducted fairly and effectively, focusing on developing the qualities andskills of our interviewers. For offshore employees, we prioritize stability by converting contract-based master and chief engineers into
regular positions. By providing stable employment opportunities, we aim to create a supportive and reliable work environment forour offshore employees, ensuring the smooth functioning of our business activities.

Fostering Talents in Shipping

Providing Recruiting/Job Information

Pan Ocean's Talent Profile

Innovator with creative minds

Creative thinkers ushering new changes

Practical leader to pioneer global markets

Highly engaged leaders ready to seize the global markets
Experts aiming to be the best

Talents who contribute to the organization's performanceby being industry-leading experts
Team player with an open-minded attitude

A team player with mutual respect

We take responsibility and a sense of mission in cultivating maritime professionals. As part of this commitment, we participate inannual job fairs at KOREA MARITIME & OCEAN UNIVERSITY and MOKPO NATIONAL MARITIME UNIVERSITY, where we conduct recruit-

ment presentations. During these events, we provide essential corporate information such as key financial data, business areas, fleet
status, as well as details about the recruitment process for entry-level officers and our welfare benefits. These sessions are designed
to share information and foster mutual understanding with potential candidates.

Industry-Academia Scholarship and Placement

To foster and attract exceptional ship officers, we collaborate with the nation's two maritime universities to run scholarship pro-grams. We select approximately 20 senior students and provide them with scholarships and certificates. We also allocate a specificnumber of employment quotas for graduates in our annual first officer hiring process. The scholarship recipients are given priority inthe following year's hiring process. Additionally, we offer full support for their learning and development, enabling them to excel as
senior officers. Our commitment to fostering global shipping talent that will grow with us remains unwavering.

2022 Recruitment Fair at KOREA MARITIME & OCEAN UNIVERSITY

Mentoring Programs

Pan Ocean provides senior students at maritime universities

with valuable opportunities to engage in mentor and mentee
relationships with alumni. The mentors, drawing on their prac-

tical experiences and expertise, offer guidance to the students
regarding career paths and provide a comprehensive understanding of the shipping industry. This initiative aims to foster industry-academia cooperation by creating platforms for2023 PAN OCEAN ESG REPORT

knowledge sharing and professional development.

46
OVERVIEW

Human Resources Management

ESG IMPACT

Attracting and Fostering Talents

SOCIALPan Ocean annually commissions 40 third-year students, known as cadets, from Korea Maritime and Mokpo National Maritime Universities to participate in six-month onboard training programs. Our

ENVIRONMENTAL

Human Rights
Management

Human Resources
Management
Safety and HealthManagement
Supply Chain
Management

Social Contribution

Cadetship Program

goal is to foster talented Korean offshore employees, considering them as potential future Pan Ocean maritime personnel. We prioritize creating a supportive and secure learning environment for thesecadets, providing them with exceptional education and training opportunities. Upon completion of their cadet training with Pan Ocean, the maritime university students undergo performance evaluations, and the collected data is utilized during the selection process for industry scholarships in the first semester of their fourth year and for new officer recruitment in the second semester. Additionally,
we maintain ongoing mentorship activities with our onshore staff to ensure continuous support and guidance.

Annual Cadet Training Schedule
Jan

Feb

Mar

May

Jun

First Half Cadet Training

GOVERNANCE
APPENDIX

Debriefing

2023 PAN OCEAN ESG REPORT

AprSecond Half
DemandSurveySecond Half Cadet Selection,
Preparation,
and Embarkation

Jul

Aug

Sep

Oct

Debriefing

First Half
DemandSurveyNov

Dec

First Half Cadet Selection,
Preparation, andEmbarkation

Second Half Cadet Training

47
OVERVIEW

Human Resources Management

ESG IMPACT

Employee Diversity

SOCIALWe are dedicated to promoting the values of human rights and fostering a culture that embraces diversity in all our business endeavors. With operations spanning across diverse nations around the globe,

ENVIRONMENTAL

Human Rights
Management

Human Resources
Management
Safety and HealthManagement
Supply Chain
Management

Social Contribution

GOVERNANCE
APPENDIX

Embracing Diversity and Prohibiting Discrimination

we make efforts to understand and respect different races, nationalities, and cultural differences. Our commitment extends to meticulously managing recruitment and evaluation processes to ensure
equal opportunities and prevent any form of discrimination.

Pan Ocean's Code of Ethics explicitly declares our recognition of employee diversity and the commitment to non-discrimination. Our goal is to establish a more progressive corporate culture throughequal treatment, compensation based on abilities and achievements, and to further enhance the Pan Ocean’s development.

Employee Demographics by Type
Category% Female employees

2021

2022

%

24.8

26.7

27.0

4

4

%

Offshore%

OnshoreTotal

KD Tech Co., Ltd*

Foreign internationals

2020

Total

Employment of people
People with disabilities with disabilities

VeteransUnit% employees withdisabilities

peoplepeoplepeople%peoplepeople

8.5

1.2
4
-

9.3

1.5
4
-

10.1

32
4

28

0.3

4.3

6

6

6

-

Senior Manager

2.1

0.4
-

Category

FemalePosition/Grade | Female Ratio
OnshoreManager-

Male

FemalePosition/Grade | Female Ratio
Staff

Male

FemalePosition/Grade | Female Ratio*Sheltered Workshop for People with Disabilities: When considering a 2x count for severely disabled individuals, a total of 50 employees are recognized (based on the Employment Promotion and Vocational Rehabilitation for Disabled Persons Act)

Master and Chief
Engineer
Offshore

Officer

Male

FemaleMale

FemalePosition/Grade | Female Ratio
Rating2023 PAN OCEAN ESG REPORT

Male

Male

Female

Unit

2020

2021

2022

people111412people

148

156

166

%

6.9

8.2

6.7

people3233

35

people%peoplepeople%peoplepeople

71

31.1
27

38

73

31.1
29

47

63

35.7
42

53

58.5

61.8

55.8

-

-

-

194

226

217

people

395

418

413

%

2.2

2.8

3.7

peoplepeoplepeople

9

136
-

12

127
-

16

129
-

48
OVERVIEW

Human Resources Management

ESG IMPACT

Education System

SOCIAL

Onshore employees

ENVIRONMENTAL

Human Rights
Management

Human Resources
Management
Safety and HealthManagement

Training System Based on Roles and Responsibilities
In 2022, Pan Ocean restructured its education system, shifting from a rank and job-based approach to a focus on employee lifecycle and job-centric education. Through this reform, we aim to enhance

employees' dedication and practical capabilities by emphasizing their roles and responsibilities within the organization rather than merely their job titles. Additionally, we provide specialized and differentiated training tailored to the unique characteristics of the maritime industry. Particularly, the onshore employees are equipped with a deeper understanding of maritime operations and improved
communication skills through onboard training programs.
Organizational
Adaptation Period

Supply Chain
Management

Social Contribution

GOVERNANCE
APPENDIX(Associate)

Category
Level

Job
Competency

New hire early
onboarding

New Employee Course

Manager Promotion
qualification course
OJT

Engagement & Development(Manager)Specialist(Senior Manager)

2023 PAN OCEAN ESG REPORT

GlobalBusiness Leader(Department/team heads)

Organizational Engagement Training (Staff Seminar, TDP etc.) / Smart Learning(Micro-Learning, Online Library) / Statutory training
Professional course(4 years)

Professional course(4 years)

Promotion course

Newly hired/promoted executive
coursePromotion course

Professional practice, OJT, online job training
Workplace Practicum

Overseas Dispatch

Vessel On-board training

Executive/MBA

Job Mentor

On-site training
Leadership

Leader

(Deputy heads)

Bridge Leadership Training

Foreign language training program (online / phone etc.)

Team head leadershiptraining

New organization
head leadership course

Executive workshop

Leadership/
insight reverse mentor

49
OVERVIEW

Human Resources Management

ESG IMPACT

Education System

SOCIAL

Offshore employees

ENVIRONMENTAL

Human Rights
Management

Human Resources
Management
Safety and HealthManagement

Training System Based on Roles and Responsibilities
We have a customized training system optimized for enhancing the capabilities of offshore employees. Various training programs are conducted, such as promotion-required education for prospective mas-

ter/chief engineers and chief officers to ensure smooth onboard life, training for new officers, education for the acquisition of new and second-hand vessels, and more. The training extends beyond job-specificeducation to include safety-related training such as maritime accident emergency response, personal survival techniques, health and incident prevention.Starting from 2023, we plan to fully restore in-person
training that had been transitioned to remote or reduced due to COVID-19. The focus will be on improving the quality and efficiency of education programs by reflecting the needs of the field and adapting tointernal and external environmental changes. The aim is to revamp the education system to better meet the demands of the maritime industry.

Supply Chain
Management

Social Contribution

GOVERNANCE
APPENDIX

Recruitment(4 courses)· Cadet training· New officer training·E xperienced officers/ ratings
training

Officer training(5 courses)·F amiliarization Course for Cadet· New officer training· Job-specific training

Promotion training(3 courses)·P osition-specific promotion
training

Revamp Highlights

2023 PAN OCEAN ESG REPORT

Advanced job training(22 courses)· Workshops· Position-specific job training·E mbarkation and disembarkation
task negotiations·P re-boarding Work Discussion·
Vessel takeover training·Vessel type-specific advanced
training·A dvanced Navigation Training· Vessel facility advanced training

Onboard Maritime Training and Development

New officer training

Refinement of Education Targeting (by Position/Rank and Department)

Workshops

Revamping from Theory-Centric to Participation-Oriented Discussions Focused on
Communication and Safety

Pre-boarding Work

Job training(7 course)

Expansion of Job-Specific Training and Addition of R/S and Major Requirements
Education

SHEQ System Manual
Maritime Emergency Response Training
Health and Safety Training for Disaster Prevention

Maritime Survival Training

Environmental Management Education and Pollution
Prevention
Job Training

Statutory Training

Ship Security Training

Cybersecurity Education

Ice Class Education

50
OVERVIEW

Human Resources Management

ESG IMPACT

Education System

SOCIAL

Utilizing Online Education Platform

ENVIRONMENTAL

Human Rights
Management

Human Resources
Management
Safety and HealthManagement
Supply Chain
Management

Social Contribution

GOVERNANCE
APPENDIX

Online Education

As the demand for more professional and advanced education increases, we actively utilize online platforms to enhance acces-

sibility and efficiency of education. Our online education is composed of "E-Learning," which encourages continuous learning for

Employee Satisfaction Survey Results on Online
Education
Smart Learning

all employees and supports job-related and foreign language competencies and self-development. "Smart Learning" is tailored to
executives, team leaders, and team members, providing insights to flexibly respond to rapidly changing trends. It offers concise

microlearning content in various fields such as management/economics/industry, leadership and communication, humanities/

trends, encouraging a self-directed learning culture during commute times. In addition, we conduct Zoom special lectures three tofour times a year, allowing all employees to gain insights in various fields such as economics, organizational culture, and humanities

Lecture by zoomin the era of the new normal. Furthermore, we support the implementation of education programs that are perceived as necessary

by each department and team, considering their feedback. Since 2022, we have opened an e-library, offering access to e-books,

audiobooks, academic papers, etc., contributing to self-development and enhancing employee welfare. We continuously explore
and actively support the development of capabilities by meeting the educational needs of its members.

Seagull: Online Training Program for offshore employees

We introduced the ‘Seagull’, an online training program for offshore employees, in 2021. This makes e-learning available on the web

and from personal mobile devices, hence increasing accessibility. Aside from workstations, we also equipped vessels with com-puter-based training (CBT) learning materials. CBT is used as training material for fire extinguishing, evacuation drills, and onboard
safety training.

Also, we have increased the efficiency of offshore employees education by conducting ongoing monitoring of training completion

4.15(Out of 5 points)

4.24

points(Out of 5 points)

pointsOnshore Employee Boarding Training

Pan Ocean provides onboard training for onshore employ-ees. This initiative aims not only to foster maritime expertise

but also to facilitate interaction and mutual understanding
between onshore and onboard employees, considering thephysical separation due to the nature of our business. We arecommitted to enhancing cooperation and synergy between
both groups.

status and evaluating the effectiveness of education through subject-specific tests. We ensure that the same education is provided
regardless of nationality, location, and time.

2023 PAN OCEAN ESG REPORT

Onshore Employee Onboard Training Structure and Onboard
Ship Training

51
OVERVIEW

Human Resources Management

ESG IMPACT

Education System

SOCIALWe rehire retirees as part-timers in consideration of their health

ENVIRONMENTAL

Human Rights
Management

Human Resources
Management
Safety and HealthManagement
Supply Chain
Management

Social Contribution

GOVERNANCE
APPENDIX

Rehiring Retirees

conditions and job capabilities. For retirees aged between 60

and 70, we comprehensively assess their willingness, skills,

and health checkup results to determine re-employment andtake them onboard. For those aged 65 or older, we conduct

additional exams for cardiovascular diseases to regular employee health examinations for a thorough assessment, andconsider the results in our boarding plans. By rehiring retirees,

we encourage the employment of seniors with expertise andexperience and contribute to job creation for their age group.

Retirees rehired in 2022
Category

Rehired28

MasterChief Engineer
Ratings
Total(Unit: persons)

Deck

StewardEngine

50

23
12
25

138

Kim Soon-kwon (61), Master, PAN FREEDOMI have devoted my life to being a sailor, aspiring to become a captain. My unwavering passion for my job and mydeep connection to Pan Ocean, coupled with the professional skills and expertise I have acquired through years ofexperience, have been the pillars that sustained and motivated me. As retirement loomed on the horizon, however,concerns about the career break, financial stability, and family support began to weigh heavily on my mind. It wasa bittersweet realization that I would have to bid farewell to the job and life I cherished. Then, an opportunity for re-employment surfaced, acknowledging my capabilities and skills. In good physical health and driven by determination,

I recognized the potential this offered, including a relatively higher salary compared to others of my age. Accepting theoffer, I recommitted myself to my role onboard, vowing to approach it with the same dedication and enthusiasm as

when I was a rookie. The evolving nature of onboard responsibilities, increasingly diverse and intricate, has instilled inme a greater sense of responsibility, and I wholeheartedly embrace this commitment. I continually strive to maintainmy physical fitness through regular workouts onboard, while also placing great importance on the mental well-beingof my fellow offshore employees. Through open communication and meaningful conversations, I endeavor to create

a positive and supportive atmosphere onboard. Actively participating in Pan Ocean's job continuity programs, which
encompass broader communication channels, officer workshops, and various training initiatives, empowers me tofulfill my duties and play my part as a valued member of both the organization and society. With Pan Ocean as mypartner, I am determined to forge ahead, dedicating myself to the career development of highly skilled workers fromour generation the Baby Boom Generation. Leading by example, I aspire to set the highest standards, contributing
both socially and economically to the betterment of our industry and beyond.
2023 PAN OCEAN ESG REPORT52
OVERVIEW

Human Resources Management

ESG IMPACT

A Healthy Organizational Culture

SOCIALWe have a mentoring program designed to support both entry-level employees and newly hired experienced professionals. Rec-ENVIRONMENTAL

Human Rights
Management

Human Resources
Management
Safety and HealthManagement
Supply Chain
Management

Social Contribution

GOVERNANCE
APPENDIX

Mentoring Program

Flexible Working Systemognizing the importance of assisting newcomers in adapting to the organization, the program has been expanded to encompass

working hours, flexible working hours, and staggered com-

employees at various stages of their careers. Monthly programs are organized for mentors and mentees, and to ensure effectivenessof the mentoring program, anonymous surveys are conducted at the conclusion of each mentoring cycle. These surveys gather
feedback and suggestions from both mentors and mentees, which are then taken into consideration during the planning phasefor the following year's program. The mentoring program helps facilitate communications between colleagues and build a positive
corporate culture.

Mentees

Mentors

DurationType

Graduate New Hires

Graduate new hires

Senior team member

6 months

Mentee/mentor 1:1 matching
At least 2 activities per monthmuting, taking into account employees' individual job andwork situations. We are making efforts to expand flexible work
options in order to ensure employees' autonomy in their work
schedules.

Flexible Working System in Place

Overview of Mentoring Program
Category

Pan Ocean has flexible work arrangements such as selective

New Hires (Experienced Position)

Arrangement

Details

Applicable situations

Selective
working
hours

Core time andselective work
hours

Where there are difficulties in
predicting workload peaks andextended working hours forcertain times are expected(e.g., staggered operations,long-term projects leading toirregularities in extended
working hours)

Flexibleworkinghours

Pre-defined daily work
hours depending on
fluctuations inworkload

Where workload peaks are
predictable(e.g., monthly closing,short-term projects, etc.)

Staggeredoffice hours

Flexibility in attending
the office withoutchanges in daily workhours

Avoiding congestion duringrush hours, personal
circumstances, etc.

New hires (experienced positions)

Senior Manager~ Team Leader

3 months

Mentee/mentor 1:1 (or 2:2) matching

Monthly Guided Themed Activities + Recommended Additional Activities

Program<Monthly themes><Monthly themes>

2nd : Networking

2nd : Networking

1st : Mentoring W/S (Team Building and Planning)
3rd : Work-Life Balance
4th : Ritual Life

1st : Mentoring W/S (Team Building and Planning)
3rd : Collaborative Mentoring (WRAP-UP)

5th : Reverse Mentoring

6th : Collaborative Mentoring (WRAP-UP)
Reporting2023 PAN OCEAN ESG REPORT

Mentees and mentors to file monthly reports (no fixed reporting templates for mentees)

53
OVERVIEW

Human Resources Management

ESG IMPACT

A Healthy Organizational Culture

SOCIALPan Ocean offers a comprehensive set of welfare programs designed to promote a healthy work-life balance for its employees. In

ENVIRONMENTAL

Human Rights
Management

Benefits and Welfare Programs

addition to statutory parental leaves and family care leaves, Pan Ocean provides a variety of benefits aimed at enhancing the overall
well-being and quality of life for its employees.

Human Resources
Management
Safety and HealthManagement
Supply Chain
Management

Social Contribution

GOVERNANCE
APPENDIX

Life Support
Child tuition support
Housing support
Communication fee
supportMeal support

Support for kindergarten and college tuition fees forall employees
Home loan support to help
with employees’ residential stability and welfare

Hobby/Leisure/Learning
Recreational
facilities
Club activities

Support for employees’ monthly mobile phone bills

Language learning

Lunch offered at various restaurants near the office

Fitness

Shipping-specific Welfare Programs
Family boarding

Families invited to vessels with safe shipping
service distanceFamily visit(into the ship)

Through prior applications, families visit employees
during port calls

Recreation
allowances

Support provided for individuals and group leisureactivities (books, music records, fitness equipment,etc.) per vessel

Partnerships with condominiums, hotels, etc.
for reasonable accommodation costs

Support for company club activities
such as football, baseball, ski, tennis, theaters, etc.

Support for tuitions at external language academies
of employees’ choice
Support through partnerships
with fitness centers for employees’ health

Others
Welfare card

Pre-charged welfare cards (KRW 1,000,000 –
2,500,000 depending on position) offered annually

Health examinations

Comprehensive health examinations
with optional extras added to basic examinations

Birthday voucher

Birthday vouchers worth KRW 50,000

Family events

Congratulatory/condolence money, leaves, goods/
wreaths for all employees and their spouses

Satisfaction Surveys

We conduct annual satisfaction surveys of both onshore andoffshore employees, and the results are incorporated in recommendations for improvement and the following year’s action plans. For onshore employees, we use an external agency
to carry out the satisfaction survey to ensure independence.
Survey items include the corporate vision, organizational efficiency and effectiveness, corporate culture, and human resources management. We conduct indicator specific reviewof the results to develop improvement measures and haveeach organization implement action plans. Doing so allows
us to objectively analyze requests from all fields in our organizational management and continue making improvementsfor problems, thereby ultimately better satisfying employees.
In addition, we also conduct inhouse job satisfaction surveys
twice a year. To understand offshore employees’ needs andsatisfaction, we conduct an internal customer survey of masters, chief engineers, officers and engineers. Survey items aresegregated to many different dimensions including management, communications, training, operation management,
and safety and quality management, as well as into different
levels by position, nationality, and fleet. These are intended
to identify factors that have the biggest impact on local andinternational offshore employees’ satisfaction and find room
for improvement.

Satisfaction Survey Results
Category
OnshoreOffshore

2023 PAN OCEAN ESG REPORTPOS SM

Unit

2020

2021

2022

points

64.8

68.7

70.2

pointspoints(Onshore: out of 5 points, Offshore: out of 100 points)

4.23

3.58

4.16

3.69

4.02

3.57

54
OVERVIEW

Human Resources Management

ESG IMPACT

A Healthy Organizational Culture

SOCIALAs Offshore employees spend a long time onboard, we offer them mental health programs. These programs are conducted as part

ENVIRONMENTAL

Human Rights
Management

Human Resources
Management
Safety and HealthManagement
Supply Chain
Management

Social Contribution

GOVERNANCE
APPENDIX

Mental Health Programs for Offshore employeesof pre-boarding consultation meetings and workshops and aim to teach them effective communication skills to manage stressful
situations and resolve disputes. In a survey of Offshore employees regarding their satisfaction with these programs by Korea Sea-

farer's Welfare & Employment Center, 110 out of 115 respondents, or 95.6%, answered positively to the question, “Do you find theprograms helpful?”

Topics covered by the Mental Health Programs for Offshore employees
Category

Subjects

Content and Objectives

Smart Life Onboard

2nd/3rd Officer and Engineer

Stress management, adaptability to new environment, work ethics

Smart Leaders’ Life

Master and Chief Engineer,
Chief officer and First Engineer

Right leadership types for oneself, how to understand and exercise leadershipto minimize stress onboard

Master and Chief Engineer

Understanding and finding meanings of happiness and how to apply the learnings
to real-life settings

Second workshop in 2022

Stress Management

Improvement of self-esteem
Happiness Investment

First workshop in 2023

Employee Lounge Renovation

In March 2023, Pan Ocean completed the renovation of the employee lounge to provide a space for employees to relax during work

hours. The upgraded lounge is equipped with amenities such as coffee machines and massage chairs, aiming to provide a more
comfortable environment for employees to recharge and enhance their work focus.

Newly renovated Employee Lounge
2023 PAN OCEAN ESG REPORT55
OVERVIEW

Human Resources Management

ESG IMPACT

Fair Performance Evaluation and Compensation

SOCIAL

Onshore employee evaluations consist of performance evaluations, competency evaluations,

ENVIRONMENTAL

Human Rights
Management

Human Resources
Management
Safety and HealthManagement
Supply Chain
Management

Social Contribution

GOVERNANCE
APPENDIX

Performance Management and Evaluation System

Offshore Employee Evaluation System

and multi-dimensional evaluations. Performance evaluations involve strategic indicator, growthCategory

indicator, and tasks review, while competence evaluations are designed to evaluate their common, leadership, and job competency. We have a process in place to allow subjects to havemeetings with evaluators for feedback to better understand the evaluation results and raise an

objection if needed. Multi-dimensional evaluations consist of peer and upward evaluations. The

Evaluation cycle
Evaluator

Competency assessment

Biannual

Fleet and HR manager of offshore employees

results are not disclosed and used for internal management and employee satisfaction. Offshore

Offshore Employees other than Master/Chief Engineer

other staff. Masters and chief engineers are evaluated by the ship managers for their competency

Evaluation cycle

employee evaluations are categorized into master/chief engineer evaluations and evaluations for(half-annually) and performance (annually). The evaluators look into masters’ and chiefs’ overall
leadership and provide feedback, including additional training support, if room for improvement

is found. Evaluations for other staff are conducted by two senior officers and consist of job eval-uations and character evaluations. They are evaluated for their job capabilities and adaptability

as offshore employees. In particular, in character evaluations considerations are given not only totheir work attitude but also to other factors that influence life at sea, for example ethics, drinking

habits, and diligence. Subjects are provided with full details about their weakness and strengthand given opportunities to discuss the results.

Onshore Employee Evaluation System

Since 2022, Pan Ocean has been conducting a thorough review of its personnel system. As of2023, the company is undergoing consultations to improve the evaluation system and making
efforts to establish a fair and reasonable evaluation process in alignment with the restructured
position system and roles.

2023 PAN OCEAN ESG REPORT

Master and Chief Engineer

Category
Evaluator

Regular performance evaluation

Biannual

Senior officer on board

Performance evaluation

Annualoffshore employee performance assessment

Ad hoc (at the time of disembarkation)

56
OVERVIEWESG IMPACTENVIRONMENTAL
SOCIAL

Human Rights
Management

Human Resources
Management
Safety and HealthManagement
Supply Chain
Management

Social Contribution

GOVERNANCE
APPENDIX

Human Resources Management
Improving Productivity at Work
Motivation for Employees

We provide rewards and encouragement to long-term employees (10 years/20 years/30 years) as
a gesture of celebration and appreciation. In addition, we conduct reward programs for outstanding employees and teams within the organization. Similarly, we recognize and reward long-termand exceptional performance among our offshore employees. Long-term employees receive additional benefits such as extra paid leave and long-term service allowances. When they decideto retire after a certain period, we support them with adequate rest through retirement benefits
and paid leave. Furthermore, through the recognition of retiring employees, we aim to enhancesatisfaction and appreciation for their long-term commitment. Pan Ocean continuously explores
ways to improve the efficiency of our members' work and increase organizational engagement.

Sound Labor-Management Relationship
Hosting the Labor-Management Council

We strive to establish a mutually beneficial labor-management relationship and achieve sharedgoals based on mutual trust and cooperation. In order to overcome challenges posed by market
conditions, we initiated labor-management conciliation in 2013. Since then, we have made every
effort to promote shared growth and maintain a harmonious working environment with zero labor dispute. In accordance with Article 12 of the Act on the Promotion of Employees' Participation
and Cooperation, as well as Chapter 12 of the Pan Ocean Collective Agreement, we hold quarterly
Labor-Management Council meetings to negotiate wages, discuss benefits, and develop welfare
programs. Through continuous communication, we aim to enhance employee welfare and cultivate a strong corporate culture.

2022 Pan Ocean Long-term Service Award forOnshore Employees

2022 Pan Ocean Excellence Award for
Offshore Employees

Offshore employees Union Walking Competition

We provide platforms for direct communication between labor and management, such as organ-

izing events like the Maritime Union Walking Competition. Through these initiatives, we aim tofoster a healthy symbiotic relationship and build a strong rapport between the two parties.

Vitalizing Labor-Management Communications

In the case of offshore employees, we hold regularly business briefings and group meetings for each2023 PAN OCEAN ESG REPORT

level to communicate. Also position-specific promotion training and new officers/ratings training
are actively used as communication channels. While on board, we listen to employees’ opinions
and receive proposals through regular Review Reports from masters, improvement suggestion
programs, and non-compliance reporting. Through these various communication channels, Pan
Ocean strives to listen to offshore employees’ opinions and improve Labor-Management Relations.

Offshore employees Union Walking Competition in 2023

57
OVERVIEW

Safety and Health Management

ESG IMPACT

Safety and Health Management Policy

SOCIAL

Ensuring the safety and health of our members is a corporate obligation but also a responsibility. Therefore, we recognize the safety

ENVIRONMENTAL

Human Rights
Management

Human Resources
Management

Safety and HealthManagement
Supply Chain
Management

Social Contribution

GOVERNANCE
APPENDIX

Safety and Health Management Policy

and health of employees and stakeholders as the top priority value and has declared the following Safety and Health Management
Policy to put it into practice.

Developing the Safety and Health Management System

POS SM obtained the ISO 45001 certification on ship management and safety management services to comply with international
standards on safety and health management and build an integrated safety and health system. Pan Ocean aims to be certified in

2023 and is carrying out internalization of accident prevention, damage minimization, and safety awareness by developing a safety

and health management system. We have also developed basic policies for marine safety and offshore employees’ health, for example safety and quality, environmental, health and welfare, social responsibility, cybersecurity, drug and alcohol policies, which aredisclosed as a public declaration to indicate management’s interest and our willingness for safety and health.

Health and Safety Management Organization

In compliance with the Occupational Safety and Health Act andthe Serious Accidents Punishment Act, we have established a
dedicated Safety Management Department. The position ofChief Safety & Health Officer (CSHO) has been appointed tooversee safety and health management decisions. Collaborating with the safety and quality team of POS SM, we annuallypresent safety and health plans to the Board of Directors and

ESG Committee for approval. Continuous monitoring and inspections are conducted throughout the year to ensure a safe

working environment on both land and sea. We remain com-mitted to ensuring the safe work environment of our employees
and will continue our efforts in this regard.
2023 PAN OCEAN ESG REPORT

Safety and Health Management Organizational Structure

Safety and Health Organization

Safety Management Department/TeamSupervisors

Division/department heads

1. W
 e consider employees’ and stakeholders’ lives andsafety as top priorities in our business activities.
2. W
 e establish a safety and health management system and ensure compliance with relevant laws andregulations.
3. W
 e establish safety goals and conduct education,
training and inspections in an organized manner.

4. W e continue working to prevent safety failures
preemptively and proactively.
5. W
 e strengthen shared growth systems with stakeholders such as subcontractors, service providers,and commissioned services, fulfilling our roles andresponsibilities in reducing occupational accidents
for employees and stakeholders.
6. W
 e ensure employees’ voice and engagement forsafety and accident prevention.

Chief Safety & Health Officer(CSHO)Head of Safety Management Department

Pan Ocean Safety and Health Management Policy

OSH
Committee

Health and Safety Policy and Guidelines

Safety Manager
Health Manager

Supervisors

Cargosupervisionteam/officeheads

Division/Department offices
Safety and health guards

POS SM
ISO45001 Certificate

POS SM DOC
LIBERIAPOS SM DOC
SINGAPORE

58
OVERVIEWESG IMPACTENVIRONMENTAL
SOCIAL

Human Rights
Management

Human Resources
Management

Safety and HealthManagement
Supply Chain
Management

Social Contribution

GOVERNANCE
APPENDIX

Safety and Health Management
Safety and Health Promotion System

Safety and Health Goal and Performance Management

In order to become a globally leading maritime logistics company prioritizing safety and health, we have established the safety and healthgoal of 'ZERO Serious Occupational Accidents'. By setting up the key initiatives and detailed action plans to achieve this goal, we have established a safety and health goal management system. To strengthen the safety and health accountability of the Chief Safety & Health Officer(CSHO), supervisors, and the dedicated safety management team, we have defined KPIs and achievement targets, and are managing the
progress status and future action plans in relation to the set goals.

Safety and Health KPIs
2022 KPI

TargetResultNo. of serious accidents (injuries) at sea

5% reduction

19% reduced

Revision and establishment of safety and healthmanagement regulations

4 casesNo. of serious accidents (fatalities) onshore/offshore 0 caseNo. of serious accidents (injuries) on land

Convening of the OSH committee

Completion rate of safety and health training

Development of safety and health management
plans (approved by the board of directors)
Establishment of a system for collecting employee
opinions

Number of serious accidents occurred in suppliers

Support for safety management measures
meetings (offshore)
Support for work coordination between dedicatedteams (offshore)

0 case4 sessions

100%

Approval

0 case0 case5 cases

3 sessions

100%

Approved

SystemEstablishment Complete

2023 Target

ㆍMaintenance of ZERO occurrence of serious accidents
ㆍ100% resolution rate for safety feedback from contracted workers
ㆍMaintenance of ZERO accident rate for onshore employeesㆍ5% reduction in accident rate for maritime employees compared to the previous year

6 sessions

6 sessions

Yearly target achievement plan

TargetCategory

5% reduction

No. of major
accidents eported

2 sessions

No. of serious accidents (fatalities) onshore/offshore

0

No. of serious accidents (injuries) on land0

No. of serious accidents (injuries) at sea

Revision and establishment of safety and health management
regulations
Convening of the OSH committee

4 sessions
100%

Safety and health management plan (approved by the board of directors) Approval
Number of serious accidents in contracted companies

0

Support for inter-departmental coordination (offshore)

6 sessions

Support for safety management meetings (offshore)

2023 PAN OCEAN ESG REPORTㆍZERO serious occupational accidents
ㆍ100% resolution rate for safety feedback from contracted workers
ㆍZero accident rate for onshore employeesㆍ23% reduction in average accident rate for maritime employees compared to the past 5 years

0 case1 sessionAcquisition of professional certifications to enhance expertisein dedicated teams

2 sessions
6 sessions
1 person2022
Target(Result)
0
(0)

2023
Target2024
Target2025
Target2026
Target0000Resolution rate ofsafety and healthfeedback fromcontracted workers

100%(0 case )

100%

100%

100%

100%

Onshore employee
accident rate

0%
(0%)

0%

0%

0%

0%

0.78%

0.74%

0.70%

0.67%

Offshore employee
accident rate

0.82%
(0.66%)

Onshore Employees

In 2022, we officialized regular safety and health training foronshore employees (including supervisors) pursuant to theprovisions in the Occupational Safety and Health Act. We also

conducted job training for Safety and Health Management Officer and Safety and Health Managers.

Safety and Health Goal

0 case2023 KPI

Supervision and inspection by safety managers

Safety and health medium to long-term goals
and targets for 2023

Conducting Safety and Health Training

Offshore Employees

Safety management is included as a topic in workshops formaster and chief engineers, officers, job training for ratings,
and training for new officers. We also have a safety and healthmanager training course, and an ISO 45001 internal auditor
training course, among others.

Employee Safety Training Completion
Category

Unit

Traininghours
Training
participants

people

-

-

hours

9,260

Onshore Employee

hours

Offshore Employee

Traininghours
Training
participants

people

2020
-

794

2021

2022

-

4,694

17,11019,772

1,339

376

2,227

Offshore employees are not subject to statutory training under the Occupational Safety and
Health Act. Training time and trainees decreased in 2020 due to COVID-19.

59
OVERVIEW

Safety and Health Management

ESG IMPACT

Safety and Health Program

SOCIAL

Onshore Employees

ENVIRONMENTAL

Human Rights
Management

Human Resources
Management

Safety and HealthManagement
Supply Chain
Management

Social Contribution

GOVERNANCE
APPENDIX

Accident Prevention and Health Management Program
Health service room

ㆍFirst aids, self-testing kits, health consultation
ㆍHigh-risk group management including those with symptoms and those
who need attention
ㆍAutomatic blood pressure and glucose meter
ㆍGoods and equipment for musculoskeletal disease prevention
Health examinations

ㆍAnnual health examinations conducted and results retained for five years
pursuant to Article 129 of the Occupational Safety and Health Act

Brain/cardiovascular disease prevention

ㆍBrain/cardiovascular disease risk assessment, plans to offer smoking
cessation and responsible drinking programs in cooperation with publichealth centers
CPR & AED operations and training

ㆍMonthly self-inspections and reporting to the public health center, two firstaid training sessions for employees

Safety management notice board

ㆍFor all employees and supplier employees
OSH Committee

ㆍMeetings held at least quarterly

2023 PAN OCEAN ESG REPORT

Building fire and disaster response

ㆍBuilding management’s safety and health policy incorporated in the safety
and health plans and disaster prevention and damage alleviation plans
Stretching posters and safety and health signs

ㆍStretching in offices encouraged for health management in daily livesㆍWarning signs for dangerous places/substances

Security cameras in offices and emergency stairs

ㆍCameras installed in emergency stairs found as disaster-prone blind spots
Outsourcing and Operation of Counseling Services

ㆍWork stress prevention for employees’ mental health
Mental health care
ㆍWork stress assessment and psychological counseling programs
Accident Prevention Incentive System

ㆍRewards for safety accident prevention goal setting and achievements
Employee Feedback System

ㆍSuppliers: Customer service on the website

ㆍEmployees: Safety management notice board on the intranet

Employee Mental Health Education

In March 2023, POS SM conducted workplace mental healtheducation for all employees. This education aimed to preventand manage potential difficulties related to mental health,such as stress and depression, by collaborating with the Busan Jung-gu Mental Health Welfare Center. We invited mental

health social workers to provide education on preventing andmanaging job-related stress for our employees.

During the training, we analyzed external and internal factors
contributing to job-related stress and explored physiological,
psychological, and behavioral reactions to stress based on

different situations. The session also covered techniques forcoping with stress, emphasizing lifestyle improvements that

do not require excessive cost or lead to secondary issues like
addiction. Topics included sufficient stretching in daily life,
essential fatty acid intake through Omega-3, breath control tomanage emotions, exposure to sunlight, and techniques for
improving sleep quality.

POS SM recognizes the importance of stress management

within the workplace and aims to create a healthy work envi-

ronment for its employees through regular implementation ofsuch education programs.

60
OVERVIEW

Safety and Health Management

ESG IMPACT

Safety and Health Program

SOCIAL

Program Offshore employees

ENVIRONMENTAL

Human Rights
Management

Human Resources
Management

Safety and HealthManagement
Supply Chain
Management

Social Contribution

GOVERNANCE
APPENDIX

Accident Prevention and Health Management
Maritime emergency medical center

ㆍConnections to the 119 medical center and remote consultation foroffshore employees
Health examinations

ㆍAnnual health examinations pursuant to Article 53 of the Enforcement
Rules of the Seafarers’ Act
Psychological counselling for offshore employees

ㆍOrganizational Culture Improvement and Counseling for Mental HealthOnboardResilience activities

ㆍConducting various group activities among offshore employees topromote communication, empathy, and the development of problemsolving kills through brain exercises, thereby enhancing their ability tocope with stress and daily life issues
Fitness facilities in vessels

ㆍEncouraging offshore employees’ physical training and healthOperation of Safety Management Countermeasure Meetings

ㆍConducted at least twice a year

Safety and health response for individual vessels

ㆍOffshore employees’ and vessel managers’ safety and health policies
incorporated in safety and health plans and manuals
offshore employees employees and Vessel Manager Guidance Inspection

ㆍConducted at least twice a year
PPE supply

2023 PAN OCEAN ESG REPORTㆍEssential PPE including a safety helmet, safety shoes, work clothes, andwinter jackets

Onshore Safety and Quality Meeting

The onshore safety and quality meeting is organized by POS SM’s safety and quality team with the aim to review and identify im-

perfections in the results of onshore safety activities and the appropriateness of business activities and procedures. Key agenda
considered at the meeting include accident statistics, safety management system monitoring (quarterly), and amendments to man-uals, held in the form of discussions over safety and quality issues. To facilitate communications between onshore employees andoffshore employees, we started asking masters and chief engineers off-duty to attend pre-boarding consultation meetings from2021. Listening to the voices from the field at first hand helps us promote exchange of opinions.

OSH Committee

The Pan Ocean OSH(Occupational Safety and Health) Committee holds quarterly meetings to facilitate safety and health management. The committee is chaired by the CSHO and has five employee members and five employer members. Its roles include deliberating and making decisions on key matters concerning safety and health such as revising safety and health management rules,

developing safety and health plans, conducting safety and health training for employees, health examinations, serious accident
investigations, and recurrence prevention plans, etc.

Joint Land and Maritime Emergency Response Training Conducted

Under the supervision of Pan Ocean's Safety Management Department, POS SM conducted joint onshore and offshore emergency
response drills in February and April 2023. These drills involved virtual maritime accidents scenarios to indirectly experience theemergency response and handling process of both ship and onshore accident response teams. The main purpose of these joint
drills was to enhance the emergency response and handling capabilities of onshore and offshore personnel, thereby preventing the
spread of accidents and minimizing damage in case of actual incidents.

In the event of a ship emergency, the onshore departments also activated their Accident Response Task Force, including the Accident Response Chief, Technical Support Team, Business Support Team, Labor Strategy Team, and External Technical Support Team,based on the Emergency Response Training and Insurance Manual. The entire training process was closely monitored, and the comprehensive evaluation of accident handling was carried out to identify any areas that required improvement. The insights gained
from the drills, considering various possible scenarios, will be continually applied and incorporated into future training sessions.

61
OVERVIEW

Safety and Health Management

ESG IMPACT

Onboard Safety and Health Management

SOCIALWe pursue to establish a robust safety culture by preparing

ENVIRONMENTAL

Human Rights
Management

Human Resources
Management

Safety and HealthManagement
Supply Chain
Management

Social Contribution

GOVERNANCE
APPENDIX

Onboard Safety and Health Management System

Operating the Safe Work Permit Systemand sharing safety and health manuals. Onboard Safety andrelevant safety instructions prior to the commencement of the

Identifying Hazardous/
Permitted Work

must be applied to hazardous works conducted in enclosed

Risk Assessment

piping and pressure vessels, or handling asbestos, other

Hot Work

Health environment Committee meetings are held regularly,
and safety management countermeasure meetings are heldin the head office to discuss vessel safety and health issues

and to develop and implement accident recurrence prevention measures.

ChangeManagement
SystemWork
PermitSystemZero
Accident
Campaigns

giene onboard

ㆍOnboard pest management and AGM

ㆍOnboard smoking regulations and quit-smoking
ㆍOnboard noise and vibration measurements andㆍSeafarer mental health management
2023 PAN OCEAN ESG REPORT

non-regular works, and works designated by the master or theand the assessment results and work permit must be posted

ㆍCleaning, space organization, and personal hy-

management

space, works using heat sources, electrical works, works on

permit system, advance risk assessments must be conducted,

Onboard Health Management System

campaigns

work, thereby eliminating potential risk factors. The systemonboard safety manager. For all works subject to the safe work

Onboard Safety Management System
Risk
Management
SystemThe safe work permit system aims to clarify work details andOperating Process of the Safe Work Permit System

NO

YES

Hot Work Permit Application

at the work site. All those involved must attend an onboard

Work Application Review
and Hazard Assessment
Approval

Safety and Health environment Committee meeting prior tothe commencement of the work.

Offshore employees Fall Protection Device (Safety Block)Issue Work Permit

allows for controlled descent speed in the event of a fall ac-

TBM *already been installed on five vessels, and we are planning toHazard Elimination andReduction/Safety Measures

The Safety Block, in contrast to the conventional lanyard,cident, minimizing the impact and preventing injuries. It has

evaluate its effectiveness before proceeding with the installation on all ships.

Behavior Based Safety

Behavior-Based Safety (BBS) is an activity that encourages

anyone to pay attention to and intervene when hazardous behaviors are observed. POS SM is continuously striving to theidentification and correction of unsafe behaviors and conditions through BBS.

Work Execution
Monitoring and Actions forCompliance
Work Completion* TBM: Tool Box Meeting

62
OVERVIEW

Safety and Health Management

ESG IMPACT

Onboard Safety and Health Management

SOCIALPan Ocean is promoting a zero-accident campaign (POS-4P) to foster a safety culture on board

ENVIRONMENTAL

Human Rights
Management

Human Resources
Management

Safety and HealthManagement
Supply Chain
Management

Social Contribution

GOVERNANCE
APPENDIX

Zero Accident Campaign (POS-4P)

Risk Assessment and Management

and cultivate a sensitivity to risks. This campaign was introduced in accordance with the decla-

hazards present in all operational processes within the ship. Both offshore employees and repair

ration of a company-wide Total Quality Control (TQC) movement on July 1, 1992, with the aimof achieving accident-free operations for ships and maritime personnel. Additionally, rewards

are presented to accident-free vessels every 600 and 4,200 days. The Pan VIVA and Pan JASMINE

vessels achieved 4,200 accident-free days in April and June 2022, respectively, while the SUPERINFINITY vessel achieved 4,800 accident-free days, following the accomplishment of the SUPER
HERO vessel.

2023 PAN OCEAN ESG REPORT

personnel perform risk assessments for all routine and non-routine tasks. The results of theseassessments are incorporated into existing risk assessment documents or used to create new risk

assessment reports. This approach aims to prevent accidents related to ships and personnel andminimize the likelihood of incidents occurring. In particular, when significant risks are identified,
we establish and implement response measures to ensure that the tasks are carried out only after

the risks have been mitigated. In October 2022, POS SM conducted risk assessment and accident
analysis training for personnel involved in accident investigation. The training aimed to enhancetheir understanding of Risk Management, methods of risk assessment (such as HAZOP, What-If,

Zero Accident Campaign details

Fault Tree Analysis, Event Analysis, etc.), accident investigation, root cause analysis, and the process of implementing corrective actions and preparing accident investigation reports. This train-

Tool Box Meeting(TBM)

Daily Safety Duty System Operation

Be aware of and confirm detailed work
instructions, safety attire, and health condition
before commencing or resuming work.

Inspections for potential risk factors
and daily safety logs

Safety Instruction Cards

Pointing and Confirmation

Safety instruction cards posted in designatedareas before work to promote awareness andremind individuals about safety precautions
related to the specific tasks

Clearly pointing at and calling out
objects to prevent involuntary humanerrorsPosting and Utilization of Incident Cases

Risk Awareness Training

Sharing key cases from the distributed
incident casebook on the bulletin board
and incorporating them into training
sessions.

We conduct risk assessments to proactively identify and effectively eliminate or mitigate potential

Monthly drills for task groups toimprove risk sensitivity and risk
identification skills

ing was not only provided to maritime personnel but also extended to onshore staff responsible

for managing them. We plan to continue conducting regular training sessions to further improve
the job capabilities of both maritime and onshore employees in the area of Risk Management.

Publication of POS VIEWPOS VIEW is a quarterly newsletter distributed to vessels, containing details on key business issues, safety management activities, health, diseases, etc. It serves as a communication platformthat connects onshore and offshore personnel, encompassing significant news related to thevessels, lessons from accidents, conflict resolution between generations, and mental care information. Notably, we share a list of vessels that have achieved accident-free performance through

POS VIEW to spread a safety-conscious atmosphere throughout the ship. We also receive reports
on near-miss and inappropriate incidents and reward outstanding practices. Recipients of theseawards receive certificates and cash prizes from the ship's Safety and health environment committee, and these achievements are featured in POS VIEW. In this manner, Pan Ocean is committed to promoting a strong safety culture within the ships through various activities and emphasizing safety as our top priority across all vessels.

63
OVERVIEW

Safety and Health Management

ESG IMPACT

Onboard Safety and Health Management

SOCIALAll work must be immediately suspended whenever a condition or behavior that has grave influence on people, facilities, or environ-

ENVIRONMENTAL

Human Rights
Management

Human Resources
Management

Safety and HealthManagement
Supply Chain
Management

Social Contribution

GOVERNANCE
APPENDIXWork Stoppage Procedure

Work Stoppage Policy

ment is found. All offshore employees and suppliers’ personnel working onboard have the responsibility and authority to prevent

safety training for new recruits as well as quarterly safety train-

imminent risks and hazardous situations. No activities take precedence over their safety and health. All personnel at Pan Ocean havethe right and obligation not to perform duties and activities that may cause serious risks. We ensure that the Lockout-Tagout procedure be practiced and workers freely exercise their authority to cease works whenever they perceive risks.

ing for onboard offshore employees. Discussions related to
the Stop Work Policy are conducted during the monthly vessel
SHEQ meetings.

Management of Critical Tasks and Safety Poster Production.

We designate high-risk tasks such as confined space work, hot work, scaffolding and rigging operations, electrical work, and equipment handling as Critical Tasks. To ensure continuous awareness of

key points, we display Safety Posters in designated areas. This encourages a constant understand-ing of essential aspects. Before starting any task or in case of issues, individuals can verify the key
points to enable practical checks and, if necessary, facilitate work suspension. We also promote thedissemination of work stoppage policies and foster proactive safety management and leadership.

ePOS Computer System

POS SM has implemented the ePOS Computer System to enable real-time sharing of safety management activities, including risk
assessment and near-miss reporting, across onshore and offshore operations. This system facilitates concurrent safety management at both field and company levels, while ensuring systematic data management through computerization. Key informationand guidelines are communicated through the Letter of Company (LOC), and the follow-up function is utilized to monitor and ensurecompliance with onboard instructions. Additionally, the system allows for efficient management of vessel maintenance history andfacilitates requests for onshore support and necessary actions.

2023 PAN OCEAN ESG REPORTPOS SM holds a Work Stoppage Policy and shares it through

POS SMWork Stoppage Policy

Lockout-Tagout

Overview of Vessel & Offshore Employee Management System

POS SM implements a Ship Crew Management System as partof its integrated ship management approach, facilitating effi-

cient support between onshore and onboard operations. Thissystem enables seamless online integration, mitigating potential risks arising from physical distance and enabling prompt

task management through effective communication. Additionally, POS SM has established a comprehensive ship equipment
and supplies database, enhancing the reliability of information.
Vessel Management

offshore employee
Management

Procurement
Management

SHEQ

OPEX

Main Ship System

64
OVERVIEW

Safety and Health Management

ESG IMPACT

Emergency Response System

SOCIALIn case of ship or personnel accidents, we have established an Accident Response Committee to perform the role of an accident control tower. Under this committee, an Accident Response Team consisting

ENVIRONMENTAL

Human Rights
Management

Human Resources
Management

Safety and HealthManagement
Supply Chain
Management

Social Contribution

GOVERNANCE

Emergency Response Structure and Procedureof team leaders from related departments and vessel managers is formed to maintain close communication with the main vessel and handle actual accident response tasks. In addition, we are operating
the BCP (Business Continuity Plan) Manual and Emergency Response Manual for Maritime Accidents to ensure swift response and efficient management of accident records.Following these manuals, we

activate an immediate and smooth emergency response system in case of emergency situations to minimize damages. In the event of a patient incident or ship accident, we implement emergency measures
promptly and conduct post-accident analysis in detail to establish measures for prevention. Through these efforts, we aim to prevent similar accidents, reduce accident risks, and improve safety measures.

Emergency Response Organization

Vessel Accident Emergency Response Process

Accident Response Committee

APPENDIX

Accident

Accident Response Team
Planning Team

Maritime
Coordination
Team

MarineInsuranceTeam

Safety Management
Team

Responsible
Operations
Team

VesselManager
Emergency
Response
Team
Vessel2023 PAN OCEAN ESG REPORT

Activation andReporting of
OnboardEmergency
Response
Organization

Initial Response
and Notification
to Relevant
Authorities

Detailed
Assessmentof the Accident
andConsiderationof Repair
Solutions

Confirmationof Repair
Solutionsand Implementationof Repairs

Analysis of
Accident
Causes and
Implementationof Preventive
Measures

Notification
to Relevant
Authorities
and Decision
on Disembarkation

Decision on
Disembarkation
Location and
Subsequent
Procedures

Analysis of
Accident
Causes and
Implementation ofPreventive
Measures

Personnel Accident Emergency Response Process

Accident

First-Aid
Onboard(Consult a land
emergency
medical center if
needed)Accident Reportand Initial
Notification

65
OVERVIEW

Safety and Health Management

ESG IMPACT

Emergency Response System

SOCIALPOS SM operates a Business Continuity Management System

ENVIRONMENTAL

Human Rights
Management

Human Resources
Management

Safety and HealthManagement
Supply Chain
Management

Social Contribution

GOVERNANCE

ISO 22301

to effectively manage business continuity in the event of un-

expected crises such as disasters, emergencies, terrorism,
and infectious diseases. The system aims to minimize work
disruptions and ensure the prompt recovery of key business

functions. Mitigation measures have been established basedon comprehensive Business Continuity Plans for onshore andvessel operations. In 2022, operational targets were set for

Infectious Disease Response System

POS SM identifies risks that may occur in both onshore and offshore environments and selects significant risks to establish corresponding Business Continuity Management plans. For instance, regarding the risk of infectious diseases, which falls under the

category of major onshore disasters, an infectious disease response system has been developed. This system involves analyzing

the current status, outbreak areas, and trends of emerging infectious diseases, as well as the geographical characteristics of theaffected regions. It also includes mitigation measures, specific action plans, and response protocols to address the potential
impacts on key processes.

both onshore and vessel operations, and a 100% performance

Outcome of Infectious Disease Risk

ㆍRapid spread of the infectious disease leading to multiple casualties.

nual disaster training have been conducted to enhance pre-Impact on Key Processes

ㆍPersonnel Management: Disruption of operations due to essential staff shortages andinsufficient manpower.
ㆍResource Management: Closure of office facilities to prevent the spread of infectious diseases.

RTO(Recovery Time Objective)ㆍ2 Daysrate was achieved. Quarterly joint land-sea exercises and anparedness and response capabilities.

APPENDIX* RTO(Recovery Time Objective) : The targeted time for recovering the information system after a disaster occurs

ㆍEnhancing work capacity and developing backup personnel through rotating shifts

Prevention/Preparation

Mitigation
MeasuresResponsible Department

Joint land-sea exercises and annual disaster drills

and backups

ㆍIdentifying activities within the organization that can be outsourced or relocatedㆍImplementing IT infrastructure to enable remote work options
ㆍLeasing business center offices and IT equipment

Response/Recovery

2023 PAN OCEAN ESG REPORTㆍIdentifying critical job positions and conducting cross-training for designated substitutes

ㆍPrioritizing essential tasks in resource reallocation from support functions

ㆍAssigning frontline employees such as retirees or internal auditors to handle routine tasks
ㆍPOS SM Management Team Control

66
OVERVIEWESG IMPACTENVIRONMENTAL
SOCIAL

Human Rights
Management

Human Resources
Management
Safety and HealthManagement
Supply Chain
Management

Social Contribution

GOVERNANCE
APPENDIX

Supply Chain Management
Supplier Management

We recognize that transparent and stable supply network management is essential for sustainable growth. We categorize and manage suppliers into shipping agents, tug services, materials suppliers, and lashing services. We define core suppliers based on theirmarket share, price competitiveness, financial soundness, and other factors. As of 2022, Pan Ocean has 46 core partners.

POS SM encourages suppliers to comply with Pan Ocean's environmental and ethical management rules and policies. They are
asked to familiarize themselves with SHEQ through meetings and sign a written confirmation prior to commencing work onboard.

Supplier Selection and Evaluation

For supplier selection and evaluation, we employ both quan-titative and qualitative methods. In order to enhance sustainable management in our supply chain, we strive to incorporate

both financial and non-financial aspects in these evaluations.

We consider safety and health compliance as significant factors in supplier assessments, alongside sales, credit ratings,

Category

Navigation cost
Bunker cost

Vessel Maintenance costCore suppliers
Regular suppliersCore suppliers
Regular suppliersCore suppliers
Regular suppliers

Certified Excellent Shipping Company and Shipper

The Ministry of Oceans and Fisheries introduced the Certified Excellent Shipping Company andShipper scheme to eradicate unfair trade practices between shipping companies and shippers
and facilitate shared growth between them by establishing mutually beneficial and cooperative

relationships. In recognition for our fair and stable shipping service quality and willingness topursue shared growth with shippers, we obtained the Excellent Shipping Company certification.

and other indicators of financial stability.

POS SM has established its own criteria for supplier selection,and selected suppliers are invited to participate in tenders

through the company's IT system. Suppliers engaged in trad-

ing with the company undergo periodic evaluations, conducted at least twice a year, which inform adjustments in tradevolume and may prompt necessary warnings.

To foster sustainability management among our suppliers, weare planning to develop measures that assist them in meetinginternational standards and regulations related to environmental practices, safety, human rights, and ethics. Addition-

ally, we aim to introduce incentives to encourage their active
2023 PAN OCEAN ESG REPORTSuppliers

involvement and support in environmental management.

Excellent Ship Management Operator Certification

The Excellent Ship Management Operator Certification System is designed to enhance the management capabilities of ship management operators and promote the development of the ship

management industry with growth potential. Pan Ocean has been recognized as an excellent
ship management operator, being the first in Korea to receive such recognition, based on its cor-porate competence in ship management and outstanding service quality. As a result, Pan Ocean
may be eligible for priority support in government programs aimed at exploring overseas mar-kets and establishing overseas business networks, particularly in terms of crew education andwelfare initiatives. Additionally, when foreign vessels managed by Pan Ocean enter domestic
ports, they are eligible for reduced harbor usage fees.

2020
3
199
7
19
26
400

2021
3
200
8
12
30
482

2022
3
211
8
18
35
459

67
OVERVIEWESG IMPACTENVIRONMENTAL
SOCIAL

Human Rights
Management

Human Resources
Management
Safety and HealthManagement
Supply Chain
Management

Social Contribution

GOVERNANCE
APPENDIX

Social Contribution
Social Contribution Strategy System

To achieve our corporate vision of being a "Global Leading Shipping and Logistics Company," Pan Ocean has established a mission of"Creating Value in Life and Sharing Happiness." In April 2023, while solidifying our corporate social contribution strategy, Pan Ocean

has prioritized "Community Coexistence" as the primary goal for 2023. Through benchmarking our social contributions with othercompanies and evaluating our current social contributions, we have identified volunteer activities and donation initiatives as specif-

VisionGlobal Leading Shipping & Logistics Company

ic action plans to expand our commitment to social responsibility and contribute to the local community. Going forward, Pan Ocean
will continue its efforts to create social value through diverse social contribution activities.

ProgramType

Eco Clean Volunteer
GroupsVolunteer Work

Flower tributes at theSeoul National
CemeterySocial Contribution
Mileage System

MissionValue Creation of the Life & Sharing Happiness2023 Social Contribution Goals

Seoul Senior Welfare
Center2023 PAN OCEAN ESG REPORT

Social Contribution Strategy

Implementation

Fulfilling its corporate social responsibility
Contributing to the community

Details

2022 Result

2023 Target

2024 Target

2025 Target

Eco Clean Volunteer Groups
Activities

4 sessions

24 sessions

24 sessions

24 sessions

Employee participation-

4+ sessions

4+ sessions

4+ sessions

Volunteer Work

Floral Arrangement andEnvironmental Cleanup
Activities

once

2+ sessions

2+ sessions

2+ sessions

Promoting Employee Social Contribution Activities

Volunteer Work

Meal Distribution Activities

02+ sessions

2+ sessions

2+ sessions

Donation

Donation of Special Meal
Ingredients

bution activities, we have established and are operating the "Social

Twice

Twice

Twice

Twice

Volunteer Work

Annual Volunteering Hours
per Person

02+ hours

2+ hours

2+ hours-

New execution

Execution

Execution

Donation

Cumulative Mileage-based
Donationsto Public Organizations

Industry-Academic
Scholarship for Students

Donation

Scholarships for Students
from KMOU / MMU

15 people

20 people

20 people

20 people

Donation to Marine
Security Institutions

Donation

Donation of Goods to the
Navy/Coast Guard-

New execution

Execution

Execution

Medium to long-term goal ('23-'25): Gradual expansion and advancement, such as increasing annual targets compared to the previous year's performance

Volunteer Work

Donation

To encourage voluntary participation of employees in social contriContribution Mileage Program." This program allows individuals toaccumulate mileage points for their social contribution activities,
and based on their accumulated points, they receive incentives in

the form of monetary rewards or gifts. Social contribution activities
recognized under this program include blood donation, financial

donations, environmental cleanup, talent donations, account donations, other volunteer activities(including in-house volunteer
activities), and any other forms of social contributions. Throughthe implementation of this program, we encourage all of our em-

ployees to actively engage in social contribution activities and lookforward to their meaningful contributions to society.

68
OVERVIEW

Social Contribution

ESG IMPACT

Social Contribution Strategy System

SOCIALPan Ocean is committed to continuously supporting socially vulnerable groups through ongoing initiatives, including floral tributes at the National Seoul National Cemetery and meal distribution vol-ENVIRONMENTAL

Human Rights
Management

Human Resources
Management
Safety and HealthManagement
Supply Chain
Management

Social Contribution

GOVERNANCE
APPENDIX

Social Contribution Programs

unteering at the Seoul Senior Welfare Center. Despite some limitations caused by the COVID-19 pandemic, we are determined to resume and expand our previous activities. To achieve this, we havedeveloped an annual plan for social contribution activities and established the Eco-Clean Volunteer Group. Furthermore, we will actively promote social contribution activities that are closely linked tothe characteristics of the shipping industry.

Eco Clean Volunteer Groups

Meal Distribution volunteering at the Seoul Senior Welfare Centerto establish the 'Clean Eco Volunteer Group' as part of its community contribution efforts andactivities at the Seoul Senior Welfare

In November 2022, Pan Ocean collaborated with K.D. Tech Co., Ltd,a disabled-friendly workplace,to engage with various stakeholders while creating job opportunities. The Eco Clean Volunteer

Group conducts regular activities twice a month, such as environmental clean-up activities inparks, tourist sites, and subways, sharing meals with vulnerable groups, and cleaning residences

for elderly living alone in the local community. Both disabled individuals and employees actively
participate in these social contribution activities together.

Pan Ocean conducts volunteering

Center, including meal distribution
and dishwashing services. During

major holidays such as New Year's
and Chuseok, we provide special

meals to ensure that elderly individuals have a hearty meal.

Flower tributes at the Seoul National Cemetery
Through a sisterhood agreementwith the Seoul National Cemetery,

we conduct activities such as replacing floral tributes at the cemetery's

designated areas on Memorial Day

and engaging in environmental

cleanup efforts as a tribute to the noble spirit of patriotism and devotion.
2023 PAN OCEAN ESG REPORTOVERVIEW

GOVERNANCE
A transparent and healthy corporate culture is a

steppingstone for us to thrive and earn stakeholders’ trust.
Pan Ocean pursues transparency based on due process
in governance and ethical decision making.

70

Governance76

Ethical and Compliance Management

73
80

Risk Management

Information Security

ESG IMPACTENVIRONMENTAL

SOCIAL

GOVERNANCE

APPENDIX

70
OVERVIEWESG IMPACTENVIRONMENTAL
SOCIAL

GOVERNANCE
GovernanceRisk Management

Ethical and ComplianceManagement

GovernanceCorporate Governance Charter

As part of its efforts to enhance corporate governance, Pan

As of June 2023, Pan Ocean's Board of Directors, the highest decision-making body, consists of 3 inside directors and 4 independent

Charter in February 2022. Based on this Charter, we are com-of incorporation specify that the total number of directors should be no less than 4 and no more than 9, with the majority of inde-

Ocean established and disclosed the Corporate Governancemitted to protecting the rights of all stakeholders, including

shareholders, and striving to establish and enhance a soundcorporate governance structure.

Information Security

Corporate Governance Charter Preamble

APPENDIX

resenting Korea, is committed to becoming a global

Pan Ocean Co., Ltd., a global shipping company repleading shipping logistics company by leveraging its

extensive business capabilities in the shipping sector

and revitalizing grain distribution and logistics businesses.

With the recognition that corporate governance playsa pivotal role in enhancing shareholder value, build-ing trust with various stakeholders, and safeguarding
the rights and interests of all, Pan Ocean Co., Ltd. hasestablished the Corporate Governance Charter. This
charter serves as a fundamental framework to guideour corporate governance practices and ensure trans-parency, integrity, and responsible decision-making
throughout our organization.

Corporate Governance Charter

2023 PAN OCEAN ESG REPORTBoard of Directors

directors, meeting the requirements of the Commercial Act. To ensure effective operation through checks and balances, the articles
pendent directors forming the board.

Board composition
Category

Name

GenderInside Director

Kim Hong Kuk

Male

Inside Director

Ahn Joong Ho

Male

Inside Director

Cheon Se Gi

Male

Independent
Director

Jeong Hak Soo

Independent
Director

TenureAs of 2023.06.30

Position

Professional experienceCEO

CEO of Harim Holdings Co., Ltd.

Shipping

CEO / Chairperson of BOD

CEO of Pan Ocean Co., Ltd.

2015.07.18 ~2025.03.28

Head, Ethical Management
Department

Head of Management Support TeamMale

2021.03.30 ~2024.03.30

Businessmanagement

Oh Kwang Soo

Male2019.03.27 ~2025.03.28

Law

Chairperson, Independent Director
Recommendation
Committee / Chairperson,
Remuneration Committee

Lawyer of DR & AJU Law Firm

Independent
Director

Ku Ja Eun

Female2023.03.29~
2026.03.29

Accounting

Chairperson of the Audit
Committee

Independent
Director

Kim Young Mo

Male

2023.06.16~
2026.06.16

Associate Professor, Department
of Business Administration,
Suwon University

Finance-

The Korea Development Bank(KDB)

2015.07.18 ~2025.03.28

2020.03.30 ~2026.03.29

Expertise

Businessmanagement

Agriculture/
grain

Chairperson, Internal Transactions / Chairman of the East Asia Agri.
Chairperson, ESG Committee
Association

71
OVERVIEWESG IMPACTENVIRONMENTAL
SOCIAL

GOVERNANCE
GovernanceRisk Management

Ethical and ComplianceManagement
Information Security

APPENDIX

Governance
Board Operations

Committees within the Board

Directors, as stipulated in the operating regulations, to ensure

Transactions Committee, the Remuneration Committee, and the ESG Committee. All Committees are composed of a majority of in-

The Chairperson of the Board is appointed by the Board ofstrategic and efficient board operations. The Chairperson,
who possesses a high level of expertise and understanding in

the maritime industry, plays a pivotal role. The Board of Directors holds regular meetings and convenes extraordinary meet-ings as needed. In 2022, a total of 12 board meetings were
held, discussing 52 agenda items. The overall attendance rate

for directors was 96%, with 100% attendance for inside directors and 93% for independent directors. Detailed informationon the Board's activities is disclosed in the company's annual
report and website.

Board operation rules

Board Operations
Category

Attendance, insidedirectors
Attendance, independent directors

Attendance, overall

No. of BOD meetings
No. of total agenda
discussed

No. of resolution on
key ESG issues by BOD

Unit
%

%
%

meetings
agendas
cases

2020

83
85
85
12
44
-

2021

83
86
85
14
46
-

2022

100
93
96

dependent directors to ensure independent and objective operations. The ESG Committee was voluntarily established in May 2022
to comprehensively promote and manage sustainable management practices. In the future, the committee will take a leading role inreviewing and supervising Pan Ocean's overall ESG strategy and implementation plans.

Committees within the Board
Committee
Independent Director
Recommendation
Committee(4 members)
Audit Committee(4 members)

Internal Transactions
Committee(5 members)

12
52
2

* In the previous year, it was calculated using a simple average. However, for this year's data calculation, it has been revised for all three years by calculating the ratio of attendance to the total
number of meetings.

2023 PAN OCEAN ESG REPORTPan Ocean’s board Committees include the Independent Director Recommendation Committee, the Audit Committee, the Internal

Remuneration Committee(4 members)

ESG Committee(4 members)Composition
Position

Category

Name

GenderMemberIndependent Director

Jeong Hak Soo

Male

Chair

MemberMemberChairMemberMemberMemberChairMemberMemberMemberMemberChairMemberMemberMemberChairMemberMemberMemberIndependent Director

Independent Director

Independent Director

Independent Director

Independent Director

Independent Director

Independent Director

Independent Director
Inside Director

Independent Director

Independent Director

Independent Director

Independent Director

Independent Director

Independent Director

Independent Director

Independent Director

Independent Director

Independent Director

Independent Director

Oh Kwang Soo
Ku Ja Eun

Kim Young Mo
Ku Ja Eun

Jeong Hak Soo
Oh Kwang Soo
Kim Young Mo

Jeong Hak Soo
Ahn Joong Ho

Oh Kwang Soo
Ku Ja Eun

Kim Young Mo

Oh Kwang Soo

Jeong Hak Soo
Ku Ja Eun

Kim Young Mo

Jeong Hak Soo
Oh Kwang Soo
Ku Ja Eun

Kim Young Mo

Male

FemaleMale

Female
Male

Male

Male

Male

Male

Male

Female
Male

Male

Male

Female
Male

Male

Male

FemaleMale

Board committee operation rules

Roles
To select and consider candidates for the independent
directors to be elected at the general meeting ofshareholders

To conduct audits of overall business management
including financeTo conduct preliminary reviews of large-scale internaltransactions under the Monopoly Regulation and Fair
Trade Act and internal transactions subject to board
approval under the Commercial Act
Pre-deliberations on annual remunerations for directors,
predeliberations on performance evaluations and performance pay, suggestions on the company's remuneration
system and payment
To manage, supervise, evaluate, and review strategies andkey issues related to the company’s ESG management(environmental, social, and governance)

72
OVERVIEWESG IMPACTENVIRONMENTAL
SOCIAL

GOVERNANCE
GovernanceRisk Management

Ethical and ComplianceManagement
Information Security

APPENDIX

GovernanceExpertise and Diversity of the Board

Pan Ocean's independent directors possess expertise in accounting, law, and agriculture/grain, thereby enhancing theknowledge and diversity within the Board of Directors. The Independent Director Recommendation Committee rec-ommends candidates with extensive knowledge and experience in areas such as business management, economics,
accounting, law, and relevant technologies. The committee adopts a comprehensive approach to candidate selection,
without imposing limitations based on ethnicity, nationality, gender, region, religion, or expertise.

Shareholder Value Improvement

Encouraging active execution of shareholders’ rights

We actively promote shareholder engagement and provide various channels for shareholders to exercise their rights. Since the 2019 general meet-ing of shareholders, we have adopted an electronic voting system and introduced an electronic proxy voting system to increase shareholder voting

participation. Furthermore, we notify shareholders of the general meeting

Independence of the Board

The roles and functions of independent directors are clearly defined to ensure their independent participation in ma-

jor decision-making processes and oversight of management activities. Independent directors hold a majority in the

Board of Directors, and board Committees are also primarily composed of independent directors to facilitate objectiveof shareholders and relevant agenda items four weeks in advance, ensuringthat they receive sufficient information about the meeting date, location,and proposed matters well in advance.

and independent decision-making. The Independent Director Recommendation Committee, composed entirely of

Dividend Policy and Guidelines

board deliberations, receive approval, and are appointed during the general meeting of shareholders.

year dividend guideline. Any decisions or revisions regarding the share-

independent directors, verifies candidates for independent director positions. Subsequently, the candidates undergo

Category

Inside Directors

Independent Directors
Total(unit: KRW million)

No. of people

Total compensation

Average amount per person

3

161

41

3

6

2,316

2,477

772

393

ㆍNo. of people is based on as of end of 2022.
ㆍThe total compensation includes the payments to retiring registered directors, independent directors, and audit committee members during thecurrent fiscal year

Pan Ocean has formulated a dividend policy and publicly disclosed a threeholder return policy, including dividends, will be promptly communicatedthrough timely public disclosures, providing shareholders with detailed information. We are also dedicated to raising awareness among shareholders

about our initiatives aimed at enhancing shareholder interests, including
the shareholder return policy. Pan Ocean is committed to maximizing shareholder returns to the best of its abilities.
Dividend Policy

Pan Ocean will provide cash dividend to shareholders after allocating financial results in areasonable and balanced way to secure investment resources maintaining the soundness offinancial structure.

Dividend Guideline (2021~2023)

Pan Ocean will return 10% to 20% of net profits excluding extraordinary income based on K-IFRS
Separated financial statement.
2023 PAN OCEAN ESG REPORT73
OVERVIEW

Risk Management

ESG IMPACT

Corporate Risk Management System

SOCIAL

To comprehensively address various risks associated with our business activities, we operate the

ENVIRONMENTAL
GOVERNANCE
GovernanceRisk Management

Ethical and ComplianceManagement
Information Security

Risk Management Organization

Risk Management Committee

Risk Management Committee. The committee consists of a chairperson, representatives fromCEO

each department, and a secretary, and depending on the agenda, relevant senior managers, directors, or team leaders from related specialized organizations may also participate. The committee meets on a quarterly basis, and ad hoc meetings can be convened as necessary. Its role is toChair

identify and assess risks across the company's operations, formulate key response measures, anddevelop specific action plans to proactively address potential crises faced by Pan Ocean.

APPENDIX
Sales Division Head

Planning
Department HeadSecretary(Risk Management Team)

Finance
Department HeadBusiness Coordination
Department Head

Risk Management Process

Identify risks

2023 PAN OCEAN ESG REPORT

Collect details andprepare agenda

Call Risk
Management
Committee meeting

Discuss andresolve

Report to CEO

Continuemonitoring

74
OVERVIEWESG IMPACTENVIRONMENTAL
SOCIAL

GOVERNANCE

Risk Management
Risk Types and Response Activities
Type

Account risk

GovernanceRisk Management

Ethical and ComplianceManagement
Information Security

APPENDIX

Financial risk

Legal risk

Marketcondition riskMarine/environmental risk

Others2023 PAN OCEAN ESG REPORT

TopicResponse

Customer relationshipmanagement (CRM)

ㆍStrengthen data- and system-based customer risk management

Regular credit rating

ㆍPrevent customer risks based on organized customer rating management and information sharing

Financial market
and macroeconomic

ㆍRegular monitoring of global economic and financial market trends

Internal accountingㆍCheck internal accounting operations and key issues

Receivables management

ㆍMonitor and take action on receivables

Legal Issues and disputes

ㆍSharing legal trends/key contractual issues and strengthening response mechanisms

Changes in market conditions

ㆍCheck and manage the fleet position

Oil price change

ㆍMonitor and respond to oil price fluctuations

Derivatives

ㆍManage regulations on forward freight agreements and fuel oil hedge deals

IMO environmental regulations

ㆍContinue monitoring developments surrounding the IMO environmental regulations and developing
countermeasures

Fuel oil supplyㆍCheck the fuel oil supply process

Major climate risk

ㆍMonitor and respond to major climate risks such as typhoons, hurricanes, and monsoons

Cybersecurity risk

ㆍMonitor cybersecurity risks and check the internal response system

Disclosure rules

ㆍMonitor and respond to changes in disclosure rules

Vessel operational risk

ㆍMonitoring and responding to operational risk: Country-specific port entry regulations, epidemics, andinternational political situation changes

Account Risk Management

Given the presence of ongoing risks associated with accounts,
we maintain regular checks and monitoring their status andperformance. In the event that a critical account risk is identified, we promptly respond by implementing necessary actions, such as adjusting credit ratings or blocking further commitment. This proactive approach enables us to effectively
manage and mitigate potential risks in our accounts.

Account credit-rating assessment

New accounts and existing accounts with no deals in the last

12 months are subject to assess credit based on internal credit

rating criteria. Prior to entering into contracts, credit ratings
are conducted for these accounts, which serve as the basis forestablishing credit limits for each account.
Category

No. of accounts

2020

522

2021

489

2022

481

Account credit-rating adjustment

For accounts with transaction records in the past 12 months,
regular semi-annual credit rating assessments are conducted.

The process involves an initial evaluation, followed by evaluations conducted by relevant teams and divisions, and concludes with comprehensive assessments to determine thefinal credit ratings.
CategoryNo.
of accounts

First half

Second half

2020

2021

2022

876

907

972

851

940

957

75
OVERVIEWESG IMPACTENVIRONMENTAL
SOCIAL

GOVERNANCE
GovernanceRisk Management

Ethical and ComplianceManagement
Information Security

APPENDIX

Risk Management
On/offshore Risk Management

We encounter a diverse range of intricate risks that pose potential threats to its stable business

operations. In response, efforts are made to establish a risk management system aimed at pre-venting these risks from causing disruptions and ensuring prompt recovery. To this end, POS SM
has obtained the ISO 22301 Business Continuity Management Certification, signifying its commitment to effective business continuity practices. The company addresses both onshore andoffshore risks by leveraging the Business Continuity Management System (BCMS) as a framework
for managing and mitigating potential disruptions.

Potential Risks and Response Activities
Category

Details

Increase in customers due to market fluctuations andincrease in business activities, and other internal and external

Account Risks

factors leading to constant exposure to account risks

IMO set to gradually introduce carbon emissions regulations toEnvironmental
Risks

2023 PAN OCEAN ESG REPORT

achieve the GHG reduction goals in shipping

Scope of the BCMS
OnshoreVessel management for safe cargo transportand offshore employee management service
activities and personnel

Offshore

Safe vessel operations and cargo transport
activities and personnel

POS SM ISO 22301
certificate

Response
ㆍContinue account risk management by establishing organized management and foundations
for the CRM, constant account monitoring and rating, and developing databases of accountdetails.

- Prevent
and respond to risks by adjusting account rating and scope through CRM by internalreporting, Risk Management Committee, sharing internal information, notifying the changes,
and assessing additional monitoring activities.

ㆍEstablish a fleet management system to proactively and systematically respond to regulations anddevelop operational/technical solutions.
- Improve
fleet performance and establish well-organized operating plans to maximize operating
efficiency in response to the vessel rating system slated in 2024.

76
OVERVIEWESG IMPACTENVIRONMENTAL
SOCIAL

GOVERNANCE
GovernanceRisk Management

Ethical and ComplianceManagement
Information Security

Ethical and Compliance Management
Ethical Management Vision and System

We have established our ethical management vision as a guiding blueprint for the future, outlining our principles and values. In the pursuit of our vision, “Clean and Healthy Hands Carrying Our Clients’Dream,” we practice corporate-wide ethical management.

Ethical Management Vision* HANDS: inspired by the concept from ltalian "mani pulite"

Clean and healthy HANDS carrying our clients' dream

Pan Ocean's Ethical Management Department reports directly

to the CEO, and the Ethical Management Team, under its purview, is responsible for ensuring ethical management practices. The ethical management organization formulates and

APPENDIX

executes audit plans to assess compliance with corrective andIntegrityㆍManagement

HealthㆍSoft Power

Customerㆍ Value Creation

We make our HANDS clean, wemake our HANDS stronger, andcreate value forour customers with our HANDSBuild an EthicalManagement System

ㆍSubstantialize an ethical management
systemㆍBuild an effective audit system
ㆍEstablish anonymous reporting systems
ㆍEvaluate and improve ethical management activities
ㆍInspect management transparency

2023 PAN OCEAN ESG REPORT

Ethical management organization andoperational system

Establish an Ethical Culture

ㆍCEO communication
ㆍVitalize campaigns and community
activities
ㆍEducate appropriate ethics in accordance to duty/position
ㆍPromote social contribution activities

Practice Self-Regulation System

ㆍImprove client service quality
ㆍTake preventive measures against
unfairness
ㆍEstablish self-compliance programs
ㆍLink CRM activities
ㆍUtilize Company IR

Client satisfaction survey, employee ethics diagnosis, self-diagnosis of practice of ethical management

improvement measures based on the findings of audits. It alsoestablishes corporate ethical management policies and con-ducts ethical management activities accordingly. We maintainongoing monitoring of internal policies and regulations, making necessary improvements as required.

77
OVERVIEW

Ethical and Compliance Management

ESG IMPACT

Strengthening the Ethical Management System

SOCIALPan Ocean has implemented several essential documents, the Charter of Ethics, the Code of

ENVIRONMENTAL
GOVERNANCE
GovernanceRisk Management

Ethical and ComplianceManagement
Information Security

APPENDIX

Establishing Basic Rules of Ethics

Operating the Reporting and Inquiry System

Ethics, and the Ethical Management Guidelines, to cultivate an ethical culture within the organi-opinions on ethics and compliance-related matters. The system is divided into a helpline forzation. The Charter of Ethics serves as the highest standard and guiding principle for ethical man-agement at Pan Ocean, reflecting the company's strong commitment to achieving its corporate
vision. It sets the foundation for ethical conduct throughout the organization.

The Code of Ethics provides a comprehensive elaboration of the principles outlined in the Char-ter, serving as a practical guide for employees to internalize and embody these values in their dayto-day work. The Ethical Management Guidelines have been developed to support employees innavigating ethical dilemmas that may arise in their professional activities. All these principles are

not only shared with our members but also publicly disclosed on our website to demonstrate our

We operate an anonymous reporting system, allowing all stakeholders to freely express theirreporting and a compliance Q&A system for inquiries and consultations. Through the helpline,

individuals can report actions that violate fundamental ethical values, such as unfair job performance, unjust gain, and behaviors that undermine a sound corporate culture. The compliance

Q&A system serves as a platform for our employees to inquire and seek advice on practical ethicaldilemmas or situations involving corruption. This system is easily accessible through our website

and ensures the strict protection of the reporter's anonymity by being operated through an external third-party service provider.

commitment to ethical management to external stakeholders.
Charter of Ethics

Supreme ethical value and standards

Code of Ethics

Area-specific elaboration of the Charter of Ethics as guides tovaluation and behavior

Ethical Management
Guidelines

2023 PAN OCEAN ESG REPORT

Concrete guidelines for the implementation of the Code of Ethics at work

① Fill out inquiry form

Inquirer② Inquiry received

Help Line⑥ Check progress and results※ If the inquiry is crucial① Pre-reporting to top management② Order investigation and actions on inquiry

EthicalManagement
Team⑤ Notify progress and resultsTopmanagement③Investigation, consultation, consideration④ Inquiry processing and measures

78
OVERVIEW

Ethical and Compliance Management

ESG IMPACT

Strengthening the Ethical Management System

SOCIALPan Ocean recognizes the essentiality of maintaining ethical and transparent business practices to

ENVIRONMENTAL
GOVERNANCE
GovernanceRisk Management

Ethical and ComplianceManagement
Information Security

APPENDIXInternal Anti-Corruption Program

enhance corporate sustainability. As a result, the company has taken the initiative to establish its
own Anti-corruption Program (AP) to prevent corruption. Regular anti-corruption risk assessments
are conducted to identify potential risks and develop corresponding strategies for proactive prevention and immediate response. The ultimate goal is to establish a system that enables the prevention
and swift response to corruption issues.

To achieve this, Pan Ocean is in the process of constructing its unique corruption risk map, taking
reference from the "Compliance Program Guidelines" by the Anti-Corruption & Civil Rights Commission and the "ISO 37001 Anti-Bribery Management Systems Guidebook". Starting from the second

half of 2023, these measures will be implemented across all business activities and employees of
the company.

Pan Ocean conducts annual internal campaigns to promote ethical management practices.
Through campaigns such as year-end ethical management practice, abstaining from receiving
gifts during the Lunar New Year, and abstaining from receiving gifts during the Chuseok holiday,
the company strives to internalize ethical awareness among its employees. Since 2022, online

video training sessions (utilizing content from the Anti-Corruption and Civil Rights Commission'sIntegrity Training Institute) on corruption prevention and other unethical behaviors have been
conducted at least three times a year, targeting all employees across the organization, to foster

a positive understanding of ethical and compliance values. In addition, Pan Ocean sends out biweekly corruption prevention guidance emails to enhance employees' understanding of anti-cor-

ruption issues and promote the stable implementation of the ongoing anti-corruption program.

Similarly, POS SM has been conducting ethics and compliance training since 2020 and plans tocontinuously expand the scope and duration of the training to reach a larger audience.

Implementation of Pan Ocean Ethical Management Campaigns

Identifying Corruption Risks

Category

Unit

2020

2021

2022

Abstaining from Receiving Gifts on New Year

cases

1

1

1

Year-end/New Year ethical practices

Risk TypeNo. Identified

Risk of Pursuing Personal Interests

16

Risk of Misconduct in Relationships with Accounts

11

Risk of Financial Misappropriation

6

Risk of Undermining Organizational Culture

8

Risk of Undermining Organizational Culture

7Completed risk assessment and mitigation measures for a total of
48 items across 5 types of corruption risks.
2023 PAN OCEAN ESG REPORT

Raising Employee Ethical Awareness

Abstaining from Receiving Gifts on Chuseok
Total

cases

1

cases

1

cases

3

Ethical and Compliance Training Records at Pan Ocean

1

1

3

Category

Unit

2020

2021

Training hours

hours

-

-

No. of trainees
Completion rate

people-%Online Ethics Training for All Employees to Prevent Unethical Conduct, starting from 2022-

Ethical and Compliance Training Records at POS SM

-

2021

Training hours

hours

576

1,185

Completion rate*

%

88.6

* Completion rate = no. of trainees / total employees (excluding part-timers and PJT contract workers)

2022

382

312

2022

2020

109

3

100.0

Unit

people1-Category

No. of trainees

1

136

100.0

141

523

100.0

79
OVERVIEW

Ethical and Compliance Management

ESG IMPACT

Compliance with Fair Trade Practices

SOCIAL

Under the strong commitment of the CEO, we are actively promoting a fair trade culture through

ENVIRONMENTAL
GOVERNANCE
GovernanceRisk Management

Ethical and ComplianceManagement
Information Security

APPENDIX

Self-Compliance Program (CP)Compliance Survey and Monitoring

substantial implementation. To ensure compliance with fair trade regulations, we have voluntar-

nually to reflect any necessary modifications. The adequacy of these inspection results is verified

ily established and operates an internal control system called the 'Self-compliance Program.' The

program is designed to prevent any potential violations of fair trade laws and regulations, with the
Self-compliance Administrator taking overall responsibility.

Furthermore, in 2022, we published the Fair Trade Compliance Handbook and distributed it
throughout the organization to ensure all employees are familiar with its content. We plan to continuously update the program to reflect legal revisions and new case law, and conduct periodic

compliance training through the Self-Compliance Managers to enhance employees' understanding of fair trade practices. Through these proactive program initiatives, we aim to instill a strong
sense of compliance among its employees and foster a culture of integrity and fairness.

Manage overall Self-compliance
Program operations

Cooperative Organization(Ethical Management Department)Internal monitoring, CP audit, etc.

Review and advise on importantfair-trade issues

2023 PAN OCEAN ESG REPORT

Conduct working-level activities such as publishingfair trade manuals and offering training

legal qualifications to assess compliance with compliance control standards. They monitor thecompliance of management and employees, as well as the legality of company operations, while

performing various compliance support activities. Moreover, the inspection results of complianceofficers are reported to the Board of Directors on a mandatory basis, and the details are transparently disclosed in the business report.

Ethical Management and Compliance Pledge

All employees of Pan Ocean pledge to understand and uphold the principles of ethical management. This commitment aims to disseminate a corporate culture that prioritizes ethical and legal-

achieving responsible management. Pan Ocean actively conducts such initiatives to foster a shared

Self-Compliance Committee

Self-Compliance Bureau

through compliance officers. Compliance officers are individuals appointed with the necessary

ly compliant business management, promoting a sense of responsibility among all members forCEO
Self-Compliance Administrator

To conduct team-based self-compliance survey, we review and update the inspection items an-

Self-Compliance Managers

Identify and monitor team-specificfair-trade risks

understanding of ethical values and cultivate a sense of legal compliance among its workforce.

Campaign to Enhance Ethical Awareness
Each month, we produce var-ious materials such as ethicalmanagement practice guidelines, posters, webtoons, and
Q&A documents as a part ofongoing "Ethical AwarenessCampaign.". These materials

are disseminated online andprominently displayed within
our workplace.

80
OVERVIEW

Information Security

ESG IMPACT

Information Security Management System

SOCIALPan Ocean's information security organization is tasked with developing and reporting security

ENVIRONMENTAL
GOVERNANCE
GovernanceRisk Management

Ethical and ComplianceManagement
Information Security

APPENDIX

Information Security Policy and Organizationplans, conducting checks and monitoring of information security activities, and overseeing over-all security operations within the company. The Chief Information Security Officer (CISO) and theChief Privacy Officer (CPO) play key roles in ensuring the stable operation of the security system.
Pan Ocean participates as an active member in the CISO Council and maintains an internal teamof IT and information protection professionals. Recently, we introduced privacy solutions andIn response to the continuously growing risks of privacy breaches and information leakage, Pan
Ocean carries out the following activities to enhance the level of privacy protection.
ㆍEstablish and report privacy protection activity and improvement plans
ㆍTrain all employees on privacy protection (statutory training)ㆍOffer privacy protection training courses (CPO and relevant staff)

ㆍParticipate in the unique identification information safety measure management survey

leveraged professional maintenance services to establish a stable information security system.

ㆍConduct activities to ensure personal information safety

Building the Information Security InfrastructureㆍClear personal information stored in our systems (retention policy)

Technical Security

Pan Ocean employs a variety of technical security solutions to safeguard against external threats,
including hacking, malware, and ransomware, as well as prevent internal network and system

breaches. These measures include the implementation of firewalls, web firewalls, document encryption, and database access control. Regular upgrades of Windows security patches have been
performed on both servers and workstations to enhance the overall security system.

Administerial Security

The security policy and regulations are systematically managed and monitored. This includes theestablishment and periodic revision of comprehensive guidelines to ensure continuous improvements. Also, regular user security drills are conducted, including participation in Korea Internet &Security Agency (KISA) simulation tests, to enhance employees' ability to respond to cybersecurity breaches and to promote a heightened sense of security awareness.

2023 PAN OCEAN ESG REPORT

Personal Information Protection

ㆍIncorporate amendments to the privacy law in our systems
ㆍPurchase a privacy damage liability insurance policy

Information Security Disclosure

In 2022, Pan Ocean began disclosing important information related to security details on its infor-

mation security disclosure portal. In 2022, the company prioritized investments to replacementof the Main Firewall, Block Non-Business & unsafe site solution, and procurement of personal information liability insurance.

Investment in privacy protection(As of 2022)

Investment Proportion in Information
Security Sector Compared to IT Sector
Investment (As of 2022)

530
8.7

million KRW%

81
OVERVIEW

Information Security

ESG IMPACT

Vessel Security Management

SOCIAL

Vessels are exposed to risks of external cyber-attacks on their

ENVIRONMENTAL
GOVERNANCE
GovernanceRisk Management

Ethical and ComplianceManagement
Information Security

APPENDIX

Onboard Cybersecurity System

operation systems. With the widespread adoption of informa-tion technologies, such as automation and autonomous ves-

sel operation systems, the potential impact of cyber-attacks
on vessels has become increasingly significant. To mitigate

these risks, a series of measures are implemented to strength-

en the cybersecurity of our vessels. All vessels are equippedwith firewalls, and comprehensive cybersecurity plans areincluded in the vessel administration manual. Also, onboard
security officers and managers are designated to prevent security breaches.

Response to Security Breaches

Security breaches are immediately reported to the CPO andresponsible organization upon detection to take instant recovery measures. Access and time logs, and other details about

the incident are collected, stored, and used to develop measures to prevent recurrence.

Security Breach Prevention Activities
Security Risk Assessment

Security risk assessments are regularly conducted to identify vulnerabilities and proactively address potential cyber-threats within

the onboard IT systems. These assessments aim to identify critical vulnerabilities, potential security breaches, and their potential

impact on vessel operations. In particular, risk assessments are carried out when there is a offshore employee change, significant
program updates, or in the event of suspected malware infections. In 2022, we developed and implemented an Internal Audit Check
List specific to maritime operations.

Strengthening Physical Security

In addition to implementing technical security solutions and infrastructure, Pan Ocean has established a security USB system toenhance physical security measures. Workstations are equipped with locks to prevent unauthorized access, and USB ports are kept
in a locked state. Only pre-approved portable storages are allowed to prevent data leakage, virus infections, and data deterioration.

Visitor protocols are in place to ensure cybersecurity. Visitors receive comprehensive briefings on the company's cybersecurity rules
and are required to sign a declaration acknowledging their compliance. Separate workstations, isolated from the main network, areprovided for visitors who need to use computers, ensuring the security and integrity of the company's systems. In 2022, we introduced the widespread use of LAN port lock devices for our maritime network equipment.

Onboard Cybersecurity Training

Promoting offshore employees’ cybersecurity awareness is crucial for the effective prevention of cyber-threats. We conduct onboard
cybersecurity training for employees embarking on their first voyage and all offshore employees. In 2022, we conducted information
security drills and cyber security campaigns.
Training Period
ㆍTraining for employees embarking on their firstvoyageㆍRegular half-annual training

2023 PAN OCEAN ESG REPORTTopicsㆍUse of emails and the internet (including Wi-Fi)
ㆍHow to respond to and report cybersecurity
ㆍUse of personal devices (including portable storage incidents
ㆍRisks for security breaches from visitors
devices)ㆍSecurity system updates, vaccine programs, etc.
ㆍHow to set passwords and manage personal/
confidential information

OVERVIEW

APPENDIX83

ESG Data

102

SASB Index

95

104
105
106
107

GRI Contents Index
TCFD Index

Third-party Verification Statement
GHG Verification Statement

Association Memberships and Awards Achievements

ESG IMPACTENVIRONMENTAL

SOCIAL

GOVERNANCE

APPENDIX

83
OVERVIEWESG IMPACTENVIRONMENTAL
SOCIAL

GOVERNANCE
APPENDIXESG Data

GRI Contents Index
SASB Index
TCFD Index

Third-party Verification
Statement
GHG Verification
Statement

Association Memberships
and Awards Achievements

ESG Data
Financial

Condensed Consolidated Statements of Financial Position
Category
AssetsCurrent assets

Non-current assets
Total assets

Liabilities

Current liabilities

Non-current liabilities
Total liabilities

EquityEquity attributable to theowners of the Group
Share capital

Capital surplus

Other capital

Retained earning

Non-controlling interests

Total equity

Total liabilities and equity

2023 PAN OCEAN ESG REPORT(Unit: KRW Million)

2020

2021

662,523

1,358,712

1,834,200

4,659,327

6,488,779

7,548,942

3,996,804

5,130,067

604,301

1,149,410

1,852,675

2,891,942

1,248,374

2,806,652

534,570

717,132

1,742,532

3,596,837
534,570

717,132

1,226,301

1,493,821-1,807

0328,649

2,806,652

4,659,327

2022

5,714,742

1,226,756(단위: 백만 원)

1,829,582

3,056,338

4,492,604
534,570

717,132

1,766,202

851,3141,474,700

3,596,837

4,492,604

6,488,779

0

7,548,942

Condensed Consolidated Statements of Comprehensive Income
Category
Sales

Cost of sales

Gross profit

Selling and administrative
expenses

2020

2,497,159

78,721

92,785

110,329

303,933

64,629

Income tax expense

Profit for the year

Other comprehensive
incomeTotal comprehensive income

6,420,312

5,520,365

Financial costs

Profit before income tax

2022

3,950,376

225,212

Share of profit of associates
and joint ventures
Other non-operating
expenses, net

4,616,107(Unit: KRW Million)

2,193,226

Operating profit

Financial income

2021

17,158665,731572,946

789,618

60,049150,645

30,118

5,377

12,63991,956550,358-91,162
1,234

90,722-170,580-79,858

899,947-5,296
1,053

549,305

267,608

816,913

97,017

18,510-66,533

687,967
10,886

677,081273,347

950,428

84
OVERVIEWESG IMPACTENVIRONMENTAL
SOCIALESG Data
Financial

Economic Value Creation and Distribution
Category

GOVERNANCE
APPENDIXESG Data

Sales bybusiness area

GRI Contents Index

Bulk carriersContainers
Tankers

LNG carriers
Agri-trading

SASB Index

Others(ship management, leasing, etc.)

Third-party Verification
Statement

Shareholders and investors

TCFD Index

GHG Verification
Statement

Association Memberships
and Awards Achievements

Economic value
distribution

Employees

Governments

Local communities

Government Subsidies and Grants
CategoryTax exemptions and deductions
Subsidies

Investment, R&D, and others
Rewards

Financial supports from export credit agencies
Loyalty exemption

Financial incentives
Others(guarantee)2023 PAN OCEAN ESG REPORT

Unit

KRW
million
KRW
million
KRW
million
KRW
million
KRW
million
KRW
million
KRW
million
KRW
million
KRW
million
KRW
millionUnit

KRW
million
KRW
million
KRW
million
KRW
million
KRW
million
KRW
million
KRW
million
KRW
million

2020

2021

2022

1,757,973

3,569,191

4,823,826

142,671

140,167

305,867

246,667

14,698376,663

353,341

93,618498,182

509,420

171,762702,018

202,489

234,897

266,969

66,40793,552

148,520

193,716

1,234

1,071

2020

247,950

1,053

1,427

0

0

0

0

0

0

0

0

0

0

2021

2022

New employee, male (onshore)

KRW

3,630,500

3,747,200

3,901,200

Minimum wage (onshore)

KRW

1,941,340

1,970,720

2,070,160

Pan Ocean

New employee, female (onshore)% new employee wage in comparison tominimum wage (male)% new employee wage in comparison tominimum wage (female)

KRW

%

%

3,630,500

187

187

3,747,200

190

190

3,901,200

188

188

4,151,819

4,242,113

4,506,625

10,886

Minimum wage (offshore)

KRW

1,795,310

1,822,480

2,010,580

317

7,022

0

2020

KRW

6,512

0

6,609

Unit

New employee, male (offshore)

2022

10,847

Category

290,2462021

11,964

New Employees' Wage in comparison to Minimum Wage, by Gender

6,520

0

0

0

0

0

0

New employee, female (offshore)% new employee wage in comparison tominimum wage (male)% new employee wage in comparison tominimum wage (female)

KRW

%

%

4,151,819

231

231

4,242,113

233

233

4,506,625

224

224

Category

Unit

2020

2021

2022

New employee, male

KRW

3,188,000

3,284,000

3,416,000

Minimum wage

KRW

1,795,310

1,822,480

1,914,440

POS SM

New employee, female% new employee wage in comparison tominimum wage (male)% new employee wage in comparison tominimum wage (female)

KRW

%

%

3,188,000

178

178

3,284,000

180

180

3,416,000

178

178

85
OVERVIEWESG IMPACTENVIRONMENTAL
SOCIAL

GOVERNANCE
APPENDIXESG Data

GRI Contents Index

ESG Data
Financial

Ethical Code Violations and Disciplinary Measures
Category

Pan Ocean

Ethical code violations

SASB Index
TCFD Index

Third-party Verification
Statement

Disciplinary measures

GHG Verification
Statement

Association Memberships
and Awards Achievements

Unlawfulness/fraud
Petition (complaints, grievances)
Unfair trade/corruption
Other unethicalconduct

Total

Heavy sanction
Light sanction

Category
POS SM

Ethical code violation

Disciplinary measures(Based on onshore staffs)

2023 PAN OCEAN ESG REPORT

Total

Total

Unlawfulness/fraud
Petition (complaints, grievances)
Unfair trade/corruption
Other unethicalconduct

Total

Heavy sanction
Light sanction

Unit

2020

2021

2022

cases

1

-

-

cases

1

-

-

cases

-

cases

cases

-

-

-

-

-

-

-

cases

1

cases

1

Unit

2020

2021

2022

cases

1

2

4

cases

1

2

2

cases

-

-

2

cases

cases

cases

cases

cases

cases

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

1

-

1

Ethical Management Practice and Compliance Pledge
Category

No. of signees% signed

Compliance Inspection
Category
Subjects
Results

Unit

2020

2021

2022

people

882

927

1,029

peopleNo. of subjects

Teams inspected
Inspection items

Compliance results

887

931

1,032

%

99.4

99.6

Unit

2020

2021

2022

items

143

143

153

teams

%

49

100.0

53

100.0

99.7

56

100.0

86
OVERVIEWESG IMPACTENVIRONMENTAL
SOCIAL

GOVERNANCE
APPENDIXESG Data

GRI Contents Index

ESG Data
Financial

Total Annual Salary
Category

Pan OceanHighest earner’s annual salary

Average annual salary of all employees(excluding highest earner)

Highest earner’s annual salary rise

Average annual salary rise of all employees(excluding highest earner)

SASB Index

Total annual salary increase

Third-party Verification
Statement

Category

TCFD Index

GHG Verification
Statement

Association Memberships
and Awards Achievements

POS SM

Highest earner’s annual salary

Average annual salary of all employees(excluding highest earner)

Highest earner’s annual salary rise

Average annual salary rise of all employees(excluding highest earner)

Local Workforce in Major Operations
Category

Locally hired employees

Senior workforce hired% senior workforce among locally hired employees

2023 PAN OCEAN ESG REPORTBoard Composition

Unit

2020

2021

2022

KRW
million
KRW
million

536

786

1,039

Board

46.6

32.2

Registered female executives

87

100

111

%

-1.1

%

12.1

24.4

15.1

Unit

2020

2021

2022

%

6.1

KRW
million
KRW
million

190

%

%

70

213
79

11.0

242
83

1.8

11.7

12.5

14.1

Unit

2020

2021

2022

people23

19

19

people
%

2.2

14.9

150

15.3

149

12.8

5.3

167

11.4

Category2022

people333

Independent
directors

peopleShareholder Composition
Name

Harim Group and affiliatedpersonNational Pension Service
Total

2021

peopleCEO-BoD Chair separation

Others

2020

Total

Inside directors(As of end of each year)

Unit

peopleY/N

No. of shares

292,766,068
37,978,398

203,825,046
534,569,512

7

4

-

N

% shares

7

4

-

N

6

3

-

N

(As of December 31 2022)

Relation

54.8

Largest shareholder andaffiliated person

38.1

-

7.1

100.0

-

87
OVERVIEWESG IMPACTENVIRONMENTAL
SOCIAL

GOVERNANCE
APPENDIXESG Data

GRI Contents Index
SASB Index
TCFD Index

Third-party Verification
Statement
GHG Verification
Statement

Association Memberships
and Awards Achievements

ESG Data
Environmental
Energy Consumption
Category

Owned vessel’s fuel consumption(Scope1)
HFO(B-C oil)

LFO(B-C oil)DO(B-A oil)
LNG

Corporate vehicles fuel consumption(Scope1)Gasoline
DieselElectricity(Scope2)

Chartered vessel's fuel consumption(Scope3)

Unit
TOE

TOE

TOE

TOE
TOE

TOE

Energy saving (per unit of sales)

406,961

401,750-

33,643

2,341

43,22017

388,916
54,518
17

305

293

240

1

1

1

TOE

463,336

711,485

707,854

TOE

423,059622,398549,357

TOE

758,511884,348

848,79036.07021.73314.890

KRW 100
millionTOE/
KRW 100
million%

15,17625,101

21,02912.7

42,68046,407
40,692-39.7

81,48977,00857,004-31.5* Includes energy consumption by vessel and domestic operations; Scope 3 excluded from total energy consumption and intensity estimation.
** (Scope1 + Scope2 energy consumption) / Pan Ocean separate sales

2023 PAN OCEAN ESG REPORT

Other indirect GHG
emissions(Scope 3)

Sales

2021

2022

2,382,970

2,757,404

2,669,080

VehiclestCO2eq49

48

54

53,870Total (Scope1 + Scope2)

2020

tCO2eqIndirect GHG emissions Power purchase(Scope2***)

19

Unit

Mobileconsumption

Direct GHG emissions(Scope1*)

TOE

TOE

Category

390,570

18

TOE

Energy intensity(per unit of sales)**412,382

302,587

16

DO(B-A oil)

Sales

2022

848,53116

TOE

Total energy consumption*(Scope1+2)

2021

884,038TOE

HFO(B-C oil)
LFO(B-C oil)2020

758,189

GHG Emissions

Vessels**tCO2eqtCO2eqtCO2eqUpstream

tCO2eqLeased assets

tCO2eqProducts andservices purchased
Transport andlogistics
Employees
business travel
Employees
commuting

GHG emissions intensity**** (per unit of sales)

tCO2eqtCO2eqtCO2eqtCO2eq

KRW 100
milliontCO2eq/KRW 100
million2,382,921
569

2,383,539
1,453,048-

1,453,048-

2,757,356

539

2,757,943

2,669,026
483

2,669,563

2,884,436

3,738,975

2,232,155

2,219,848

42

188

22,191

629,96583

9,532

1,509,302
105

21,02940,69257,004113.346

67.77646.831(Scope 1, 2, 3 estimates include CO2, CH4, and N2O.)* Scope1: Pan Ocean’s self-owned fleet, corporate car** T otal fuel consumption and incinerator usage in vessels. In the case of incinerator usage, the data from 2019-2020 are excluded as aggregationand verification began in 2021*** Scope 2: Power consumption by Pan Ocean’s domestic operations**** (Scope1 + Scope2 emissions) / Pan Ocean separate sales

88
OVERVIEWESG IMPACTENVIRONMENTAL
SOCIAL

GOVERNANCE
APPENDIXESG Data

GRI Contents Index
SASB Index
TCFD Index

ESG Data
Financials

Air Pollutant Emissions
Category

Association Memberships
and Awards Achievementskg

NOx(nitrogen oxides)kg

SOx(sulfur oxides)

2020

63,851,643

7,511,958

2021

71,729,675

8,438,785(Emission factor based on IMO MEPC Cir. 681, 2nd IMO GHG STUDY 2009(MEPC59 INF.10), 4th IMO GHG STUDY 2020)

Water withdrawal
Category

Third-party Verification
Statement
GHG Verification
Statement

Unit

Water Withdrawal

Head OfficeBusan Office Sales
Team

Gwangyang OfficePohang OfficeDangjin Office

Water recycling

Total

2022

71,249,120

8,382,249

2020

2021

2022

㎥

292

279

292

㎥

㎥

㎥

㎥

㎥

7,465

-

-

-

7,757

-

Category

Waste generation
General wastefrom vessels(non-hazardous)

Unit
㎥

Waste

6,295

-

-

-

6,574

-

-

-

Cargo residues

OthersWaste oil

Designated wastefrom vessels(hazardous)

Waste absorbent

Plastics

Ashes

Others

Office Waste

2022

28,40529,695

ton

1,684

1,949

2,225

ton

-

-

-

ton

ton

ton

325
-

2,009

348
-

2,297

350
-

2,575

ton

20,87823,437

25,113

ton

1,106

1,306

1,452

ton

ton

ton

628

366
-

922

443
-

440

113
-

27,118

Busan Office Sales Team

ton

0.55

0.63

0.56

Dangjin Office

ton

0.25

0.13

-

Pohang Office

General waste (non-hazardous)–Office
Designated waste (hazardous)-Vessel*Total% total waste recycled* Plastics and sludge from vessels

2023 PAN OCEAN ESG REPORT

2021

24,987

26,108

Total
Waste recycling

2020

ton

22,978Head Office

-

Unit

ton

Total

5,703

(No data available for Pohang and Dangjin Offices’ water withdrawal, 100% water supplies, No water recycling, Except for water withdrawal invessels)

Food waste

Domestic waste

Total

5,372

39

Total

ton

ton
ton
ton
ton

ton
%

-

0.08
0.88

-

7,311

7,311
29.3

2.21

0.05

1.39

-

3.02

1.96

9,604

10,159

-

9,604
33.8

-

10,15934.2

89
OVERVIEWESG IMPACTENVIRONMENTAL
SOCIAL

GOVERNANCE
APPENDIXESG Data

GRI Contents Index
SASB Index
TCFD Index

Third-party Verification
Statement
GHG Verification
Statement

Association Memberships
and Awards Achievements

ESG Data
SocialEmployees
Category

Pan Ocean
Total
employees*

By employment
type

By ageBy geography

By position**

2023 PAN OCEAN ESG REPORT

Total
OnshoreMale
FemaleOffshore
Male
FemaleOnshoreRegularNon-regular
Offshore
RegularNon-regular
OnshoreUnder 30
30 - 49
50 or older
Offshore
Under 30
30 - 49
50 or older
OnshoreDomestic
International
Offshore
Domestic
International
OnshoreMale
SeniorManager
FemaleMaleManager
FemaleMale
Staff
FemaleOffshore
Master/Cheif Male
Engineer
FemaleMale
Officers
FemaleMale
Ratings
FemaleUnitpeoplepeoplepeoplepeoplepeople

2020

1,061
327
246
81
734
725
9
327
322
5
734
434
300
327
16
272
39
734
248
243
243
327
323
4
734
734
327
148
11
71
32
27
38
734
194
395
9
136
-

2021

1,135
352
258
94
783
771
12
352
341
11
783
480
303
352
34
269
49
783
261
267
255
352
348
4
783
783
352
156
14
73
33
29
47
783
226
418
12
127
-

2022

1,146
371
271
100
775
759
16
371
350
21
775
484
291
371
48
274
49
775
247
284
244
371
366
5
775
775
371
166
12
63
35
42
53
775
217
413
16
129
-

* Based on the business report criteria (excluding registered executives and corporate personnel)** B ased on the revised personnel system criteria for 2023 (SeniorManager (ex.deputyhead), Head of Division, Head of Department, Manager (ex.
section chief and deputy section chief), Associates (including administrative support positions))

Category
POS SM

Total employees

By employment type
By ageBy geography

By position*

Total
RegularNon-regular
Under 30
30 - 49
50 or older
Domestic
International
Lower level manager
Male
FemaleMid level manager
Male
FemaleUpper level manager
Male
FemaleOthers* Lower level manager: Associate
Middle level manager: Manager
Upper level manager: Senior Manager
Others: Foreman and PJT supervisor

Unit

2020

2021

2022

people

132
115
17
16
105
11
131
1
16
11
5
56
53
3
29
29
31

150
127
23
21
111
18
149
1
17
12
5
56
52
4
34
34
43

156
130
26
17
116
23
155
1
15
11
4
59
54
5
32
32
50

peoplepeoplepeoplepeople90
OVERVIEWESG IMPACTENVIRONMENTAL
SOCIAL

GOVERNANCE

ESG Data
SocialEmployees
Category

Pan Ocean

APPENDIXESG Data

GRI Contents Index
SASB Index

OnshoreNew recruitment

TCFD Index

Male

FemaleOffshore
Male

Third-party Verification
Statement

FemaleOnshoreGHG Verification
Statement

Association Memberships
and Awards Achievements

Total

Turnover*

2020

2021

2022

people

206

235

169

people162429

peoplepeople

19

3

39

15

43

14

people

187

196

126

people273people

185

189

123

Total turnoverrate
Voluntary turnover rate%

Total turnoverrate
Voluntary turnover rate

%

10.2

8.4

9.8

years

9.2

8.8

8.9

Offshore

Total
Avg. length of service

Unit

Onshore(Male)

Onshore(Female)
Offshore(Male)

Offshore(Female)

%

%

years

years

years

years

3.3

2.5

8.9

13.2

12.6

7.6

2.3

3.6

3.1

6.8

13.1

11.7

7.2

1.8

5.4

4.9

8.6

13.2

11.6

7.2

2.3

*T
 otal turnover rate = Employees that resigned within the year / Total employees at the end of the year
Voluntary turnover rate = Employees that voluntarily resigned within the year / Total employees at the end of the year
Total employees at the end of the year : including overseas offices
Employees that resigned : including executives, independent directors, and employees with expiring contracts
Employees that voluntarily resigned : excluding executives(except for voluntary resignation), independent directors, and resigned employees with
expiring contracts

2023 PAN OCEAN ESG REPORT

Category
POS SM

New recruitment

Turnover*Avg. length of service

Total

Male

FemaleTotal turnoverrate
Voluntary turnover rate

Male

Female

Unit

2020

2021

2022

people3655

39

people1118

7people

25

37

%

12.1

24.0

19.9

years

9.8

9.9

9.2

%

years

2.3

6.8

5.3

4.5

* The calculation formula for total turnover rate and voluntary turnover rate is the same as that used in the headquarters of Pan Ocean(Including executives, PJT contract workers, part-timers)

Retiree Re-employment
Category

Chief Engineer
Ratings
Total

Deck

StewardEngine

7.7

6.5

Unit

2020

2021

2022

people313850

peopleMaster32

peoplepeoplepeoplepeople

20

19

12

18

100

29

18

13

19

117

28

23

12

25

138

91
OVERVIEWESG IMPACTENVIRONMENTAL
SOCIAL

GOVERNANCE
APPENDIXESG Data

ESG Data
Social

Education Training｜Time and Costs
Category

Pan OceanTraining time

GRI Contents Index

Third-party Verification
Statement
GHG Verification
Statement

Association Memberships
and Awards Achievements

2020

2021

2022

Total training timehours

22,15330,41032,804

Offshore

hours

8,376

12,94013,722

OnshoreAvg. training time perpersonTotal training costs

SASB Index
TCFD Index

Unit

Training costs

Onshore*Offshore**

Avg. training costs
per person(Training declined in 2020 due to COVID-19)* Total training costs + self-development (Welfare Card)** For Korean offshore employees

Category
POS SM

Training time
Training costs

Total training time

hours
hours/
person21

27

19,082
29

687,364,863

866,257,292

986,456,029

KRW

404,202,000

524,100,000

563,425,000

KRW
KRW/
person283,162,863
647,846

342,157,292
763,222423,031,029
860,782

Unit

2020

2021

2022

hours

4,783

8,364

9,537

KRW

36,797,345

67,609,518

63,356,729

hours/
personAvg. training costs
per person

KRW/
person39

299,165(Training declined in 2020 due to COVID-19)(Employees total at the end of the year; those on leaves, PJT contract workers, part-timers excluded)2023 PAN OCEAN ESG REPORT

17,470KRW

Avg. training time perpersonTotal training costs

13,77762

500,81173

483,639

Education Training｜Human Rights Training
Category

Pan Ocean
OnshoreNo. of trainees
Completed% completion
Offshore
Workplace disability
awareness
No. of trainees
Completed% completion
POS SM
No. of trainees
Completed% completion
Pan Ocean
OnshoreNo. of trainees
Completed% completion
Offshore
Workplace sexual
No. of trainees
harassment prevention
Completed% completion
POS SM
No. of trainees
Completed% completion
Pan Ocean
OnshoreNo. of trainees
Completed% completion
Offshore
Workplace bullying
prevention
No. of trainees
Completed% completion
POS SM
No. of trainees
Completed% completion

Unit

2020

2021

2022

peoplepeople
%

347
347
100.0

374
374
100.0

394
394
100.0

peoplepeople
%

115
114
99.1

151
151
100.0

154
154
100.0

peoplepeople
%

734
734
100.0

783
783
100.0

775
775
100.0

peoplepeople
%

347
347
100.0

374
374
100.0

394
394
100.0

peoplepeople
%

115
115
100.0

159
159
100.0

168
168
100.0

peoplepeople
%

734
734
100.0

peoplepeople%Replaced withposting oftraining
materials

peoplepeople%-peoplepeople
%

734
734
100.0

783
783
100.0

374
374
100.0

783
783
100.0
142
142
100.0

775
775
100.0

393
393
100.0

775
775
100.0
146
146
100.0

92
OVERVIEWESG IMPACTENVIRONMENTAL
SOCIAL

GOVERNANCE
APPENDIXESG Data

GRI Contents Index
SASB Index
TCFD Index

Third-party Verification
Statement
GHG Verification
Statement

Association Memberships
and Awards Achievements

ESG Data
SocialInformation Security Training
Category

Pan OceanInformation security
training
POS SM

Information security
training

Total training time
No. of trainees

Total training time
No. of trainees

Client Information Protection
Category

Complaints on client information breaches
No. of client information breaches

Unit

2020

2021

2022

hours

347

374

393

peoplehours

people

347
345

115

374
135

135

393
153

153

Employee Diversity
Category

Pan Ocean% female employees

People withdisabilities
Foreign internationals

Unit

2020

2021

2022

cases

0

0

0

cases

0

0

0

Total

%

Offshore%

OnshoreTotal% employees withdisabilities
KD-TECH*% employees withdisabilities

GenderAge% female employees
People with disabilities

Foreign internationals
Veterans
Gender
Age

2022

9.3

10.1

1.5

2.1

%

24.8

26.7

people44peoplepeople

1.2

4

-

4

-

27.0

32

4

28

0.3

4.3

people

6

6

6

Male

people443Under 30

people---Female30 - 50

50 or older
Total

Total
% employees withdisabilities
Male

FemaleUnder 30

30 - 50

50 or older% base salary and compensation, female to male**2023 PAN OCEAN ESG REPORT

8.5

2021

0.4

% base salary and compensation, female to male**
POS SM

2020%

Veterans

Board diversity

Unitpeoplepeoplepeoplepeople

-

-

-

4

-

-

-

4

-

-

-

3

%

100.0

100.0

100.0

%

21

25

23

%

-

-

-

peoplepeoplepeople

-

-

-

-

-

-

-

-

-

people

104

112

122

people1621

17people28

38

34

people

105

111

116

%

100.0

100.0

100.0

people11

18

23*Recognizing a total of 50 individuals when considering a 2% weightage for severe disabilities in accordance with the Act on the Employment
Promotion and Vocational Rehabilitation of Persons with Disabilities, as a Standard Business Facility for Persons with Disabilities** Same base salary for male and female employees; no differential rates apply.

93
OVERVIEWESG IMPACTENVIRONMENTAL
SOCIAL

GOVERNANCE
APPENDIXESG Data

GRI Contents Index
SASB Index
TCFD Index

Third-party Verification
Statement
GHG Verification
Statement

Association Memberships
and Awards Achievements

2023 PAN OCEAN ESG REPORTESG Data
SocialParental Leaves
Category

Pan OceanMale, onshore
Female, onshore
Male, offshore
No. of employees thatused parental leaves
Female, offshore
POS SM
Male
FemalePan OceanMale, onshore
Female, onshore
No. of employees that
Male, offshore
returned from parental
Female, offshore
leavesPOS SM
Male
FemalePan OceanMale, onshore
Female, onshore% employees returning Male, offshore
from parental leaves
Female, offshore
POS SM
Male
FemalePan OceanMale, onshore
Female, onshore
No. employees that
Male, offshore r
served for 12 months
or more after parental
Female, offshore
leavesPOS SM
Male
FemalePan OceanMale, onshore
Female, onshore% employees serving
Male, offshore
for 12 months or more
Female, offshore
after parental leaves
POS SM
Male
FemaleUnitpeoplepeoplepeoplepeople
%
%
%
%

%
%

peoplepeople
%
%
%
%

%
%

2020

1
2
4
-

2

3
3
-

-

50
75
-

-

3
2
-

-

100
100
-

-

2021

1
4
6
-

1
2

3
5
-

1
2

100
83
-

100
50

3
2
-

1
-

100
83
-

-

2022

1
5
8
-

5
2

1
2
6
-

1
2

100
67
80
-

100
100

2
-

-

100
100
-

-

Employees Subject to Regular Performance and Career Development Review
Category

Pan Ocean*

Unit

%

2020

100

2021

100

2022

100

* Excluded: CEO/Executive Directors/Independent Directors, employees with less than 6-month service in the year, employees hired in the past 6months, emergency planning officer/labor union, contract workers (subject to separate evaluation)

Category

POS SM**** Excluded: PJT supervisors, part-timers

Welfare and Benefits
Category

Pan Ocean

Total welfare and benefit costs

Welfare and benefit costs per person
POS SM

Total welfare and benefit costs

Welfare and benefit costs per person(Based on separate financial statements in the Business Report)

Labor Union Membership
Category

No. of employees eligible
No. of Union members% membership(As of January each year)

Unit

2020

2021

2022

Unit

2020

2021

2022

KRW
million
KRW
million37,53844,50251,016KRW
million
KRW
million

1,323

1,695

1,938

Unit

2020

2021

2022

%

peoplepeople

%

79

35

10

243

203

83.5

83

39

11

250

207

82.8

83

45

12

279

241

86.4

94
OVERVIEWESG IMPACTENVIRONMENTAL
SOCIAL

GOVERNANCE
APPENDIXESG Data
SocialLost Time Incidents
Category

OnshoreESG Data

GHG Verification
Statement

Association Memberships
and Awards Achievements

2023 PAN OCEAN ESG REPORT

Lost time incident rate
(LTIFR)
Working hours **SASB Index

Third-party Verification
Statement

Lost time incidents

DeathsGRI Contents Index
TCFD Index

Working hours *Offshore

Lost time incidents

Lost time incident rate
(LTIFR)
Deaths

Unit

2020

2021

2022

hours

886,824

954,624

1,006,152

Lost time incidents
per million hours

1.13

-

-

hours

-

1,840,872

-

-

cases

peoplecases

Lost time incidents
per million hours
people1

11-1,963,764

8-

1,943,700

9

5.97

4.07

4.63

-

-

-

(A lost time incident involving lost time of multiple employees counted as a single incident)* Working hours: No. of employees at the end of the year * Monthly ordinary wage calculation base (226 hours) * 12 months
No. of employees based on the year-end Business Report** Working hours: No. of employees at the end of the year * Monthly ordinary wage calculation base (209 hours) * 12 months
No. of employees based on the year-end Business Report (domestic only, foreign nationals excluded)

Social Responsibility Activities
Category

Pan OceanSocial Contribution Investment Amount
Total donations

Employees’ fundraising
Volunteer activities
POS SM

Total donations*

Unit

2020

2021

2022

KRW
million
KRW
million
KRW
million

0.1

1,070

-

1,325

42

hours

40

-

-

Total volunteers

people20

Hours per person

hours

2.0

KRW
million

1.0

Total hours

-

214

1.7

84

-

247

2.4

2.4

-

2.9

95
OVERVIEWESG IMPACTENVIRONMENTAL
SOCIAL

GOVERNANCE
APPENDIXESG Data

GRI Contents Index
SASB Index
TCFD Index

Third-party Verification
Statement
GHG Verification
Statement

Association Memberships
and Awards Achievements

GRI Contents Index

Pan Ocean’s disclosures for the reporting period follow the Global Reporting Initiative Standards 2021.
Disclosure

Explanation

GRI 2: General Disclosures 2021

The organization and its reporting practices
2-1

Organizational details

7-10

2-3

Reporting period, frequency and contact point

About this report

2-2
2-4

Entities included in the organization’s sustainability reporting
Restatements of information

About this report-

2-5

External assurance

105

2-6

Activities, value chain, and other business relationships

7-16

2-8

Workers who are not employees

90

Activities and workers
2-7
Governance

Employees

90

2-9

Governance structure and composition

70-71, 86

2-11

Chair of the highest governance body

70-71

2-10
2-12
2-13
2-14
2-15
2-16
2-17
2-18
2-19
2-20
2-21

2023 PAN OCEAN ESG REPORT

Location

Nomination and selection of the highest governance bodyRole of the highest governance body in overseeing the management of impacts
Delegation of responsibility for managing impacts

Role of the highest governance body in sustainability reporting
Conflicts of interest

Communication of critical concerns

Collective knowledge of the highest governance body

Evaluation of the performance of the highest governance body
Remuneration policies

Process to determine remuneration
Annual total compensation ratio

72
71
71
71
77
73
70
71
71
71
-

Disclosed in the Business Report

96
OVERVIEWESG IMPACTENVIRONMENTAL
SOCIAL

GOVERNANCE
APPENDIXESG Data

GRI Contents Index
SASB Index
TCFD Index

Third-party Verification
Statement
GHG Verification
Statement

Association Memberships
and Awards Achievements

2023 PAN OCEAN ESG REPORTGRI Contents Index
Disclosure

Location

GRI 2: General Disclosures 2021
Strategy, policies and practices
2-22Statement on sustainable development strategy

2-24

Embedding policy commitments

2-23
2-25

2-26

2-27

2-28

Policy commitments

2-29

3-1

3-3

77-79

44, 77

Compliance with laws and regulations

27

Mechanisms for seeking advice and raising concerns

Membership associations

Approach to stakeholder engagement

Collective bargaining agreements

GRI 3: Material Topics 2021
3-2

76

Processes to remediate negative impact

Stakeholder engagement
2-30

Letter to Stakeholders

44, 77107
2356, 93

Process to determine material topics

19

Management of material topics

20-22

List of material topics

19-22

Explanation

97
OVERVIEWESG IMPACTENVIRONMENTAL
SOCIAL

GOVERNANCE
APPENDIXESG Data

GRI Contents Index
SASB Index
TCFD Index

Third-party Verification
Statement
GHG Verification
Statement

Association Memberships
and Awards Achievements

GRI Contents Index
Disclosure

GRI 201: Economic Performance 2016
201-1

201-2

201-3
201-4

Direct economic value generated and distributed

38

Financial assistance received from government

84

Defined benefit plan obligations and other retirement plans

202-1

Ratios of standard entry level wage by gender compared to local minimum wage

Proportion of senior management hired from the local community

GRI 203: Indirect Economic Impacts 2016
203-1

203-2

Infrastructure investments and services supported

Significant indirect economic impacts

GRI 204: Procurement Practicies 2016
204-1

Proportion of spending on local suppliers

GRI 205: Anti-corruption 2016
205-1

205-2

205-3

Operations assessed for risks related to corruption

Communication and training about anti-corruption policies and procedures

Confirmed incidents of corruption and actions taken

GRI 206: Anti-competitive Behavior 2016
206-1

-

Disclosed in the Business Report

84

86

68

51, 68, 84

-

78

78-79
85

Legal actions for anti-competitive behavior, anti-trust, and monopoly practices-

Disclosed in the Business Report (sanctions)207-1

Approach to tax-[Not Applicable] No tax policy

207-3

Stakeholder engagement and management of concerns related to tax-[Not Applicable] No tax policy

GRI 207: Tax 2019
207-2
207-4
2023 PAN OCEAN ESG REPORT

Explanation

84

Financial implications and other risks and opportunities due to climate change

GRI 202: Market Presence 2016
202-2

LocationTax governance, control, and risk management
Country-by-country reporting-[Not Applicable] No tax policy[Information Unavailable] Not disclosed

98
OVERVIEWESG IMPACTENVIRONMENTAL
SOCIAL

GOVERNANCEGRI Contents Index
Disclosure

GRI 301: Materials 2016

Materials used by weight or volume-[Not applicable] given the type of business

301-3

Reclaimed products and their packaging materials-[Not applicable] given the type of business

301-2

GRI 302: Energy 2016

ESG Data

302-2

SASB Index
TCFD Index

Third-party Verification
Statement
GHG Verification
Statement

Association Memberships
and Awards Achievements

Recycled input materials used

-

302-1

Energy consumption within the organization

87

302-3

Energy intensity

87

302-5

Reductions in energy requirements of products and services

302-4

Energy consumption outside of the organization
Reduction of energy consumption

GRI 303: Water and Effluents 2016

-

87
-

303-1

Interactions with water as a shared resource

31

303-3

Water withdrawal

88

303-5

Water consumption

-

303-2
303-4

Management of water discharge-related impacts
Water discharge

GRI 304: Biodiversity 2016

[Information Unavailable] given the type of business

304-3

Habitats protected or restored

31

IUCN Red List species and National Conservation List species with habitats in areas affected by operations[Not Applicable] given the type of business

-

31

304-4

[Information Unavailable] No consumption outside of the organization[Information Unavailable] given the type of business

Operational sites owned, leased, managed in, or adjacent to, protected areas and areas of high biodiversity value outside protected areas
Significant impacts of activities, products, and services on biodiversity[Not applicable] given the type of business

-

304-1

304-2

2023 PAN OCEAN ESG REPORT

Explanation

301-1

APPENDIXGRI Contents Index

Location31
31[Information Unavailable] given the type of business

99
OVERVIEWESG IMPACTENVIRONMENTAL
SOCIAL

GOVERNANCE
APPENDIXESG Data

GRI Contents Index
SASB Index
TCFD Index

Third-party Verification
Statement
GHG Verification
Statement

Association Memberships
and Awards Achievements

GRI Contents Index
Disclosure

GRI 305: Emissions 2016
305-1

305-2

305-3

305-4

305-5

305-6
305-7

GRI 306: Waste 2020
306-1

306-2

306-3

306-4

306-5

Direct (Scope 1) GHG emissions

Indirect (Scope 2) GHG emissions

Other indirect (Scope 3) GHG emissions

GHG emissions intensity

308-1

2023 PAN OCEAN ESG REPORT

87

87
87

87

Nitrogen oxides (NOx), sulfur oxides (SOx), and other significant air emissions

88

Emissions of ozone-depleting substances (ODS)

Waste generation and significant waste-related impacts

Management of significant waste-related impacts

Waste generated

Waste diverted from disposal

Waste directed to disposal

New suppliers that were screened using environmental criteria

Negative environmental impacts in the supply chain and actions taken

Explanation

87

Reduction of GHG emissions

GRI 308: Supplier Environmental Assessment 2016308-2

Location-[Information Unavailable] No ODS Emissions

30
30
88

88
-

66

66

[Information Unavailable] Unable to verify vessel waste disposal after landing; treatmentcommissioned to general waste recycling services

100
OVERVIEWESG IMPACTENVIRONMENTAL
SOCIAL

GOVERNANCE
APPENDIXESG Data

GRI Contents Index
SASB Index
TCFD Index

Third-party Verification
Statement
GHG Verification
Statement

Association Memberships
and Awards Achievements

GRI Contents Index
Disclosure

GRI 401: Employment 2016
401-1

New employee hires and employee turnover

90

401-3

Parental leave

93

401-2

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

GRI 402: Labor/Management Relations 2016
402-1

Minimum notice periods regarding operational changes

GRI 403: Occupational Health and Safety 201856

Occupational health and safety management system

57

403-3

Occupational health services

58

403-2
403-4
403-5
403-6
403-7
403-8
403-10

Hazard identification, risk assessment, and incident investigation
Worker participation, consultation, and communication on occupational health and safety
Worker training on occupational health and safety
Promotion of worker healthPrevention and mitigation of occupational health and safety impacts directly linked by business relationships
Workers subject to an occupational health and safety management system
Work-related injuries
Work-related illness

GRI 404: Training and Education 2016

60
58

58-60
59-63
57
94
-

Average hours of training per year per employee

91

404-3

Percentage of employees receiving regular performance and career development reviews

93

Programs for upgrading employee skills and transition assistance programs

GRI 405: Diversity and Equal Opportunity 2016
405-1
405-2

Diversity of governance bodies and employees

Ratio of basic salary and remuneration of women to men

Communicating through Labor-Management Council

62

404-1
404-2

Explanation

53

403-1

403-9

2023 PAN OCEAN ESG REPORT

Location

48-49

92
84

[Information Unavailable] None reported

101
OVERVIEWESG IMPACTENVIRONMENTAL
SOCIAL

GOVERNANCE
APPENDIXESG Data

GRI Contents Index
SASB Index
TCFD Index

Third-party Verification
Statement
GHG Verification
Statement

Association Memberships
and Awards Achievements

GRI Contents Index
Disclosure

GRI 406: Non-Discrimination 2016

Explanation

406-1

Incidents of discrimination and corrective actions taken

44

407-1

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

-

None

408-1

Operations and suppliers at significant risk for incidents of child labor

43-44

-

409-1

Operations and suppliers at significant risk for incidents of forced or compulsory labor

43-44

-

410-1

Security personnel trained in human rights policies and/or procedures

44, 91

Human rights education for all employees regularly

411-1

Incidents of violations involving rights of indigenous peoples-[Information Unavailable] None

413-1

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

67-68

GRI 407: Freedon of Association and Collective Bargaining 2016
GRI 408: Child Labor 2016

GRI 409: Forced or Compulsory Labor 2016
GRI 410: Security Practices 2016

GRI 411: Rights of Indigenous People 2016
GRI 413: Local Communities 2016413-2

Operations with significant actual and potential negative impacts on local communities

GRI 414: Supplier Social Assessment 2016
414-1
414-2

New suppliers that were screened using social criteria

Negative social impacts in the supply chain and actions taken

GRI 415: Public Policy 2016

31
66
66

415-1

Political contributions-

No political contributions

416-1

Assessment of the health and safety impacts of product and service categories-[Not Applicable] No assessment

GRI 416: Customer Health and Safety
416-2

Incidents of non-compliance concerning the health and safety impacts of products and ervices

GRI 417: Marketing and Labeling 2016

-

None

417-1

Requirements for product and service information and labeling-[Not applicable] given the type of business

417-3

Incidents of non-compliance concerning marketing communications

-

None

417-2

Incidents of non-compliance concerning product and service information and labeling

GRI 418: Customer Privacy 2016418-1
2023 PAN OCEAN ESG REPORT

Location

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

92

[Not applicable] given the type of business

102
OVERVIEWESG IMPACTENVIRONMENTAL
SOCIAL

GOVERNANCE
APPENDIXSASB Index
Sustainability Disclosure Topics & Accounting Metrics
TOPIC

Greenhouse Gas
EmissionsESG Data

SASB Index

Third-party Verification
Statement

Air Quality

GHG Verification
Statement

Association Memberships
and Awards Achievements

CATEGORY UNIT OF MEASURE

CODE

Pan Ocean (2022)

Discussion of long-term and short-term strategy or plan to manage Scope 1 emissions, emissions
reduction targets, and an analysis of performance against those targets

Discussion
and Analysis

N/A

TR-MT-110a.2(p31-34)(2) percentage heavy fuel oil

Quantitative%

TR-MT-110a.3

390,570 TOE (HFO, 46%)

Average Energy Efficiency Design Index (EEDI) for new ships

Quantitative Grams of CO2₂ per tonnautical mile

TR-MT-110a.4

Confidential(2) SOx, andQuantitative Metric tons (t)TR-MT-120a.1

8,382

Shipping duration in marine protected areas or areas of protected conservation status

Quantitative

TR-MT-160a.1(1) Number and (2) aggregate volume of spills and releases to the environment

Quantitative (1) Number (2) m³

TR-MT-160a.3

Lost time incident rate (LTIR*)

Quantitative Rate

TR-MT-320a.1

Number of calls at ports in countries that have the 20 lowest rankings in Transparency International’s
Corruption Perception Index

Onshore: 0
Offshore: 4.63

Quantitative Number

TR-MT-510a.1

0Number of marine casualties, percentage classified as very serious*

Quantitative Number,
Percentage (%), People

TR-MT-540a.1

Number of Conditions of Class or Recommendations

Quantitative Number

TR-MT-540a.2

Accident: 0
Accident ratio: 0%
Casualties: 0(1) Total energy consumed(3) percentage renewable

GRI Contents Index
TCFD Index

ACCOUNTING METRIC

Gross global Scope 1 emissions

Ecological Impacts

Employee Health &SafetyBusiness Ethics

Accident & Safety
Management(1) NOx (excluding N2O)

(3) particulate matter (PM10)

Percentage of fleet implementing ballast water (1) exchange and (2) treatment

Total amount of monetary losses as a result of legal proceedings associated with bribery or corruption

Number of port state control(PSC**) (1) deficiencies and (2) detentions

Quantitative Metric tons (t) CO2-e

Quantitative

TOE%

Number of travel days%

Quantitative Reporting currency

Quantitative Number* LTIR: (lost time incidents) / (1,000,000 hours worked)** including marine hazards associated with death or serious injury, disappearance, complete loss/significant damage to the vessel, and serious environmental damage*** PSC: A system in which a port country checks whether foreign ships entering its port do not meet the safety standards prescribed by international agreements and takes necessary measures, such as detentions, for ships with defects
2023 PAN OCEAN ESG REPORT

TR-MT-110a.1

TR-MT-160a.2

TR-MT-510a.2

TR-MT-540a.3

2,669,080

848,790 TOE (Scope 1+2)
No renewable energy
consumed

71,2495,317

Uncountable(1) 8%(2) 92%(1) None(2) None

030(1) 239(2) 4

103
OVERVIEWESG IMPACTENVIRONMENTAL
SOCIAL

GOVERNANCE
APPENDIXESG Data

GRI Contents Index
SASB Index
TCFD Index

Third-party Verification
Statement
GHG Verification
Statement

Association Memberships
and Awards Achievements

2023 PAN OCEAN ESG REPORTSASB Index
Activity Metrics
ACTIVITY METRIC

Number of shipboard employees

Total distance traveled by vessels

Operating days

Deadweight tonnage

Number of vessels in total shipping fleet

Number of vessel port calls

Twenty-foot equivalent unit (TEU) capacity

CATEGORY

Quantitative

Quantitative

Quantitative

Quantitative

Quantitative

Quantitative

Quantitative

UNIT OF MEASURE

CODE

Number

TR-MT-000.A

Days

TR-MT-000.C

Nautical miles (nm)Thousand deadweight tons

NumberNumberTEU

TR-MT-000.B

TR-MT-000.D(Based on owned vessels)

Pan Ocean (2022)

775

6,650,416

40,453

13,128.771

TR-MT-000.E

110

TR-MT-000.G

6,041

TR-MT-000.F

3,281

104

TCFD Index

OVERVIEWESG IMPACTENVIRONMENTAL
SOCIAL

GOVERNANCE
APPENDIX

Category
Governance

Strategy

ESG Data

GRI Contents Index
SASB Index

TCFD Index

Third-party Verification
Statement
GHG Verification
Statement

Association Memberships
and Awards Achievements

2023 PAN OCEAN ESG REPORT

Risk Management

Metrics & Targets

Recommendation Disclosures

Page

b. Describe management’s role in assessing and managing climate-related risks and opportunities

37

a. Describe the board’s oversight of climate-related risks and opportunities

a. Describe the climate-related risks and opportunities the organization has identified over the short, medium, and long term perspective
b. Describe the impact of climate-related risks and opportunities on the organization’s businesses, strategy, and financial planningc. Describe the resilience of the organization’s strategy, taking different climate-related scenarios, including a 2°C or lower scenario into consideration
a. Describe the organization’s processes for identifying and assessing climate-related risks
b. Describe the organization’s processes for managing climate-related risks

c. Describe how processes for identifying, assessing, and managing climate-related risks are integrated into the organization’s overall risk management
a. Disclose the metrics used by the organization to assess climate-related risks and opportunities in line with its strategy and risk management process
b. Disclose Scope 1, Scope 2 and, if appropriate, Scope 3 greenhouse gas (GHG) emissions and the related risks

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

37
38
38
38
37
37
37

28, 39-41, 87
41, 8728, 39-41

105
OVERVIEWESG IMPACTENVIRONMENTAL
SOCIAL

GOVERNANCE
APPENDIXESG Data

GRI Contents Index
SASB Index
TCFD Index

Third-party Verification
Statement
GHG Verification
Statement

Association Memberships
and Awards Achievements

Third-party Verification Statement
Independent Assurance Statement
To readers of Pan Ocean 2023 ESG Report
Introduction

Limitations and Recommendations“Report”). The data and its presentation in the Report is the sole responsibility of the management of Pan Ocean. KMR’s responsibility isprovided in good faith. Limited depth of evidence gathering including inquiry and analytical procedures and limited sampling at lower levels

Korea Management Registrar (KMR) was commissioned by Pan Ocean to conduct an independent assurance of its 2023 ESG Report (theto perform an assurance engagement as agreed upon in our agreement with Pan Ocean and issue an assurance statement.

Scope and Standards

Pan Ocean described its sustainability performance and activities in the Report. Our Assurance Team carried out an assurance engagementin accordance with the AA1000AS v3 and KMR’s assurance standard SRV1000. We are providing a Type 1, moderate level assurance. We
evaluated the adherence to the AA1000AP (2018) principles of inclusivity, materiality, responsiveness and impact provided using the Global

Reporting Initiative (GRI) Index provided below. The opinion expressed in the Assurance Statement has been formed at the materiality of theprofessional judgment of our Assurance Team.

Confirmation that the Report was prepared in accordance with GRI standards 2021 was included in the scope of the assurance. We havereviewed the topic-specific disclosures of standards which were identified in the materiality assessment process. .
｜GRI Sustainability Reporting Standards 2021
｜Universal standards｜Topic specific standards

ㆍGRI 205: Anti-Corruption
ㆍGRI 302: Energy

ㆍGRI 305: Emissions

ㆍGRI 401: Employment

ㆍGRI 403: Occupational Health and Safety
ㆍGRI 404: Training and Education

ㆍGRI 405: Diversity and Equal Opportunity
ㆍGRI 406: Non-discrimination

ㆍGRI 407: Freedom of Association and Collective Bargain
ㆍGRI 408: Child LaborㆍGRI 409: Forced or Compulsory LaborㆍGRI 411: Rights of Indigenous Peoples

As for the reporting boundary, the engagement excludes the data and information of Pan Ocean’ partners, suppliers and any third parties.

KMR's Approach

KMR’s assurance engagement is based on the assumption that the data and information provided by Pan Ocean to us as part of our review arein the organization were applied. To address this, we referred to independent external sources such as DART and National Greenhouse Gas
Management System (NGMS) and public databases to challenge the quality and reliability of the information provided.

Conclusion and Opinion

Based on the document reviews and interviews, we had several discussions with Pan Ocean on the revision of the Report. We reviewed
the Report’s final version in order to make sure that our recommendations for improvement and revision have been reflected. Basedon the work performed, it is our opinion that the Report applied the GRI Standards. Nothing comes to our attention to suggest that theReport was not prepared in accordance with the AA1000AP (2018) principles.
｜Inclusivity｜

Pan Ocean has developed and maintained different stakeholder communication channels at all levels to announce and fulfill its
responsibilities to the stakeholders. Nothing comes to our attention to suggest that there is a key stakeholder group left out in theprocess. The organization makes efforts to properly reflect opinions and expectations into its strategies.

｜Materiality｜

Pan Ocean has a unique materiality assessment process to decide the impact of issues identified on its sustainability performance. We
have not found any material topics left out in the process.

｜Responsiveness｜

Pan Ocean prioritized material issues to provide a comprehensive, balanced report of performance, responses, and future plans re-garding them. We did not find anything to suggest that data and information disclosed in the Report do not give a fair representationof Pan Ocean’ actions.

｜Impact｜

Pan Ocean identifies and monitors the direct and indirect impacts of material topics found through the materiality assessment, andquantifies such impacts as much as possible.

Competence and Independence

KMR maintains a comprehensive system of quality control including documented policies and procedures in accordance with ISO/IEC
17021ㆍ2015 - Requirements for bodies providing audit and certification of management systems. This engagement was carried out by anindependent team of sustainability assurance professionals. KMR has no other contract with Pan Ocean and did not provide any services to
Pan Ocean that could compromise the independence of our work.

To perform an assurance engagement within an agreed scope of assessment using the standards outlined above,our Assurance Team un-

June 2023 Seoul, Korea

dertook the following activities as part of the engagement:｜reviewed the overall Report;｜reviewed materiality assessment methodology and the assessment report;｜evaluated sustainability strategies, performance data management system, and processes;｜interviewed people in charge of preparing the Report;｜reviewed the reliability of the Report's performance data and conducted data sampling;｜assessed the reliability of information using independent external sources such as Financial Supervisory Service’s DART and public

2023 PAN OCEAN ESG REPORT

databases.

CEO

106

GHG Verification Statement

OVERVIEW

ESG IMPACTENVIRONMENTAL

DNV BUSINESS ASSURANCE온실가스 배출량 검증 성명서

SOCIAL

GOVERNANCE
APPENDIXDNV BUSINESS ASSURANCEVERIFICATION STATEMENTGREENHOUSE GAS (GHG) EMISSIONS

팬오션㈜G

No.: AS_ PRJN-529649-2023-AST-KOR

서문

No.:AS_ PRJN-529649-2023-AST-KOR㈜디엔브이비즈니스어슈어런스코리아(이하, DNV)는 팬오션㈜(이하, 팬오션’)의 2022 년도 온실가스 배출량에 대해 제한적 보증

ESG Data수준 하에서 검증을 수행하였습니다. 팬오션은 ‘ISO 14064-1:2018(온실가스-제 1 부: 온실가스 배출 및 제거의 정량 및 보고를 위한

SASB Index조건에 따라 검증 계약당사자를 제외한 제 3 자에 대하여 어떠한 책임도 지지 않습니다.

Third-party Verification
Statement본 검증에서 다루어진 온실가스 배출량은 재무통제기준에 따라 설정된 팬오션의 조직경계 내에서 수집된 활동데이터를 바탕으로산정되었으며, 직접 배출(Scope 1 배출), 에너지 간접배출(Scope 2 배출)과 기타간접배출(Scope 3 배출)을 포함하고 있습니다.
• 조직경계: 팬오션 국내사업장 – 본사(서울), 부산사무소, 포항사무소, 광양사무소
• 운영경계: 직접배출(Scope 1), 간접배출(Scope 2), 기타간접배출(Scope 3)

GRI Contents Index
TCFD Index

GHG Verification
Statement

Association Memberships
and Awards Achievements조직 차원의 사용 규칙 및 지침)’, ‘WRI/ WBCSD GHG Protocol: A Corporate Accounting and Reporting Standard’ 및 ‘IPCC
Guidelines:2006’에 명시된 원칙에 근거한 온실가스 배출량 자료를 준비할 책임이 있으며, DNV 는 본 검증성명서와 관련하여 계약검증 범 위검증 방 식본 검증은 2023 년 4 월 12 일부터 6 월 7 일까지의 기간 동안 ‘ISO 14064-3:2019(온실가스-제 3 부:온실가스 성명서에 대한 타당성평가 및 검증을 위한 사용 규칙 및 지침)’의 검증 원칙과 기준에 따라 수행되었습니다. DNV 는 팬오션이 보고한 온실가스 배출량과온실가스 인벤토리의 완성에 대한 검증 의견을 제시하는데 필요한 정보와 데이터를 얻기 위하여 검증 계획을 수립하고, 검증을실시하였습니다. 검증 절차의 부분으로 다음 사항을 확인하였습니다.
• 팬오션의 2022 년 온실가스 배출량 보고서(엑셀 산정 툴)• 팬오션의 온실가스 데이터 관리 및 수집, 배출량 산정 및 보고 프로세스결론상기와 같이 수행된 프로세스와 절차에 따라, 온실가스 배출량 선언과 관련한 데이터 및 정보가 상기 기준의 적용 측면에서부적절하다는 점은 발견하지 못하였습니다. 팬오션의 2022 년 온실가스 배출량은 아래와 같이 확인되었습니다.

팬오션의 2022 년 온실가스 배출량
YWYYG
팬오션

직접배출(Scope1)

선 박G

차 량G

2,669,026

54

전 기G

기타간접배출
(Scope3)*총배출량(Scope1,2,3)

483

3,738,975

6,408,538

DNV Business Assurance Korea Ltd. (“DNV”) was commissioned by Ocean Co., Ltd. (“Pan Ocean”) to verify the Pan Ocean’s Greenhouse Gas
Inventory for the calendar year 2022, based upon a limited level of assurance. Pan Ocean is responsible for the preparation of the GHG emissions
data on the basis set out within the ‘ISO 14064-1:2018 (Greenhouse gases - Part 1: Specification with guidance at the organization level for
quantification and reporting of greenhouse gas emissions and removals)’, ‘WRI/WBCSD GHG Protocol’, and ‘2006 IPCC Guidelines for National
Greenhouse Gas Inventories’. Our responsibility in performing this work is to the management of Pan Ocean only and in accordance with termsof reference agreed with them. DNV expressly disclaims any liability or responsibility for any decisions, whether investment or otherwise, based
upon this assurance statement.

Scope of Assurance
The emissions data covered by our examination comprise Direct emissions (Scope 1 emissions), Indirect emissions (Scope 2 emissions) and Other
indirect emissions (Scope 3) within the Pan Ocean’s domestic business sites;•
Organizational boundary: Pan Ocean’sdomestic business sites (Headquarters (Seoul), Busan Office, Pohang Office, Gwangyang
Office)•Operational boundary: Direct emissions (Scope 1), Indirect emissions (Scope 2) and Other indirect emissions (Scope 3)

Verification Approach
The verification has been conducted by DNV from April 12th through June 7th, 2023 and performed in accordance with the verification principles
and tasks outlined in the ‘the ‘ISO 14064-3:2019 (Greenhouse gases - Part 3: Specification with guidance for the validation and verification ofgreenhouse gas assertions)’. We planned and performed our work to obtain all the information and explanations deemed necessary to provide us
with sufficient evidence to provide a verification opinion, concerning the reported emission figures in ton CO2 equivalent. As part of the verification
process;•
We have reviewed and verified the Pan Ocean’s GHG Inventory Tool (Excel based)•
We have reviewed and verified the process to generate, aggregate and report the emissions data

Conclusions
Based on the process and procedures conducted, there is no evidence that the GHG assertion is not materially correct and is not a fair representationof GHG data and information, and has not been prepared in accordance with a related standard on GHG quantification, monitoring and reporting
The GHG Emissions of Pan Ocean for the year 2022 were confirmed as below;

Greenhouse Gas Emissions of Pan Ocean for Yr 2022

2022
Pan Ocean이장섭대표이사㈜디엔브이비즈니스어슈어런스코리아

본G외부G검증인의G검증성명서는G성명서G발행일GOYWYZ 년G] 월 ` 일PG현재로G유효한G것입니다UGG성명서G발행일G이후G본G성명서를G열람하는G시점G사이에SG온실가스G배출량G산정에G중요한G영향을G미칠G수G있는G사건이나G상황이G발생할G수G있으며SG이로G인하여G본G검증성명서가G수정될G수도G있습니다U

2023 PAN OCEAN ESG REPORT

Introduction(단위: ton CO2eq)

간접배출(Scope2)※상기의 온실가스 배출량은 정수로 보고하기 위한 반올림처리로 인해 ± 1 tCO2eq 미만의 차이가 발생할 수 있음*기타간접배출(Scope3): 구매한 제품 및 서비스, 업스트림 임차자산, 업스트림 물류, 출장, 통근

2023 년 6 월 9 일대한민국, 서울PAN OCEAN CO., LTD.



Direct emissions (Scope1)

Indirect emissions(Scope2)

VesselVehicleElectricity

2,669,026

54

483

Unit: ton CO2 equivalent.

Other indirect emissions(Scope 3)*

Total emissions

3,738,975

6,408,538※ In order to report the GHG emissions as an integer, the rounded number on the statement might be different from the number on the system with ± 1 tCO2 eq* Other indirect emissions (Scope3) reported: Purchased goods & services, Upstream leased assets, Upstream transportation and distribution, Business travel, Employee
commuting

9th June 2023
Seoul, Korea

Jang-Sub Lee
Country Manager
DNV Business Assurance Korea Ltd

This Verification Statement is valid as of the date of the issuance 9th June 2023. Please note that this Verification statement would be revised if any material discrepancy which may impact
on the Greenhouse Gas Emissions of organization is subsequently brought to our attention. In the event of ambiguity or contradiction in this statement between English version and Korean
version, Korean shall be given precedent.

107
OVERVIEWESG IMPACTENVIRONMENTAL
SOCIAL

GOVERNANCE
APPENDIXESG Data

GRI Contents Index
SASB Index
TCFD Index

Third-party Verification
Statement
GHG Verification
Statement

Association Memberships
and Awards Achievements

2023 PAN OCEAN ESG REPORT

Association Memberships and Awards Achievements
Membership
PeopleSeoul Chamber of Commerce and Industry
Korea Industry Associations Council

Korea Listed Companies Association
Korea Enterprises Federation

Korea Shipowners’ Association

Korea International Trade Association
Yellow Sea Liners Committee

Korea Near-Sea Freight Conference
Korea AEO Association

Korea Ship Managers Association
Korea Gas Union

Society of International Gas Tanker and Terminal Operators
Korea Emergency Planning Officers Council

Achievements
YearAwardsOrganizer

2022 12th AEO Case Sharing Competition(AEO Best Practice Competition)

2022.12.13

2022 Good Relationship Sponsorship Category Jongno District
Member of National Assembly Award

Korea Customs
Service2023.06.29

One hundred Million Tonnage Shipping' Award

Ministry of Oceans
and Fisheries

2022.12.07

Seoul SeniorWelfare Center

｜Publication Date June 2023 ｜ Publisher Ahn Joong Ho ｜ Published by Planning Department Business Management Team2023 ESG Report