Lotte Insurance, Establishing 'Board-Centered Management'..."Strengthening Outside Directors' Capabilities and Support"

Guaranteeing Board Independence
Continuous Operation of Training Sessions to Enhance Expertise

[Asia Economy Reporter Ki Ha-young] Lotte Insurance announced on the 15th that it is striving to establish 'board-centered management' by strengthening the capabilities and support of outside directors.

In the midst of a paradigm shift in management toward ESG (Environment, Social, Governance), it is explained that the company is practicing board-centered management to advance governance, making the board of directors the highest decision-making body.

First, after the change of major shareholders, Lotte Insurance composed 3 out of 5 board members as independent outside directors in accordance with related laws. The chairperson of the board is assigned to an outside director, and by holding meetings at least once a month, the board has become the company's actual highest decision-making body. In particular, all subcommittees within the board are composed solely of outside directors to ensure that substantive decision-making is based on independence and expertise.

Additionally, to strengthen the expertise of board members in line with changes in the insurance and financial environment, the board is composed of Korea's top financial experts, and continuous educational sessions on various topics such as IFRS17 and the new solvency regime (K-ICS) are provided for outside directors. Four training sessions were held last year, and various sessions are planned for this year as well. Furthermore, financial support such as research and education expenses for outside directors, the establishment of a hotline, and dedicated office space are being prepared to support thorough board activities.

As a result of these efforts, Lotte Insurance received an A grade (7th to 2nd place within the industry) in the governance category of the '2020 ESG Evaluation' announced by the Korea Corporate Governance Service (KCGS), an improvement from the previous year's B+.

A representative of Lotte Insurance stated, "We will maximize the fusion of expertise between the company and the board and complement any shortcomings to efficiently resolve various challenges and tasks the company faces. We will strive to become a company with the best governance in Korea so that the achievements can be fully reflected in the company and all shareholders."

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