Kakao Junshinwi Launches 6 Months Ago... "No Reckless IPOs"

Kakao Compliance and Trust Committee First Workshop
Presentation of Improvement Plans on Responsible Management and Trust Restoration

The Kakao Compliance and Trust Committee (hereinafter referred to as the Compliance Committee), an independent body supporting compliance and trust management of Kakao affiliates, announced on the 11th that it held its first workshop at the 'Kakao AI Campus' located in Yongin, Gyeonggi Province.

This workshop marked six months since the launch of the Compliance Committee and was held to review the current status of Kakao's compliance and discuss future committee activities. About 30 participants, including committee members, expert advisors, the secretariat, and Kakao officials, attended.

At the event, Kakao announced improvement plans on three agendas: 'Responsible Management,' 'Ethical Leadership,' and 'Restoration of Social Trust.' This followed the Compliance Committee's recommendation in February to prepare improvement plans for Kakao's sustainable growth based on these three agendas.

The Kakao Compliance and Trust Committee held its first workshop at the 'Kakao AI Campus' located in Yongin, Gyeonggi Province.
[Photo by Kakao Compliance and Trust Committee]

To establish the foundation for the first agenda, 'Responsible Management,' Kakao emphasized establishing a control tower structure centered on the CA Council and pledged to pursue management reform under the leadership of Kim Beom-su, chairman of the CA Council. Additionally, Kakao plans to strengthen pre-risk assessments and post-monitoring systems for decision-making with significant social impact, such as large-scale investments. To reinforce management accountability, Kakao will enhance appointment and dismissal processes, including internal and external reputation verification, and consider imposing compensation liability on executives who intentionally commit illegal acts.

For the second agenda, 'Establishing Ethical Leadership,' Kakao plans to prepare the 'Kakao Group Code of Ethics,' which includes four elements: values, fairness, communication, and responsibility, and publicly announce it so that all Kakao employees, including executives, can comply.

Lastly, to implement the 'Restoration of Social Trust' agenda, Kakao will promote shareholder value protection and partner coexistence measures. Regarding shareholder value protection, Kakao established a principle to refrain from indiscriminate new initial public offerings (IPOs) to prevent concerns about the decline in parent company shareholder value due to subsidiary listings. Accordingly, when pursuing IPOs in the future, a thorough pre-verification process will be conducted at the group level. Even if an IPO is decided, shareholder value protection measures will be prepared and applied together. To foster coexistence with partners, Kakao announced plans to prepare a comprehensive group-level roadmap to systematically support coexistence projects.

The Compliance Committee plans to review the detailed contents and implementation plans of the improvement measures and then conduct a thorough evaluation period. Subsequently, it will support six affiliated companies under agreement?Kakao, Kakao Games, Kakao Mobility, Kakao Bank, Kakao Entertainment, and Kakao Pay?to faithfully execute the improvement plans.

Meanwhile, at the workshop, Professor Heo Seong-wook of Seoul National University Law School gave a lecture on 'ESG and Compliance Trends.' Participants discussed exemplary cases where compliance systems have been established and ways to apply them to Kakao.

In this regard, the Compliance Committee recently commissioned a research project to establish compliance management systems and evaluation criteria suited to the characteristics of platform industries such as Kakao. Based on this, it plans to study ways for Kakao to lead compliance and trust management going forward.

Kim So-young, chairperson of the Compliance Committee, said, "From now on, it is time for the committee and Kakao to thoroughly review and properly implement the improvement plans." She added, "Going forward, the committee will carefully monitor and support Kakao to ensure that the promised improvement plans are concretely realized and well maintained."

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