HD Hyundai XiteSolution, a leading pioneer in the global construction equipment industry, hereby declares our commitment to fulfill social responsibilities to protect the rights of customers, employees, stakeholders and local communities by striving to actively adopt human rights management that recognizes and respects human dignity and values.

HD Hyundai XiteSolution strongly promotes the values of human rights, labor, environment, anti-corruption, and other issues presented by international human rights standards and norms, including the Universal Declaration of Human Rights and the UN Guiding Principles on Business and Human Rights.

HD Hyundai XiteSolution rejects all forms of human rights violations in our business operations whether direct or indirect, and also ensures to establish a governance system that interwinds and connects the board of directors, the chief ESG officer, and relevant organizations on a regular basis. In addition, HD Hyundai XiteSolution implements a robust Human Rights Management Code to underpin our key values and principles which stipulates our human rights policy, operation of human rights management committee, human rights impact assessment, and remedial action for any human rights violations.

In particular, HD Hyundai XiteSolution sets utmost importance on health and safety of our employees, mutual prosperity with business partners, and contribution to the environment and local communities, all of which are the most prominent issues of the industry. HD Hyundai XiteSolution prioritizes these issues as we constantly monitor and manage relevant risks.

HD Hyundai XiteSolution will continuously dedicate itself to and thrive on strengthening human rights management and will work to ensure that our human rights policy is applied and complied with by all stakeholders including customers, shareholders, business partners, local communities, and the government, as well as our employees.

Thank you.

July 19, 2022
Cho Young-Cheul,
President of HD Hyundai XiteSolution

HD Hyundai XiteSolution creates synergy by encouraging creativity, a challenging spirit, and momentum with suppliers around the world by establishing a sustainable supply chain ecosystem. In this process, a code of conduct for suppliers was established to identify and prevent potential ESG risks, and to implement this, the company has established the Supply Chain ESG Management Policy. The Supply Chain ESG Management Policy covers ethics, environment, labor and human rights, safety and health, and management systems as defined by the Supplier Code of Conduct. This policy applies to all our suppliers and their sub-suppliers who supply products and services to HD Hyundai XiteSolution or who have entered into contracts for other transactions.

HD Hyundai XiteSolution will establish a response plan for future risks through the Supply Chain ESG Management Policy and strive to improve it. Together with our supply chain partners, we promise to create greater value by meeting global standards and fulfilling our environmental and social responsibilities.

The Supply Chain ESG Management Policy and the Supplier Code of Conduct were prepared based on global standards such as the UN Guiding Principles on Business and Human Rights (UNGPs), OECD Guidelines for Multinational Enterprises, and ILO Core Conventions.

• A. Sustainable Purchasing

  HD Hyundai XiteSolution selects suppliers that meet ESG management standards that encompass ethical standards when purchasing for the entire value chain. HD Hyundai XiteSolution makes sure that all purchased items, such as raw materials, general materials, services, and intellectual property rights procured from the company, are produced and procured in accordance with ESG standards such as ethical and legal standards. Moreover, HD Hyundai XiteSolution may request relevant evidence in this process.

• B. Supplier Responsibilities and Management Areas

  All suppliers who have business relationships with HD Hyundai XiteSolution must consider HD Hyundai XiteSolution's Supplier Code of Conduct and ESG Management Policy in making business decisions and conducting overall business operations. HD Hyundai XiteSolution and a third-party organization entrusted by HD Hyundai XiteSolution can inspect and conduct due diligence within the bounds of the law to see if the supplier is complying with the provisions of the Supplier Code of Conduct and ESG Management Policy. Suppliers must establish and implement mitigation plans for risks for which improvement has been recommended.

  HD Hyundai XiteSolution's supplier ESG management consists of 38 detailed items in 5 areas: ethics, environment, labor and human rights, safety and health, and management system.

  Category	Subcategories
  Ethics	Transparency in management and anti-corruption, conflict of interest prevention, unfair trade prevention, counterfeit parts prevention, export restriction compliance, information security, responsible raw materials management, ethical channel
  Environment	Establishment of environmental management system, management of energy use and greenhouse gas emissions, management of water resources, management of air pollutants, management of wastes, management of chemicals, prevention of pollution and reduction of resource use, response to environmental regulations related to products
  Labor and human rights	Prohibition of discrimination (recognition of diversity), provision of wages and benefits, management of working hours, humane treatment, guarantee of freedom of association, prohibition of child labor, prohibition of forced labor
  Safety and health	Establishment of the safety and health management system, safety management for machinery/apparatuses/facilities, emergency response, accident management, safety diagnosis, health management
  Management system	Establishment of management system, response to laws and external requirements, appointment of person in charge, risk inspection, training and communication, information management, operation of grievance handling system, management of suppliers (sub-suppliers), compliance with norms

• C. Supplier ESG Evaluation System

  HD Hyundai XiteSolution conducts supplier ESG evaluation to reduce suppliers' risks. This is to promote sustainable management of suppliers by identifying ESG risks that they face. Given the fact that supplier ESG evaluation (due diligence) is emerging as an issue in cross-border trade transactions, HD Hyundai XiteSolution will expand its supplier ESG evaluation.

  • 1. Raising awareness of suppliers

    • Receipt of the consent to comply with the Supplier Code of Conduct
    • Addition of ESG items in the supplier contract
    • Support for ESG and supply chain management training

  • 2. Performing ESG self-assessment

    • Implementing ESG self-inspection for key suppliers

  • 3. Due diligence and verification of self-inspection results

    • On-site inspection of information submitted by suppliers
    • Sharing of ESG management best practices and training to raise awareness

  • 4. Identifying and assessing risks in the supply chain

    • Derivation of desired improvements from the results of on-site inspection

  • 5. Establishment of risk mitigation plan and follow-up measures

    • Ask some of the suppliers to check issues related to human rights, labor and business ethics, and take corrective actions.

  (Written Evaluation) The written evaluation is conducted via web page or e-mail. HD Hyundai XiteSolution bases the evaluation on the assumption that the answer submitted by the supplier is true, but may request relevant evidence if necessary.

  (Due Diligence) Due diligence is about visiting suppliers based on the results of written evaluations, checking actual risks, and deriving improvement plans based on it.

  (Support for Improvement) Depending on the results of written evaluation and due diligence, suppliers may be exhorted to carry out activities to improve the level of ESG. Improvements and progress may be reflected in future business relationships. Moreover, HD Hyundai XiteSolution supports suppliers' ESG improvement through win-win growth activities such as funding, technology development, establishment of the supply chain management process, and training support.

• D. Communication

  HD Hyundai XiteSolution continuously communicates with internal and external stakeholders about the supply chain ESG risk management system and its status and results. The company discloses measures to improve and mitigate supply chain ESG risks through its annual sustainability report. Through the win-win growth process with other suppliers, we regularly communicate with each other. Stakeholders, including other suppliers, share various opinions with HD Hyundai XiteSolution through the grievance handling channel.

  This Supply Chain ESG management policy will be implemented as of March 28, 2023.