Expanding Non-Fuel Businesses

In response to the declining profitability of S/Ss and F/Ss due to intensifying price competition, S-OIL has developed a variety of competitive non-fuel businesses, including car wash, F&B, and convenience stores, which affiliated S/Ss and F/Ss can adopt to diversify their revenue portfolio. The Company has partnered with E-Mart 24 to develop and distribute a manned/unmanned smart convenience store model optimized for service stations, and the Company helps the marginalized to become more self-reliant by granting them the right to operate a Sunshine Sharing convenience store. The Company also supplies competitively priced, high-quality proprietary products, such as urea solution and ethanol washer fluid, to help service stations increase profits and customer convenience.

S-OIL Champions Club

Each year, as part of its efforts to strengthen long-term partnerships with affiliated S/Ss and F/Ss, the Company recognizes and rewards affiliate stations that have achieved excellence in service, facility management and other operational aspects, sales volume and profitability as 'S-OIL Champions Club'. The program not only promotes fair competition among stations, but also contributes to the improvement of their operations by sharing best practices.

Accessible Fueling Service

As the number of self-service stations continues to increase, the Company has launched a nationwide campaign to provide assistance to people with disabilities, pregnant women, and others who have limited access at self-service pumps.

Mobile Application Upgrade

In February 2023, S-OIL upgraded the 'MY S-OIL' application with new features and enhanced customer convenience. The upgrade significantly improved customer convenience by introducing a simplified multi-payment (instant fueling) function enabling customers to pay with credit cards, loyalty points, and gift certificates at the same time; mobile voucher/point registration, collection, and redemption; and frequent service station search. In addition, as part of our ESG management, the Company has introduced the electronic receipt function in the app and promoted it in cooperation with the Korea Environment Agency.

Various Quality Checks and Preventative Activities

Product Quality Claim Response Procedure

Domestic Marketing

With the goal of becoming a top-tier brand and the No. 1 player in the market, S-OIL is systematically implementing brand management and integrated marketing activities. In particular, the Company utilizes the GooDoil character to convey the essence of our quality philosophy, 'Good Oil,' not only in advertisements, but also in various consumer contact points such as S/S and F/S, events, promotions, as a symbol of the Company, and to communicate with customers in a friendly manner.

Major Domestic Marketing Activities in 2023

Overseas Marketing

In the current uncertain market environment, S-OIL is actively monitoring import demand trends in Asia-Pacific, its major export region, and strategically increasing direct supply to local wholesalers and retailers to establish a stable sales network to major import destinations in the region (e.g. Japan and Australia).

Strengthening Partnership with Aramco and its Subsidiaries

S-OIL is strengthening its business cooperation with its majority shareholder, Aramco, and its subsidiaries to solidify its marketing base in the global market and explore new business areas for additional profitability. As part of these efforts, in September 2022, the Company signed a Refined Product Offtake Agreement (RPOA) with Aramco Trading Singapore (ATS), a subsidiary of Aramco, to maximize synergies between the two companies and increase profitability through continued stable and efficient trading.

Expanding Sales and Relationships in Key Strategic Overseas Markets

S-OIL continues to export to key strategic markets such as Japan and Australia. The Company is also implementing multi-layered marketing activities, such as the Customer Care Program, aimed at strengthening our customer base in these regions.

Responding to Increasing Demand for Eco-friendly Fuels

Given the recent focus on combating climate change and achieving carbon neutrality, market demand for environmentally friendly fuels is expected to grow steadily. In response, the Company has laid the groundwork for the production of eco-friendly fuels and has begun production of biofuels and other sustainable fuel products that have received international certification. In order to secure new sales partners and facilitate the smooth export of these products to overseas markets, the Company is actively conducting related market research and customer development.

Domestic Marketing

S-OIL, which was the first in Korea to produce lube base oil in 1981, has established itself as a market leader in the Korean market by stably supplying reliable and premium quality products. Leveraging our diverse product line, the Company provided customized marketing and expanded our loyal customers with stable supply capacity. Going forward, the Company will continue to maintain our competitive edge and further strengthen our leading position as the top lubricant base oil company in the domestic market.

Overseas Marketing

Lube Base Oil

The Company has maintained stable sales of our entire lubricant base oil production inventory through marketing strategies tailored to each market and active utilization of our production capacity, which is the world's second largest by single site. Specifically, the Company is increasing our lubricant base oil trading volumes and market presence through international collaboration with the Aramco Base Oil Alliance, a group of Saudi Aramco subsidiaries with lubricant base oil production capacity. The lubricant base oil market experienced a gradual decline in the second half of 2023, mainly due to increased competition from global oversupply, but for the year as a whole, the market remained strong for the third consecutive year since 2021, with solid margins and performance.

Lube Oil

Since the integration of the S-OIL SEVEN brand in 2014, the Company has continued to consolidate its position in domestic and overseas markets. In 2023, despite the continued economic downturn in China, one of our key markets, the Company exported lube products to more than 60 countries worldwide, mainly in other Asian countries, and made various efforts to diversify our sales outlets, resulting in the highest export performance in our history.

And the Company continued to strengthen cooperation with local partners overseas. Notable achievements include a new supply of service fill lubricants to Kia Motors in India, and in Indonesia, the Company successfully expanded factory fill and service fill supplies to Hyundai Motor plants. In particular, the Company further strengthened the foundation for a sustainable lubricant business by successfully taking over the lubricant supply business to Hyundai Motor in Korea, which was previously handled by our subsidiary S-OIL Total Energy Lubricants.

Domestic Marketing

For aromatic and olefin monomer products, the Company has established long-term partnerships with major domestic customers and maximized domestic sales through pipelines in the Ulsan Petrochemical Complex, securing a stable revenue base. The Company also established logistics partnerships through various swap transactions and played a more active role in coordinating supply and demand within the complex. Our stable supply of olefin monomer not only strengthens our position in the petrochemical market, but also contributes to the competitiveness of related industries in the olefin value chain by expanding cooperation with various petrochemical derivatives companies.

Since 2018, through the RUC/ODC project, S-OIL has been producing polypropylene and propylene oxide, which are olefin downstream products, and selling them in both domestic and international markets. Polypropylene products face fierce domestic competition as domestic production exceeds demand, but the Company plans to respond effectively to the highly dynamic global market and further expands domestic sales to ensure relatively high profitability. Therefore, the Company plans to increase sales to domestic customers in various applications using polypropylene such as appliances, automobiles and household goods.

As for propylene oxide, it is imperative to expand our domestic customer base and increase sales volume, as the domestic market has become oversupplied since the commercial operation of our production facilities, and it is more profitable to sell domestically than to export. As a result of our efforts to maximize domestic sales, in 2022, the Company signed long-term supply contracts with all major domestic polyol companies, and in 2023, the Company sold the entire production to domestic clients, thus solidifying a stable sales base in the domestic market. In 2024, while continuing to sell all of our production domestically, the Company plans to maintain sales stability through long-term supply agreements with customers in Korea.

Overseas Marketing

Taking into account the different production processes and market characteristics of various petrochemical products, S-OIL is diversifying its marketing activities to be optimized for each market through systematic market research and core customer development. In preparation for oversupply resulting from large-scale capacity expansion in China, the Company has strengthened our partnerships with key domestic customers. At the same time, the Company is seeking new customers with expected future demand growth to ensure a stable sales base and profitability.

Furthermore, with an established customer network and accumulated efficient marketing experience in the Asian market, the Company is leveraging the global network of Aramco Trading Company (ATC) to secure competitiveness in the Asian region as well as offshore markets. In so doing, the Company is expanding its customer base and strengthening our market position in the fast-paced petrochemical market.

Reinforcing Business Cooperation with SABIC

Under a strategic partnership based on the principle of maximum mutual advantage, the Company has signed long-term export contracts with Aramco, a company with strong marketing capabilities and sales networks in foreign markets, and used Aramco's existing foreign sales channels to enter major markets including China and South Asia. Since July 2021, in line with Aramco's strategic direction, the Company has partnered with SABIC, a petrochemical subsidiary of Aramco, and based on the continuous partnership between two companies, the Company has successfully exported polypropylene products to major markets such as China, Southeast Asia and Turkey, while actively expanding export sales to overseas plants of Korean companies.

Specifically, since 2022, the Company has been expanding our export destinations through the development of profitable markets and the diversification of our sales regions, which include Europe, the Americas, and Africa, in addition to our existing focus markets of China and Southeast Asia.

With regard to propylene oxide, all of our production will be delivered to domestic customers in 2023, and the Company plans to continue with the domestic sales of all of our production in 2024. Having said that, the Company is strengthening our partnership with SABIC in case the Company needs to export the production, depending on the market conditions.

Domestic Marketing

S-OIL has made continuous efforts in various areas to increase its domestic market share in the face of deteriorating sales conditions due to stagnant demand for petroleum products, growing market uncertainty, and intensified sales competition among suppliers. In addition to securing reliable new customers by expanding our sales network (such as S/S, F/S, and direct sales points), the Company has also effectively implemented differentiated competitiveness programs aimed at improving relations and sales with existing customers. Consequently, our share of the retail market for light crude oil reached an all-time high of 27.1% by 2023, and our share of the service station network exceeded 20%.

Going forward, the Company will strive to further increase our share of domestic sales by effectively implementing existing sales promotion measures, engaging in creative brand marketing, and actively seeking new business opportunities.

Due mainly to increased competition and deteriorating profitability in a saturated market, the number of service stations in operation nationwide has been on a declining trend since 2011. This downward trend can therefore be expected to continue in the near future unless business conditions change for the better. However, in spite of this nationwide downward trend, S-OIL has been able to increase its share of the service station network over the past year through aggressive efforts to expand its network.

Overseas Marketing

S-OIL designs and achieves a variety of qualitative goals to improve the profitability of overseas marketing and to strengthen its capabilities.

Creating Female-Friendly Environment

For the 2023 recruitment, S-OIL increased communication efforts to overcome its male-dominated image by creating a recruitment website and YouTube content, and strategically implementing offline and online promotions (subway digital signage and ads on major social media), successfully increasing the percentage of female applicants each year.

Female Applicants in Recruitment of College Graduates in 2H 2023 Female Ratio

The Company strives to ensure that no one is discriminated against on the basis of gender by implementing gender equality policies throughout the recruitment process, for example by having female recruiters for campus recruitment and female interviewers for interview selection, and by conducting gender equality training for interviewers. Additionally, in 2023, the Company hired 35 female employees, further promoting diversity within the Company's workforce.

S-OIL conducts gender equality or diversity awareness training for all employees. For female employees, the Company has various HR and benefits systems in place to foster a work-life balance environment and provide practical support. In particular, the Company provides maternity care programs, including childbirth allowances, in-house lactation rooms, and ergonomic office furniture for pregnant women, as well as substitutes for parental leave in order to reduce the psychological burden on female employees.

And the workplace nursery, which has been operating since 2017, provides practical support to all employees who are raising children. The Company will continue to pay attention to and make efforts to actively recruit female employees, while continuing to promote and improve the Company's female-friendly benefit systems, so that talented female applicants are interested in and pursue careers in the refining and petrochemical business.

Employment of Persons with Disabilities and National Merit

S-OIL takes care of socially marginalized groups by continuously hiring the disabled and national meritorious and providing equal treatment and working environment for non-regular employees. For example, after sponsoring the Heart-to-Heart Orchestra since 2009, the company has hired the members of the orchestra as employees from 2022. Composed of developmentally challenged youth, the orchestra holds small concerts on a weekly basis to improve disability awareness and share cultural activities with the local community.

Leadership Training

S-OIL provides feedback to leaders who have an impact on the Company's performance and organizational culture through regular leadership assessments in collaboration with external specialized organizations. Also, the Company supports them in developing their own competency development plans and participating in training at domestic and overseas universities and major institutions related to the latest business trends, technology and leadership. Officers actively participate in public speech lessons in addition to existing programs such as intensive coaching and attending domestic and international graduate courses, conferences and seminars to stay abreast of business developments and gain relevant insights.

New team leaders take part in onboarding training on performance management, employee motivation, and other topics to help them make the transition from being high-performing employees to being effective leaders. In 2023, S-OIL's leaders also received leadership training on Autonomy, Mastery, and Purpose (A.M.P.) to improve employee's intrinsic motivation, based on which officers and team leaders set action plan for their organization's A.M.P. Then, at the end of the year, those action plans are assessed through 360 degree evaluation.

Onboarding Training

New employees at S-OIL undergo onboarding training to gain an understanding of the Company, basic business skills needed to perform their jobs, and communication skills for smooth collaboration. In particular, the Company offers specialized training in data analytics and global communication (e.g. understanding Arabic culture and business English). This training equips new hires with the necessary future and global skills. Upon joining the Company, new employees are invited to participate in the Dynamic Rookies Program, which includes communication session with CEO. Through this program, young employees have opportunities to revisit the Company's vision and strategy, linking it to their own roles, which enhances their level of engagement with the Company.

Engineer Cultivation Program (ECP)

S-OIL also has the Engineer Cultivation Program (ECP) in place to support the systematic growth of engineers. The ACT-Engineer Program, jointly developed by EnergyTech (formerly Saudi Petroleum Services Polytechnic) and IFP Training, has been in operation since 2019, and 66 junior engineers have completed the program thus far in 2023. The program is designed to help young engineers acquire in-depth knowledge of processes and apply it to their actual work in order to improve the operational efficiency of the plant and contribute to production cost efficiency.

Short-term MBA and overseas intensive courses are also offered to foster engineers with international mindsets and qualities. In 2022, the Company introduced the Process Engineer Training for Refinery Operations course, which aims to improve the skills of engineers as production managers by providing systematic training on on-site operations.

Data Scientist Cultivation Program

As part of its efforts to successfully implement its Digital Transformation (DT) roadmap, S-OIL is implementing training programs to strengthen the DT capabilities of its employees. Beginning in 2021, the Company implemented a data scientist training course and in-house certification program to strengthen the organization's ability to analyze data and generate business insights. In 2023, a total of 87 employees completed the program as internal data scientists.

The intermediate course for data scientists, which was introduced in 2022, enables participants to solve real-world business problems using machine learning technology and project-based learning, and is expected to generate new profits and reduce costs worth KRW 3.95 billion on an annual basis. In addition, the advanced course was established in 2023 to help participants obtain advanced training in deep learning and machine learning, as well as global certifications on data analysis.

Global Communication Training

S-OIL is keen to strengthen the global communication skills of employees in order to drive the Company's global expansion. By operating the Global Learning & Communication Center (GLC) at the Head Office in Seoul and the Refinery in Ulsan, the Company offers training on foreign languages used at work, including English, Chinese, Japanese and Arabic, and cours¬es to facilitate communication with overseas business partners, such as global cultures, business etiquette, speech training, and induction training prior to overseas assignment. In particular, the GLC operates effective programs catering to specific needs based on employees' roles, such as team leaders, new employees, engineers, and core talents.

The Company takes various approaches to training, such as group classes, including group training and one-on-one courses, to make training more effective and convenient from the users' perspective. In 2019, the Company launched the S-OIL Toastmasters Club, where employees from different functions engage each other to improve their leadership and English-speaking skills, and in 2021, the Company received the corporate recognition award from Toastmasters International for the accomplishments of the club.

Potential Future Leader Program

With a firm belief that cultivating core talents will drive the Company's future success, S-OIL runs a systematic Potential Future Leader Program to nurture the next generation leaders. Potential Future Leaders, selected through a rigorous selection process, undertake leadership development activities and job expertise development activities in accordance with the Leadership Development Plan. Continuous mentoring and monitoring are also provided for more systematic implementation of the program.

Trainees accumulate diverse work experience through cross-functional job rotation, and the Company also supports them in pursuing an MBA studies at home or abroad, or a master's degree in science and engineering at the IFP School in France, to build a pool of leaders with global business competencies. Through this systematic approach to talent cultivation, Potential Future Leaders will lead the Company's sustainable growth.

Specialist Program

S-OIL operates the Specialist Program in order to secure and develop highly specialized resources that are essential to maintaining the competitiveness of the Company. S-OIL determines the target jobs based on substitutability, developmental characteristics, and business impact, and selects Potential Specialists through a rigorous selection process each year. Once selected, Potential Specialists are trained to become experts in their respective fields through systematic and high-quality professional development programs, such as obtaining professional certificates and training at domestic or foreign specialized institutions in accordance with the expertise development plan. The potential specialists are then reviewed and re-evaluated by a group of expertise evaluators to select the specialists. Through this process, employees will grow to become the key assets that will drive the competitiveness of the Company.

Housing Stability Support

To help employees focus on their work with housing stability, S-OIL offers low-interest loans for housing, as well as the New Pension Program, a matching grant scheme introduced in 2015 in which the Company pitches in for employees' post-retirement resources, to help them prepare financial resources for a stable life after retirement. The program is designed with a structure that accumulates differently depending on the Company's mid- to long-term management performance, thus encouraging employees to take an interest in the Company's mid- to long-term growth and development.

Childcare Support

S-OIL supports employees' childbirth and upbringing by providing tuition funds, as well as maternity benefits and postnatal care center expenses, and operates workplace daycare centers at its Head Office and Refinery. In a situation where public daycare centers are in short supply and private daycare centers are unreliable, the operation of workplace daycare centers not only relieves the burden of childcare for employees with infants and young children, but also contributes to the job satisfaction of employees.

In particular, the Company aims to create the best childcare environment in Korea through close and systematic communication between employees, the childcare institution, and the Company. Thanks to the efforts to promote gender equality in the workplace and implement various systems to help balance work and family, the number and proportion of female employees at S-OIL is increasing every year.

Health Care

To promote the health of employees and respond quickly to emergencies, S-OIL operates healthcare centers at the Head Office and Refinery with nurses on duty at all times, as well as maternity rooms for pregnant and nursing employees, and ergonomic office furniture for expectant mothers. In 2022, the Company launched the New Healthcare Program to support health promotion activities for employees.

The Company also provides annual health check-ups at high-quality medical institutions and supports recovery from illness through medical assistance and a sick leave system. In addition, the Company runs the physical fitness centers at the Head Office and Refinery and conducts regular health campaigns. To promote employees' mental well-being as well as physical health, the Company also runs an employee counseling program where external experts provide coaching and counseling in various areas such as work stress, interpersonal relationships at work, family relationships, and parenting.

S-OIL's Employee Benefits Program

Human Rights Policy

S-OIL respects the human rights standards set forth in the Universal Declaration of Human Rights, the UN Guiding Principles on Business and Human Rights, the UN Global Compact Principles on Human Rights and Labor, the UN Convention on the Rights of the Child, the ILO Declaration on Fundamental Principles and Rights at Work, as well as the laws and regulations of the country in which the Company operates, and so on. The Company strive to protect and significantly improve the human rights of all communities affected by our operations as well as our own business sites. To this end, the Company adhere to the following eight principles. In addition, suppliers of products or services, direct investment companies, and business partners should also share our human rights policy and participate in protecting and improving the human rights of the community in accordance with the eight principles.

1. Working Environment

   We will respect and treat our employees with dignity and provide working conditions that exceed legal standards, including pay, working hours and rest periods. We will uphold the right to freedom of association and the right to collective bargaining, and employees will not be subject to unfair treatment on this basis.

2. Safety & Health

   We will provide a safe working environment for employees and continuously improve the safety and health management system. We will minimize the impact of our production processes or products and services on safety and health

3. Harassment

   We will protect all stakeholders, including employees, business partners, and local residents, from exposure to any form of harassment (sexual and non-sexual) that violates human dignity.

4. Forced Labor and Child Labor

   We will not engage in forced labor against the will of employees and will not receive labor related to employee liability. We will not directly employ children under compulsory education age or under the age of 15. We will respect and protect children's basic rights to education, rest, health, nutrition, hygiene, freedom from violence and exploitation.

5. Discrimination

   We will prohibit discrimination based on race, color, religion, sex, national origin, age, disability and provide equal opportunity and treatment..

6. Information Protection

   We will use personal information only for the purpose for which it was acquired, and continuously check and strengthen the management system to prevent personal information leaks.

7. Human Rights of Local Communities

   We will prevent negative impacts on the human rights of local communities based on respect for their culture. We will contribute to improving the quality of life of local residents by supporting economic, social and cultural development.

8. Human Rights Due Diligence

   We will systematically monitor potential human rights risk groups and issues, take immediate remedial action when risks are identified, and prevent similar cases from recurring. We continuously upgrade our human rights management system to prevent human rights issues from occurring throughout the supply chain.

Human Rights Inspection Matrix (Conducted in 2022)

Protection of Whistleblower

S-OIL does not disclose any information that reveals or alludes to the identification of the information without his/her consent. S-OIL guarantees the informant is not subject to any disadvantages in his/her status and/or discrimination in working conditions on account of reporting or submitting information. The reporting system is operated securely, and protective measures are taken to ensure the informant is not disadvantaged based on his/her report.

Advisory support

Every quarter, S-OIL conducts joint inspections of safety and health documents (e.g. training records, inspection history, protective equipment registers) and site audits of suppliers to improve safety management and prevent industrial accidents. The Company has added new programs for suppliers, such as risk assessment based on the Korea Risk Assessment System (KRAS) and consulting for obtaining KOSHA-MS certification. The Company also conducts daily pre-job safety training on general and special safety rules, task-specific safety rules, accident cases, and emergency response to improve safety awareness among suppliers' employees.

Through these activities, 10 new suppliers obtained KOSHA MS certification in 2023, bringing the total number of certified suppliers to 42, and 41 suppliers also obtained KRAS-based risk assessment accreditation from the Korea Occupational Safety and Health Administration (KOSHA). By actively supporting suppliers in building their own safety systems, the Company aims to create safe workplaces with world-class standards.

Safety Management Training

In addition, to ensure better safety management at work sites, the Company has established qualifications for suppliers according to their roles and ensured that only qualified people perform their duties for certain safety-critical positions, such as safety managers, supervisors, heavy equipment flagmen, and signalmen.

In addition, to achieve an accident-free workplace during turnaround and inspection (T&I) periods, the Company provides suppliers involved in T&I work with training on gas meter use and management, safe handling of hazardous chemicals, workplace safety management, accident cases and safety measures, as well as briefings on the processes, main tasks, and potential hazards in the T&I zone.

Implementation of Safety & Health Bid Evaluation

To improve the sustainability of its suppliers, S-OIL operates the Safety Health Bid Evaluation (SHBE) system, which comprehensively evaluates each contractor's core capabilities as well as its capabilities in sustainability aspects such as safety and environment at an early stage, so that only those with a threshold score or higher are allowed to participate in the bidding process and contribute to on-site safety management.

In 2022, the Company expanded the scope to general contractors across the Company to select safety-qualified suppliers for all service contracts to encourage them to improve their safety management capabilities. The Company also motivates autonomous safety management by monitoring the entire process and recognizing employees and contractors who demonstrate excellent safety management behavior.

Support for Contractor Workers' Health Management

As an extension of health management efforts, S-OIL performs joint safety and health inspections with suppliers and offers health guidance. The company also assesses work environments, monitors if health examinations are provided appropriately, and provides health management counseling to promote the health of not only its employees but also the members of its suppliers. Supplier employees also have the same access to health care centers as our employees to receive first aid, medication, and medical treatment for injuries.

S-OIL Safety, Health and Environment Commitment Statement

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This statement is applied to all operation sites in S-OIL

Significant Supplier : 145 companies (accounting for about 75% of total purchases in 2023)

Selection Criteria

1. Suppliers of large volumes of products and service

2. Irreplaceable suppliers

3. Suppliers that have been stably providing products and services for a long period of time

4. Suppliers that are essential to the operation of our main processes

5. Suppliers that are highly relevant to ESG issues such as environment and safety, and can affect the Company's ESG performance

ESG Assessment

As part of the Company's ESG management, S-OIL has established the Supplier ESG Code of Conduct and encouraged its suppliers to comply with it since 2022, and the Supplier ESG Support Program, which was launched in 2022, continued in 2023. The program included an ESG self-assessment survey for 1,180 suppliers registered in the sourcing group, and based on the analysis of the data, 114 key suppliers and suppliers in need of ESG management support companies selected and provided with online training on the importance of ESG. The Company then supported formal ESG assessments for 10 of them and conducted on-site inspections with ESG experts and our procurement staff. These site visits companies more than just check; the focus was on providing recommendations for improvement to help suppliers improve their ESG performance.

Ethics Compliance Pledge for Suppliers and Bidders

The Company's suppliers are required to submit a commitment to comply with the Code of Ethics. In order to emphasize the importance of compliance with the Code of Ethics, S-OIL has invited its suppliers every year since 2013 to inform them about the transparent and objective procurement system and the ethical rules for suppliers, and to verify their compliance with the Code of Ethics.

Supplier Code of Conduct

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Ethics Policy for Suppliers

S-OIL's suppliers shall comply with the S-OIL Supplier Ethics Policy as stated below and shall make efforts to build sustainable supply chains.

1. We comply with international ethics-related regulations as well as anti-corruption and anti-bribery regulations as a member of the na¬tion and local communities.
2. We do not carry out any illegal act such as bid rigging that affects cost estimates.
3. We do not provide or promise to give valuables or entertainment to project owners.
4. We eliminate discrimination in terms of gender, race, nationality, dis¬ability, religion, and union activity.
5. We respect business partners and their employees, and do not have an impersonal manner. We do not restrain employees' physical and psychological freedom illegally, and we do not force people to work against their will.
6. We comply with the working hour requirement and the minimum wage as determined by labor-related laws and regulations.
7. We prohibit employment of minors under the age of 15, and exclude employees under the age of 18 from work with higher potential health and safety risks.
8. We guarantee freedom of association, and prohibit any disadvantage from it.
9. We comply with labor conditions determined by labor-related laws and regulations in each country and region.
10. We provide employees and relevant staff with a safe and healthy work environment, and take proper action to prevent them from being exposed to potential safety risks.
11. We comply with environmental laws and regulations, and recognize that environmental protection is our basic social responsibility.
12. We strive for continuous job creation, and implement social contri¬bution activities for the development of local communities and the national economy.
13. We have S-OIL level or higher ethical procurement policy for our suppliers.

Supplier Briefing Session

In 2023, the supplier briefing sessions, which were held online for the past three years due to COVID-19, were held face-to-face twice each at the S-OIL Head Office and Onsan Refinery, where the Company shared our purchasing procedures, e-Procurement system user manuals, and ethics management.

Support for Strengthening Ethical Management

S-OIL has set ethical management as a goal for managing the sustainability of its partners and is systematically working to achieve this. Since 2020, due to COVID-19, the partner invitation program has been transitioned to a non-face-to-face format. The Company have produced explanatory materials, including topics on ethical management, and distributed them to our partners.

Hope to You (油) campaign

• Providing winter heating oil to low-income families
• Improved heating : 1,205 low-income households, 300 the Companylfare facilities

Service Station Sharing N campaign

• A nationwide program in partnership with 300 S/Ss

Youth food truck fuel support

• Youth entrepreneurship support program

Scholarships for children of freight truck accident victims

College scholarship for suppliers' children

• Scholarship support program for children of workers of small and medium-sized suppliers at Ulsan Refinery starting in 2022 (totaling KRW 180 million)

Activities in Mapo

Since 2011, S-OIL has been organizing free monthly Culture & Sharing performances for local residents in the Mapo neighborhood where the headquarters is located. Family-friendly performances in a wide range of genres are well accepted and enjoyed by more than 2,000 people each year. Local residents who enjoyed the cultural activities have increased their participation in cultural activities to more than twice a year, indicating that the company is making a significant contribution to the revitalization of cultural activities in the local community.

As a guardian of local culture, the Company also support the Mapo Ferry Salted Shrimp Festival, a traditional cultural event in the Mapo area. The Company also operate the GooDoil Café, which provides free cold mineral water in the summer and hot tea in the winter, in partnership with local organizations in Mapo. The Company continue to donate to the Mapo Welfare Foundation and the Mapo Talent Development Foundation, as the Company is committed to the development of the Mapo community.

Activities in Ulsan

In the local community of Ulsan, where the refinery is located, the Company is involved in various community support activities, such as operating the Ulsan Welfare Foundation, sponsoring the construction of the Taewha Pavilion and cultural events, and supporting welfare organizations in the area. In order to boost the pride of Ulsan residents while providing them with a comfortable public rest area, the Company funded the entire budget for the Taewha Pavilion restoration project. This restoration project was completed in 2014, and S-OIL has since supported annual cultural events at the historic site.

In 1993, in honor of a talented local writer, the Company established the Oh Young-Soo Literary Prize, one of the most prestigious literary awards in Korea. And since 1996, the Company has held the Beautiful Eyes Art Festival, an art event that mainly invites amateur artists from the region. The Company also continues to support various cultural and artistic events in the Ulsan area, including the Cheoyong Cultural Festival and the Kyung-sang Daily Literary Awards for Young Writers.

In addition, since 2019, the Company has been supporting the regional trauma center of Ulsan University Hospital in the operation of the doctor cars, which was about to cease operations due to lack of budget, causing great concern about a vacuum in medical services in the heavily industrialized city of Ulsan, which has many heavy chemical companies with a higher risk of accidents.
For Ulsan, the budget was executed with a 95% increase in 2023 compared to the previous year's performance*, and the Company plans to further expand the budget for the Ulsan community in 2024 as the Company strengthens its community outreach efforts.

2022 (KRW 1,470 million) → 2023 (KRW 2,869 million): an increase of KRW 143 million (95%)

Endangered Natural Monuments Protection Campaign

In 2008, the Company launched the Endangered Natural Monuments Protection Campaign with the Cultural Heritage Administration to sponsor the research and protection efforts of specialized organizations dedicated to protecting natural treasures such as otters, red-crowned cranes, Korean spotted barbels (eoreumchi) and long-horned beetles. The Company also operates the country's only college students' natural monument conservation corps.

In 2023, starting with the Natural Monument Conservation Grant Award Ceremony and the inauguration of the 11th S-OIL College Students' Natural Monument Conservation Corps, the Company conducted various activities throughout the year, including the release of eoreumchi into the Geumgang River in Geumsan, the ecological education of long-horned beetles at the Natural Monument Insect Research Institute in Yeongwol, the ecological education of otters at the Korean Otter Research Center in Hwacheon, and the feeding of red-crowned cranes with employee families in Cheorwon.

Janghang Wetland Conservation Campaign

Since 2021, S-OIL has conducted a campaign to preserve the biodiversity of Janghang Wetland, which is registered as a Ramsar site, together with Goyang City and the Han River Basin Environment Agency. Designated as a wetland protection area in 2006, Janghang Wetland is visited by approximately 30,000 water birds, including seven endangered species (including blackfaced spoonbills and white-naped cranes) visit every year. On May 21, 2021, it was registered as the 24th Ramsar site in Korea.

To preserve this protected habitat, the Company supports wetland conservation activities and the creation of ecological tourism environments, and in this regard, the Company supports the restoration of otter habitat in the Han River through the Korea Otter Protection Association. After fencing the trail in 2022, the Company installed safety matting for the trail in 2023, and also contributed to the construction of the Han River Ecological Center. The Company also conducted ecological monitoring and habitat research of otters along the Han River estuary and public awareness programs. In 2024, the Company plans to release otters into the Han River in celebration of the opening of the Janghang Wetland Ecology Center.

Cleanup Activities around Mokdo Island

S-OIL regularly conducts environmental cleanup ac¬tivities around the Mokdo Evergreen Forest, a natural monument located near the Refinery, and continues to expand green procurement to further contrib¬ute to environmental protection.

Yeongnam Alps Silver Grass Plains Conservation Project

The Company invested KRW 150 million to sponsor a project to preserve and restore the silver grass plains in Mt. Shinbul in the Yeongnam Alps in Ulju, which are under increasing threat from alpine climate change and growing tourism.