KUMHO P&B CHEMICALS

SUSTAINABILITY

Environmental Management

Policy and Goal
Stakeholders

Environmental Management Policy

Kumho P&B Chemicals is dedicated to building social trust and contributing to the preservation of our global environment through continuous improvement in environment, safety, health, and energy efficiency under the principles of Responsible Care. We are committed to fulfilling the following actions with sincerity and responsibility:

1. We place top priority on environmental protection, safety, health, and energy efficiency at every stage of product development, design, manufacturing, transportation, and service.
2. We establish clear objectives for managing environment, safety, health, and energy, allocate appropriate resources, and pursue ongoing improvement activities to achieve them.
3. We strive to develop and apply technologies that enable eco-friendly product manufacturing, ensure safe working environments, and promote the well-being of our employees.
4. All applicable laws, regulations, and internal requirements are documented, communicated to all employees, and strictly observed through continuous education and training.
5. We actively communicate and respond to the concerns of our employees, customers, communities, and related organizations regarding environmental, safety, and health matters.
6. We provide customers with sufficient information and guidance on product hazards to ensure safe use, transportation, and disposal.
7. We work closely with stakeholders and partners to develop technologies and implement joint programs that address environmental, safety, and health challenges.
8. Together with our partners, we are committed to achieving zero accidents and zero injuries by fostering mutual trust, respect, and cooperation.
9. The General Plant Manager acts as the management representative for this policy, conducting regular reviews and audits to ensure active participation from all employees.

Goals and Action Plans

Environmental Management Advancement
● Environmental management system execution strengthening
● Minimize environmental impact
● Environmental Compliance Strengthening
Air Pollution Control
● Strengthening target management by 30% compared to legal standards
● Monitoring of air pollution emissions status through TMS and self-measurement
● Minimize odor generation
Hazardous Chemical Management
● Chemical management process in all areas from raw material procurement to disposal
● Efforts are made to minimize environmental impact caused by chemical substances by substituting them with less harmful or less toxic materials
● Operation of internal management processes to comply with the Material Safety Data Sheet system according to industrial safety and health
Wastewater Reduction
● Management of goals below legal standards
● Improvement of operational condition by changing cooling tower chemicals and product additives
● Wastewater reduction by recycling of discharge water
● Investments to facility such as real-time monitoring systems for open ditch
Waste Reduction
● Efforts to minimize waste, including designated waste/general waste/reduction of waste generation per unit
● Continuous study of measures to expand the recycling of major waste
Soil Contamination Management
● Aiming to prevent soil pollution
● Implementation of soil contamination inspection and monitoring through external specialized agencies
● Investment to reduce soil contamination risks caused by chemical spills during emergencies

ENVIRONMENT MANAGEMENT / KUMHO P&B CHEMICALS

KPB maintains relations with diverse groups of stakeholders, including public and governmental authorities, local communities, and other organizations. The main governmental and public stakeholders include the Ministry of Environment, the Provincial Government of Jeollanam-do, the City of Yeosu and Environmental Facility Management Corporation, which oversees wastewater treatment facilities, among others. Nongovernmental stakeholders include the Beautiful Yeosu 21 Steering Committee. The Yeosu National Industrial Cluster and the surrounding local communities are also important stakeholders.
In an effort to maintain good relations with local communities, KPB has established the Yeosu National Industrial Cluster Environmental Council (YICEC), along with other tenant businesses, and has been managing environmental issues actively through the Council. When odor became the most critical environmental issue in and around the Cluster in 2008, KPB reinforced strict control of its raw and intermediary materials, introduced new clean technologies, and invested aggressively in improving its emission and discharge facilities so as to minimize the amounts of volatile organic compounds and other odorous substances.

KPB’s stakeholders also i너ㅎ어볼래래clude business partners, including the waste control specialist agencies and transportation agencies. In an effort to ensure these businesses’ compliance with environmental regulation and also to prevent environmental accidents involving them, KPB dispatches its employees to these businesses every quarter to monitor environmental management and compliance and provide feedback and training.

KPB will continue to seek the input of diverse stakeholders in its environmental management and mark itself as a sustainable and contributing member of the local society.

(company-specific) Approved EXporter

This system has been introduced to provide support for time and cost savings at the time of issuing a certificate of origin as an increasing number of countries have signed free trade agreements.

A system where the customs authorities provide any exporter approved as capable of proving the origin of the goods with such benefits as simplified procedures for the issuance of certificates of origin, omission of the submission of attached documents, etc.

* Korea-EU FTA : In the case of the exportation of any consignment consisting of originating products whose total value exceeds 6,000 euros, only an approved exporter can self-issue a certificate of origin.
* Korea-ASEAN, China, India, Singapore, Vietnam FTA : Submission of attached documents may be omitted when applying for the issuance of a certificate of origin.
* Korea-EFTA FTA : When an exporter self-issues a certificate of origin, such exporter’s signature may be omitted.

Differences between the company-specific AEX and the product-specific AEX.

ㅇThe company-specific approved exporter system is a blanket authorization system where the procedures for issuing a certificate of origin are operated in a simplified way for all the free trade agreements and all the export goods.

ㅇThe product-specific approved exporter system is a system where the procedures for issuing a certificate of origin are operated in a simplified way after granting authorization as an approved exporter for each relevant FTA and the six digits of each relevant HS code.

AEO (Authorized Economic Operator)

An authorized economic operator (AEO) is a “party involved in the international movement of goods in whatever function that has been approved by or on behalf of a national customs administration as complying with the World Customs Organization (WCO) or equivalent supply chain security standards.” Authorized Economic Operators include companies and parties concerned that are related to logistics such as importers, exporters, transporters, transportation brokers, warehouses operators, and customer brokers. The AEO concept was established by the WCO and the international community to ensure the security and smooth movement of goods in response to the U.S. trade security measures, which were reinforced after the September 11 attacks.

The introduction of the AEO program enables customs administrations to reject existing practices that had granted selective benefits of customs clearance procedures, which are based on fragmentary standards by the distributor and instead, evaluate the sincerity all distributors based on integrated standards. Consequently, once recognized as excellent, the company can enjoy comprehensive benefits in customs processes, which range from customs clearance for import and export to tax payment.

Three Features of the Korea AEO System

1. The integrated operation of the Business Evaluation System and the Security0 Management System can avoid the overlapping evaluation of a company.

2. The internal control system of a company is autonomously strengthened to increase the degree of law compliance.

3. The ASC concept is more specified. The Korean AEO system is focused on giving benefits by connecting overseas export networks with domestic import networks. Once an AEO status is given to all relevant companies, such as overseas producers and transporters (exporters), international transportation brokers, domestic cargo handlers, warehouse operators, customs brokers, and importers, they can receive unprecedented benefits.

Responsible Care

Responsible Care (RC) is a global initiative with regard to the environment, safety and health, where most of the developed countries and multinational companies are involved. This is the most comprehensive and long-term program practiced by the chemical industry. RC is a concept that even covers the local residents’ safety and the employees’ health by complementing the existing ISO 1400 (Environment Management), which was mainly engaged in the environment. It is also a voluntary management movement where companies participate with responsibility, which is different from existing regulations-centered environmental policies.

Even though the chemical industry has played a pivotal role in all the industries, it has been recognized as a culprit in the current negative issues because of the emphasis on the risks of chemicals. In this context, the purpose of this initiative is for chemical companies to have more endeavors to ameliorate environmental safety, thus simultaneously recovering its reliability and improving its image.

After adopting RC in 1992, Korea established the Korea Responsible Care Council (www.krcc.or.kr) in December 1999 and became a member of the Responsible Care Leadership Group in September 2000. Factory 1 of Kumho P&B Chemicals has also been actively engaged in the RC initiative after signing a voluntary agreement.