POSCO Implements ESG Management from the Purchasing Stage

Establishing a Group-Level 'POSCO-Style ESG Procurement System'
Doubling Eco-Friendly Procurement Amounts by 2025

[Asia Economy Reporter Hwang Yoon-joo] POSCO, the first domestic company to introduce the Benefit Sharing system and present a standard model for win-win growth between large and small-to-medium enterprises, is also leading supply chain management from an ESG (Environmental, Social, Governance) perspective.

Based on the company's management philosophy of Corporate Citizenship's five major brands, 'Together With POSCO' (win-win growth) and 'Green With POSCO' (carbon neutrality), POSCO has established a group-wide 'POSCO-style ESG Purchasing System' under the purchasing policy of 'leading sustainable purchasing by fundamentally buying from environmentally friendly and socially responsible suppliers.'

To this end, POSCO plans to carry out activities to establish ESG management throughout the supply chain, including raw materials, equipment, and materials, through ▲ selecting suppliers from an ESG perspective ▲ expanding eco-friendly purchasing ▲ supporting suppliers' ESG establishment activities.

First, POSCO grants entry qualifications to new prospective suppliers by screening basic ESG qualifications such as compliance with environmental and human rights-related laws and regulations and ethical management. For existing suppliers, POSCO strengthens evaluations of environmental certifications and ESG-related activities, encouraging improvements if ESG evaluations fall short, and restricting supply if improvements are not made.

Additionally, POSCO plans to double eco-friendly purchasing to $2 billion by 2025 by expanding recycling of waste resources such as scrap (Recycle), purchasing energy-efficient and eco-friendly certified products to reduce greenhouse gases and air pollution (Reduce), and minimizing resource waste through material reuse (Reuse) based on the 3R principles. This will contribute to the company's goal of achieving '2050 Carbon Neutrality.'

Furthermore, POSCO will promote ESG establishment support activities targeting small and medium suppliers who still have low understanding of ESG and lack internal capabilities. Since last month on the 29th, POSCO has been operating educational courses for suppliers on understanding ESG and ESG purchasing policies. The 'Supplier Code of Conduct,' which stipulates basic requirements suppliers must follow, has also been revised to include ESG compliance items. Through the operation of the 'Win-Win Growth Support Group' and the 'Eco-Friendly Consulting Support Group,' POSCO is supporting improvements on ESG-related issues faced by suppliers. Moreover, POSCO has established a 'Responsible Minerals Policy' to identify minerals that cause human rights, conflict, and environmental issues and exclude them from purchasing, and plans to strengthen management to ensure suppliers comply with responsible mineral purchasing processes.

POSCO also regularly holds the 'Group ESG Purchasing Council' with group companies to share best practices in ESG purchasing, with the policy that group companies will expand ESG purchasing to the same level as POSCO.

Meanwhile, POSCO plans to disclose the performance of the ESG purchasing system operation through the Corporate Citizenship Report and the POSCO electronic purchasing system (steel-n.com).

This content was produced with the assistance of AI translation services.