1. Corporate Sustainability Management 2. SDGs Strategy ...corporatecitizenship.posco.com/citizen/.../file/best_practices_UN_SD… · by hardships and resume their normal daily lives.

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2. SDGs Strategy and Best Practice

Sustainable Development Goals (SDGs) and Efforts of

POSCO

POSCO implements responsible management activities and

offers sustainable solutions for its customers and the society

based on the trust of the parties concerned. Since the

adoption of the Sustainable Development Goals (UN SDGs)

by the UN in 2015, POSCO has been participating in its

activities to fulfill its role as a corporate citizen.

The corporate citizenship activities of POSCO are largely

composed of three core areas: i) “Collaborate,” where

POSCO collaborates with the government, specialty NGOs

and media organizations, ii) “Create,” where the wide range

of capabilities of each POSCO Group affiliate is networked

and utilized, and iii) “Differentiate,” where POSCO

develops differentiated, masterpiece- level brand programs.

In particular, POSCO emphasizes the three key areas of

“Sustainable Local Community,” “Provision of High- Quality

Education” and “Support for Economic Independence.”

『Corporate Citizenship Activity for shaping a better

tomorrow with the community』

POSCO considers coexistence and mutual benefits with

local communities to be among the most important values.

By expanding and supporting the infrastructure of local

communities from Pohang and Gwangyang, where POSCO

steel plants are located, to the 53 countries where POSCO

conducts business, POSCO continues to endeavor in

improving quality of life in local communities.

1. Corporate Sustainability Management

Implementation Strategy and Current

Status

In order to create a corporate ecology where economic

values and social values form a virtuous cycle without

discrimination among the parties concerned, POSCO is

implementing various plans as a corporate citizen that not

only pursues economic gain but also the value of coexistence

and mutual benefits by engaging in social activities as a

member of society.

Corporate Citizen POSCO - Building a Better Future

Together

With the management philosophy “Building a Better Future

Together,” POSCO has declared the management vision

of “With POSCO, We’re the POSCO.” We are currently

practicing Business With POSCO where POSCO creates

value together with customers, suppliers and business

partners, Society With POSCO where POSCO works with

people to build a better society, and People With POSCO

where POSCO builds a corporate culture of trust and

creativity.

The concept of POSCO as a corporate citizen is a company

actively implementing a variety of activities to resolve social

issues, in addition to achieving its objective as an economic

unit due to the increased social influence the company has

and role it plays. It also includes various activities to create

social value, which ultimately results in increased corporate

value.

Participant Since 31 May 2012

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- POSCO Steel Village Project -

POSCO Steel Village project is designed to provide houses and schools by utilizing

POSCO’s own steel products and expertise in construction technology, to ensure the

economic independence of local communities. The project built welfare facilities in

Pohang, Gwangyang, Incheon and Seoul, and provided housing to people who lost their

homes due to disasters such as fire to allow families to overcome the difficulties caused

by hardships and resume their normal daily lives. Furthermore, POSCO is providing various

infrastructure to local communities overseas. POSCO has built 104 steel houses and steel

bridges in Vietnam, Indonesia, respectively. In Thailand, a steel dome was constructed

and donated to a Thai school where students can enjoy sports activities on bad weather

days. This Steel Village initiative had been previously registered on the UN’s SDG website

as ideal and was selected in November 2017 as an eminent example and it also acquired

SMART certification by the UN Office for Sustainable Development.

- Sharing with Local Communities -

① Talent Volunteer Group

Each POSCO employee volunteers for an average of 32 hours (as of 2017). With these

volunteer activities, POSCO employees have been gaining the trust of local residents

and are contributing to the effort to create a better environment. Recently, POSCO have

begun to provided wide range of volunteer activities using their individual talents based

on professional expertise as well as personal interests.

② Global Employee Volunteer Corps

Since 2015, POSCO Global Employee Volunteer Corps. have been participated in

constructing the Steel Village in Vietnam.

In January 2017, there were 41 volunteers from the 5th Global volunteer corps, the group

began by offering services to local welfare facilities including a school for the disabled

and the orphanage, and participated in the construction of houses to improve the poor

living conditions in the area. Local employees from the Vietnam office and corporate also

joined the volunteers from Korea. In August 2017, 51 members of the 6th Global volunteer

corps visited Rayong in Thailand and contributed to construction efforts in the area.

③ Sisterhood Villages

POSCO has been providing continuous support and engaging in sharing activities,

beginning with Hagwang Village in Gwangyang. Since then, we have implemented “One

Department for One Village” efforts and carried out our employee volunteer activities on

a regular basis. POSCO has been offering a total of 203 sister villages with the efforts

made by POSCO employees to build a better future together with local communities and

local residents, the sister villages are being upgraded to better places to live.

Support Activities for

Sustainable Local Communities

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Café OAsia Silver Home Care

Cafe OAsia is the first social collaboration union certified by the Ministry

of Employment and Labor created by POSCO and SESNET, and it is a social

franchise cafe consisting of small-sized cooperatives. Cafe OAsia hires

migrant women for marriage as baristas, providing them a source of income

to help them achieve independence and adjust to the life in Korea. It also

utilizes joint procurement and marketing to reduce cost, and profits earned

through the franchise business are used in multi-culture campaigns and job

creation.

The Silver Home Care service continues the spirit of the “老老 Home Care”

program that began in Pohang since 2015. It is a program that provides care

services to the elderly with mobility issues. A caretaker visits a household

four times a month and provides services such as cleaning and tidying and

helping with meals, as well as emotional services such as helping them go

out. A total of 180 elderly people received help in 2017, and the program

was also able to create jobs for 30 elderly people as well.

Indonesian Social Company (PT.KPSE) POSCO Humans

To contribute to the effort to create jobs in the local communities where

POSCO conducts business, POSCO formed PT.KPSE Services Indonesia (PT

Krakatau POSCO Social Enterprise Services Indonesia) together with the

KOICA as part of the POSCO 1% Sharing Foundation project. The company

provides employment and vocational training to young adults in the area

centered on three villages in Cilegon where the steel plant is located,

and the profits earned from its business are used for social contribution

activities.

To promote productive activities and create high quality jobs to improve the

quality of life, POSCO has formed a social company to help such activities. In

particular, POSCO Humans, which was launched in 2013, employs neighbors

who are experiencing hardship due to extended periods of unemployment

or disabilities, to do administrative work, IT, cleaning, vehicle support or

Steel House construction projects, making it Korea’s first affiliate-type

company with a standardized workplace for the disabled.

POSCO pursues continuous, comprehensive, and sustainable economic growth by

stabilizing personal lives by providing quality jobs, and continuously implements

corporate citizenship activities to improve the employment opportunities and economic

independence of the socially weak.

[Table] POSCO Offers a Variety of Economic Independence Support

Economic Independence

Support

Beyond Number of Volunteers

: 100(2017)

One hundred college students are selected every year to

engage in many volunteer activities including the House of

Love building project and cultural exchanges, helping them

experience the true value of sharing.

Do Dream Number of

Beneficiaries

Independence

Education: 30

E mployment-Linked

Education: 3(2017)

With the Do Dream project, which newly began in 2017, POSCO

provides outstanding mentors selected from among POSCO

employees to allow children leaving welfare facilities to be able

to achieve independence and successfully settle in society

with suitable jobs.

Chinchin

Rainbow

Project

Number of

Beneficiaries

53 (2017)

The Chinchin Rainbow Project provides personalized

career support education such as high quality education,

technology education and vocational training, and education

for college admission, and one on one mentoring with case

managers for multicultural, North Korean refugee and low-

income families.

This annual program consists of career support, visits to public

organizations, introduction of exemplary practices , beneficiary

gathering, and periodic voluntary activities.

[Table] POSCO Offering Opportunities for High Quality Education

Opportunities for

Comprehensive and

Quality Education

Since its foundation, POSCO has been offering opportunities for all children and youths

in the local communities to receive comprehensive and fair quality education with the

objective of supporting their independence.

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Byproduct Gas Utilization

Technology

Water-Sprayed Furnace

Slag Recycling

Development of Energy

Efficient Electrical Steel

『Corporate Citizenship Activity in Response to Climate Change and for Sustainable

Energy Use』

In February 2010, POSCO officially announced its greenhouse gas reduction objective for

2020 at the seventh Green Growth Committee hosted by the president. The goal is to

reduce the greenhouse gas from producing 1 ton of steel to 2.00 t- CO2/t-, which is a 9%

reduction from the 2007-09 average (2.20 t-CO2/t-S) by 2020, and this goal has already

been achieved. In relation to energy, POSCO created an Energy Efficiency Improvement

Roadmap, and during the first session (1999-2008), POSCO made investments in large

energy recovery equipment and accumulated technologies for energy saving work

methods, and during the second session (2009-15), POSCO invested in small and medium

energy efficiency equipment and implemented smart industry technologies. POSCO,

currently in the third session (2016-20), is implementing many plans to commercialize the

technology POSCO developed for energy use.

Most of the byproduct gases (BFG, COG, LDG, FOG) are recovered as an energy source for

various processes or are used for independent power generation. With the use of energy

recovery equipment such as coke dry quenching (CDQ) and top gas pressure turbine

byproduct gas generation equipment and LNG generation equipment at the Pohang Steel

Plant and Gwangyang Steel Plant, POSCO is able to provide 72% of its overall power

consumption for 2017 in the two plants. This is a 6% increase compared to the 2016

independent power generation ratio.

Water sprayed furnace slag is made by rapidly cooling furnace slag in a molten state

produced during iron making by spraying water on it, and as it features a chemical

composition similar to that of cement, it is made into powder and used in cement

production. The use of slag as a clinker replacement will contribute to efforts to preserve

natural resources such as limestone, and as it can reduce the amount of energy used for

cement plasticity and the amount of CO2, cement makers mix approximately 5% of slag

when producing regular cement. POSment, developed by POSCO, is characterized by its

higher slag content and improved physical properties such as compression strength, and it

is also capable of reducing CO2 generation by approximately 60%. In 2017, POSCO used

10.9 million tons of water sprayed slag as cement ingredients and achieved a greenhouse

gas reduction effect equal to 8.6 million tons.

The energy efficiency of electrical steel used in generators, transformers and motors

is critical in determining the level of power consumption reduction. The high energy

efficiency electrical steel developed by POSCO has low iron loss and high magnetic flux

density properties that contribute to improving the energy efficiency of the final product.

POSCO manufactured 450 thousand tons of high energy efficiency electrical steel in 2017,

which is a 5% increase compared to 2016, and it is an increase of 1.3 times compared to

the amount sold in 2010.

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POSCO continuously monitors the contamination level of the seabed and the population

of marine organisms in the seas near its steel plants. Furthermore, in order to preserve

the marine ecology from being destroyed due to industrial activities, POSCO implements

purification activities with the Clean Ocean Volunteer Group established in 2009. Since

September 2013, POSCO has been endeavoring to protect the diversity of marine plants

and fish from starfish and sea urchins, whose populations have increased dramatically

around Korea’s clean water areas, Ulleungdo Island and Dokdo Island. POSCO continues to

provide volunteer services for underwater and seaside areas together with local fishing

and environment organizations every year, and the company is also making efforts to

promote the importance of marine diversity in its company activity blog.

“Triton,” used for rejuvenating marine plant areas damaged due to the rise of water

temperature, has the effect of restoring marine plants, fish and shellfish in damaged

marine ecologies. Its main component, steel slag, is rich in minerals such as calcium

and ferrous that are beneficial for marine ecologies and help vitalize the growth and

photosynthesis of marine plants, and also help filter contaminated deposits and water.

In addition, the marine forests formed around Tritons are characterized by their ability

to fixate CO2 through slag carbonating and photosynthesis by marine plants. POSCO

signed an MOU to develop measures for marine climate changes with the Ministry of

Maritime Affairs and Fisheries in 2007 and an MOU for marine forest and resource

formation in 2010, and POSCO continues to implement marine forest formation programs

in collaboration with the Korea Fisheries Resources Agency (FIRA) and Research Institute

of Industrial Science and Technology (RIST).

Preserving the Diversity of

Marine Organisms

Artificial Reef (Triton)

Formation