SK Square

Win-win Management

SK Square strives to enhance the ESG capabilities within the value chain based on a cooperative relationship with our business partners. We have policies and procedures for the sustainable “Win-Win management”.

Supplier Management Policy

In accordance with the sustainability terms of ESG, SK Square has established a supplier management policy. In order to expand ESG management and strengthen the executive capacity of suppliers, we have established and shared the Supplier Code of Conduct.

Bidding Policy
Supplier selection principles, bidding process, detailed guidelines, etc.
General Principles for Purchasing
Compliance with corporate social responsibilities such as shared growth and labor, human rights, anti-corruption, and the environment
Supplier ESG Code of Conduct
Guidelines for business partners’ social responsibility and ethical business management

Supplier ESG Code of Conduct

Bidding Policy	Supplier selection principles, bidding process, detailed guidelines, etc.
General Principles for Purchasing	Compliance with corporate social responsibilities such as shared growth and labor, human rights, anti-corruption, and the environment
Supplier ESG Code of Conduct	Guidelines for business partners’ social responsibility and ethical business management Supplier ESG Code of Conduct

Supplier

ESG Management

SK Square operates an ESG risk management process to systematically manage the sustainability of suppliers. We conduct preliminary screening for all suppliers (new / existing) every year based on the “Supplier ESG Code of Conduct”.

Supplier ESG Risk Management Process

New Supplier Registration - Regi-stration → ESG eligibility screening → Results review → Supplier selection
Supplier ESG Audits - Regular ESG audits conducted on an annual or quarterly basis in accordance with the Supplier ESG Code of Conduct
Post-Registration Management - Focused monitoring and management of high-risk suppliers, including the development and implementation of corrective action plans

Status quo of Supplier ESG Risk Management (Pre-screening process)

Total number of newly registered suppliers
Unit	Company
2022	61
2023	48
2024	4

Number of screening sessions
Unit	Company
2022	61
2023	48
2024	4

Percentage of high-risk suppliers
Unit	%
2022	0
2023	0
2024	0

Percentage of pre-screening completed
Unit	%
2022	100
2023	100
2024	100

Category	Unit	2022	2023	2024
Total number of newly registered suppliers	Company	61	48	4
Number of screening sessions	Company	61	48	4
Percentage of high-risk suppliers	%	0	0	0
Percentage of pre-screening completed	%	100	100	100

Supplier Screening

SK Square operates a supplier screening system that incorporates ESG considerations during the selection of new suppliers and the renewal of existing supplier contracts as part of its efforts to build a sustainable supply chain. SK Square promotes ESG awareness by linking ESG requirements to its Bid Evaluation guideline. Suppliers that do not comply with the ESG Code of Conduct may face disadvantages in procurement, such as lower priority in contract consideration.

Category	Screening Criteria
ESG Factors	Labor & human rights, health & safety, environment, ethics, and management systems
Country Risk	Risks associated with the political, social, economic, and legal environment of the supplier's operating country
Product Risk	Risks that may arise at various stages of product manufacturing, distribution, and use
Industry Risk	Risks inherent to the industry, such as labor conditions, energy consumption, and resource intensity

Category	Screening Criteria
ESG Factors	Labor & human rights, health & safety, environment, ethics, and management systems
Country Risk	Risks associated with the political, social, economic, and legal environment of the supplier's operating country
Product Risk	Risks that may arise at various stages of product manufacturing, distribution, and use
Industry Risk	Risks inherent to the industry, such as labor conditions, energy consumption, and resource intensity

Shared Growth Principles

SK Square promotes sustainable growth with its suppliers through a trading culture based on fairness and trust. SK Square aims for shared growth based on three principles.

Shared Growth Principles: Observance of the Fair Trade Commission’s recommendations to establish a fair trade culture: usage of the Open4U system(SK Square purchasing portal) - Continuous efforts to maintain the fair selection of business partners, promotion of their rights and interests, and the enhancement of our internal self-regulation activities standards; Promotion of the win-win culture by expanding programs and systems related to shared growth; Enhancement of the suppliers’ competitiveness via mutual collaboration and systematic support

Go to Open4U, the SK Square purchasing / shared growth portal

Shared
Growth Support
Program

SK Square operates supplier support programs designed to promote shared growth through close collaboration with its partners. By leveraging its own capabilities, SK Square has developed a range of shared growth initiatives to foster the advancement of its suppliers. In particular, SK Square maintains dedicated communication channels to gather supplier feedback and uses the insights to develop tailored support measures. To alleviate financial burdens on its suppliers, SK Square implements an early payment system under which payments are made in cash within 30 days. In addition, institutional mechanisms have been strengthened to promote fair trade practices throughout the supply chain.

Overview of Shared Growth Programs

Partner communication channel and regular off-line meetings
Program Description	Seeking shared growth by opening regular meetings and communication channels
Unit	Session
2022	-
2023	1
2024	4

Early payment
Program Description	Payment within 30 days to alleviate the burden on suppliers cash liquidity
단위	KRW million
2022	37,576
2023	34,169
2024	40,651

Category	Program Description	Unit	2022	2023	2024
Partner communication channel and regular off-line meetings	Seeking shared growth by opening regular meetings and communication channels	Sessions	-	1	1
Early payment	Payment within 30 days to alleviate the burden on suppliers cash liquidity	KRW million	37,576	34,169	40,651

Sustainability