Enchem Declares Emergency Management: "Restoring Trust Is Top Priority, Management System to Be Reexamined from the Ground Up"

Official Apology for Market Turmoil Following Accounting Issue
Declaration of Comprehensive Overhaul in Transparent Management and Internal Controls
Immediate Risk Mitigation and Enhanced Shareholder Protection

Enchem has once again apologized for the temporary trading suspension that occurred during its accounting restatement process, which caused increased market confusion, and has immediately activated a company-wide emergency management system. On November 25, the company announced that it considers this incident a critical management issue, with restoring trust as its top priority, and stated its intention to re-examine its internal controls, corporate governance, and financial management systems from the ground up.

Exterior view of Enchem's factory in Georgia, USA. Enchem

Previously, on November 14 at approximately 5:00 p.m., the Korea Exchange announced that “it has been confirmed that Enchem’s third-quarter revenue was less than 300 million won in its quarterly report,” and disclosed that grounds for a substantive review of listing eligibility had arisen. Shortly thereafter, it announced that trading of Enchem shares would be suspended until a decision was made regarding the eligibility review. In response, Enchem submitted verification documents from an external auditor regarding its quarterly revenue to the exchange, and at around 8:20 p.m. the same day, the grounds for the review were resolved, and the trading suspension was lifted.

Enchem explained, “This accounting restatement was due to a structural change in accounting treatment, not poor business performance,” adding, “We recognize our responsibility for the market confusion and will immediately implement measures such as re-verifying internal transactions and financial reporting processes, standardizing accounting policies among subsidiaries, introducing a recurrence prevention program with external experts, and expanding the disclosure of IR information.”

Enchem will reorganize its organizational structure and decision-making system to focus on efficiency and transparency. The restructuring of corporate governance will center on strengthening audit and internal control functions, mandating prior verification of major decisions, unifying accounting standards across domestic and overseas subsidiaries, reinforcing the review of internal transactions, and establishing processes to preemptively block financial and accounting risks.

Additionally, Enchem will pursue personnel renewal to restore organizational trust. The company will overhaul its management division, reallocate authority, reposition leadership, and rebuild a performance- and accountability-oriented organizational culture, comprehensively restructuring its organization, leadership, and processes. Enchem clarified its principle of assigning personnel with appropriate qualifications to positions of responsibility.

An Enchem representative stated, “We define this emergency management system not as a short-term response, but as the starting point for a fundamental transformation of our management practices, with restoring shareholder value as our highest priority,” adding, “The company will work to regain trust through performance improvement and structural reform.”

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