Ethical Management

Lotte makes its decisions based on its corporate mottos of "Customer-centered Thinking," "Pursuit of Originality," and
"Quality First," and is dedicated to fulfilling its societal responsibilities and seeking the
common interests of its stakeholders and society while at the same time aspiring to become a premier global company.
To this end, Lotte has announced its Code of Ethics, which has its management’s and employees' full commitment.

• 01 General provisions
  • Article 1 [Purpose] These regulations aim to accelerate the ethical management activities by setting the standards of the proper acts and value judgment of Lotte Shopping and the matters related to the afore-mentioned objectives.
  • Article 2 [Application scope] These regulations aim to accelerate the ethical management of the Company.
  • Article 3 [Definitions]
    1. ①Money and valuables: benefits from money and valuables, marketable securities, goods, and other financial benefits.
    2. ②Entertainment and foodstuffs: benefits, including meals, drinks, sports, and entertainment.
    3. ③Convenience: accommodation, provision of transportation, tour guides, and event support, except for money and valuables or treatment and reception from others. It also indicates generation of financial loss to the other party in general for the comfort of a recipient.
    4. ④Generally accepted action according to social norms: an action that was taken voluntarily as an innocent gesture, that was recognized as social custom without expectation of reciprocation, and that has no other measures or methods available. It is assumed that an amount in excess of KRW 50,000 on a one-time basis or in excess of KRW 500,000 annually is an action that cannot be accepted according to social norms.
    5. ⑤Stakeholder: the individual or group in and out of the company that is affected by the act or decision-making of partner companies and their board members.
    6. ⑥Business Partner: the individual or group that is interested in the relationships with partner companies in terms of trade.
    7. ⑦Whistleblower: the employees, partner companies, and customers that are obliged to report in case of receiving money, gifts, or entertainment, and reception or recognition thereof.
• 02 Pledge to the customers

  We will prioritize our customers, respect customer opinions, act with sincerity, and continue creating new values based on our customers’ perspectives so as to win their endless trust.

  • Article 4 [Customer Respect] We will always listen respectfully to customers’ opinions, actively address the customers’ valid demands, and think from the perspective of our customers when making all decisions and actions.
  • Article 5 [Customer Satisfaction] We will embody the spirit of customer respect to maximize customer satisfaction.
    1. ①We will always welcome our customers with a clean appearance and attire, and serve them in a modest and sophisticated manner.
    2. ②We will kindly and sincerely answer all phone calls from our customers.
    3. ③We will always handle our customers’ business with the utmost priority.
    4. ④We will clarify all details that affect the customers’ interest, and create printed materials that facilitate customer understanding.
    5. ⑤We will maintain a pleasant and clean facility and business environment for the convenience of our customers.
    6. ⑥We will swiftly take care of valid requests for exchanges or refunds by our customers.
    7. ⑦We will address customer complaints and suggestions in a swift and accurate manner.
  • Article 6 [Customer Trust] We will serve our customers with sincerity, to become a well-recognized and trusted corporation.
    1. ①We will always treat our customers with sincerity and keep all promises to our customers.
    2. ②We will not provide customer information to a third party for any purpose other than business operations without the prior approval of our customers.
    3. ③We will seek diverse methods to facilitate communication with our customers.
• 03 Responsibility and Obligation on Shareholders

  We will raise the market value of our shares through honest management based on righteousness, innovation, and transparency.

  • Article 7 [Open, Honest, and Principled Management] All employees will adhere to the company’s articles of incorporation, company rules, and relevant laws to carry out honest management and improve company value.
  • Article 8 [Transparency Maintenance] The management documents will adhere to the general principles of business management and will be properly prepared and distributed according to the business accounting standards.
  • Article 9 [The Right to Know Among Shareholders] We will respect the shareholders’ right to know and respect their valid requests or suggestions.
• 04 Basic Ethics of Employees

  The employees of Lotte Shopping will always prioritize customer value and pursue a customer-oriented, fair, and respectful corporate culture based on customer trust. Based on this ideology, we will exert our utmost efforts to uphold the company’s reputation and individual workers' dignity through adherence to relevant laws, social regulations, and ethical values. We will also sincerely fulfill our responsibilities and obligations as employees and use mutual respect, a positive attitude, and creativity to contribute to the development of the company

  • Article 10 [Observation of Regulations] Employees will refrain from all actions that go against relevant laws, company regulations, social regulations, and ethical values.
    1. ①We will strictly adhere to all relevant laws to avoid criminal prosecution.
    2. ②We will conduct our work operations fairly and ethically, and adhere to company regulations and relevant laws.
    3. ③We will refrain from unethical and illegal activities in our daily lives and work operations.
    4. ④We will always maintain a clean appearance and confident attitude, and refrain from taking any action that may arouse contempt from others.
    5. ⑤We will not take any form of financial gain such as acceptance of money, gifts, treats, or entertainment that hinder the fairness of work. However, socially accepted forms of gain are permitted.
    6. ⑥We will adhere to the relevant laws and regulations on transparency in undertaking all financial and fiscal operations.
    7. ⑦We will refrain from sending invitations during company events to supplier companies, so as to not impose pressure for attendance or gifts. Furthermore, we will refrain from unduly advising suppliers of family events of employees refrain from imposing pressure.
    8. ⑧We will not use company assets for personal reasons, and will refrain from disclosing confidential company information to external parties.
    9. ⑨All executive members will keep close consideration of CSR when responding to opportunities and risks, and will serve as leaders in the industry by acting in accordance with internationally prescribed business management practices.
    10. ⑩To prevent sexual harassment in the workplace, the company will conduct at least 1 annual sexual harassment prevention training course, which needs to be attended by all employees. When any harassment occurs, strong measures will be taken.
        • ①Employees must refrain from causing sexual humiliation or emphasizing pre-established gender roles.
        • ②Employees must refrain from lewd jokes and extensive drinking or dancing during get-togethers.
        • ③Employees must refrain from watching pornographic materials during work through the internet, computer, or other media.
        • ④Employees must not make sexual evaluations or comparisons related to a coworker’s physical appearance.
        • ⑤Employees must refrain from intentional or unnecessary physical contact.
    11. ⑪Employees will refrain from using illegal computer software.
    12. ⑫We will not engage in any activities that may be deemed unethical in an objective assessment.
    13. ⑬All employees of Lotte Shopping shall refrain from using their rank or work authority to acquire confidential management secrets or unannounced information for personal gains through share trades, or leak the information to an external party.
  • Article 11 [Good Faith] We will give our best to sincerely complete all tasks for which we are responsible, and will engage in our work with honesty and fairness,
    1. ①Employees should undertake the roles assigned to each individual according to the company’s management ideology.
    2. ②Employees should prevent any risk that may arise as a result of his/her decision-making or action, and take full responsibility in case of trouble.
    3. ③Employees should work hard to guarantee active inter-departmental cooperation and communication with colleagues.
    4. ④Providing financial payments or gifts among employees is strictly prohibited with the following exceptions:
       • ①Voluntary financial payment of gift by a superior to a subordinate;
       • ②Giving gifts for birthdays and other special anniversaries through personal funds;
       • ③Giving gifts purely as a way of expressing gratitude, with no expectations of a reciprocal action or gift.
    5. ⑤Celebratory payments among employees during family events should be voluntary and in accordance with social customs.
    6. ⑥Borrowing of money among employees is strictly prohibited. If lending is necessary, permission must be given by the superior of the lender prior to the lending activity.
    7. ⑦Employees should refrain from standing as guarantor for each other. However, for company loans offered as part of the company’s welfare project, employees may stand as guarantor for one another with the approval of their superiors.
    8. ⑧Employees should not receive any form of gain, including money and goods or entertainment, in exchange for an unethical favor.
    9. ⑨When the application of these provisions causes a conflict of interest between the company and the individual, priority should be given to the communal interests of the company.
  • Article 12 [Mutual Respect] We will respect the individual value and inherent dignity of each person, and make our best efforts to create a healthy and happy work life.
    1. ①Employees will refrain from any actions that veer away from basic etiquette.
    2. ②Employees will refrain from impolite actions or arrogant comments that offend suppliers and coworkers.
    3. ③Employees will take care to maintain a clean appearance and confident attitude, and refrain from any action that may arouse contempt.
    4. ④Employees will refrain from giving preferential treatment based on education, gender, religion, age, and place of origin.
    5. ⑤HR management will strive to prevent complaints regarding HR management policies, such as promotions and transfers, through continuous monitoring and feedback.
    6. ⑥⑥ The company will exert additional efforts to improve the quality of work life.
  • Article 13 [Ability Development] Based on the extensive knowledge and expertise of our workers, we take pride in being a productive Lotte member and are committed to maintaining those strengths.
    1. ①We will always work toward self-improvement, to lead Lotte Shopping to a global level.
    2. ②Superiors will provide constructive guidance and advice to their subordinates’ regarding their character and abilities, and the subordinates will improve their ability to conduct their individual work responsibilities.
    3. ③The company will provide equal opportunities for training programs that are designed to improve creative thinking and autonomous work capabilities.
    4. ④All tangible and intangible knowledge acquired during work operations should be shared between all employees so as to help develop the company.
• 05 Proper Relationship with Business Partners

  We will reinforce mutual trust and cooperation through transparency and fair trade, so as to pursue mutual growth in the free market competition.

  • Article 14 [Fair Trade]
    1. ①Under the principles of free competition, we will guarantee equal opportunities for participation and ensure equitable provision of information necessary for transactions so as to realize mutual benefits.
    2. ②All transactions will undergo sufficient negotiations under the principle of reciprocity so as to ensure fair trade.
    3. ③We will not unilaterally make alterations to the conditions and procedures of the transactions that may bring harm to suppliers without prior negotiation with the suppliers.
    4. ④We will not take part in any action deemed unethical by the fair trade regulations, including antitrust and anticompetitive behavior.
  • Article 15 [Pursuit of Mutual Development]
    1. ①We will view our suppliers as business partners and maintain equal positions in contracts, and give our best efforts to improving mutual cooperation.
    2. ②We will help improve our suppliers’ competitiveness and strive for mutual development.
    3. ③We will spread and promote the company’s Code of Ethics and Ethics and Conduct Regulations to the suppliers so as to encourage their active participation.
  • Article 16 [Prohibition of Non-Ethical Acts with Business Partners]
    1. 1.We will not receive any money, goods, foodstuffs, entertainment, or convenience-oriented treatment from our suppliers for any operations related to our work. However, socially accepted customs are permitted.
    2. 2.Other prohibited and non-ethical acts
       • ①Substitute payments of card bills, credits, loans, and other financial obligations by the supplier for any work-related operation is prohibited. Receiving guarantorship for loans and movable assets, and other real estate, shares, sales, membership, and other asset-related gains are prohibited.
       • ②Employees should not borrow money from suppliers.
       • ③Employees should not lease or borrow assets or receive collaterals from suppliers in any work-related operation for personal convenience or gain.
       • ④⑤ Employees are prohibited from buying from the suppliers any movable assets or real estate assets at a lower-than-market value price for practical gain.
       • ⑤Employees are prohibited from taking non-ethical actions against suppliers for other operations.
• 06 Social and National Responsibility

  By constantly reminding ourselves that the company exists only on top of a stable foundation in our country and society, we will promote healthy business practices to develop the company and create social wealth, so as to contribute to bringing a bountiful life for the people and social development for the country.

  • Article 17 [Sound Business Activity] We will respect social values by undertaking practical and healthy business activities.
    1. ①We will reject all irregularities that hinder stable business activities.
    2. ②We will do our best to fulfill our CSR through education, culture, scholarship, and welfare projects.
    3. ③We will encourage employee participation in volunteer projects and contribute to social development.
    4. ④We will humbly respect and listen to the demands of customers at all levels of society.
    5. ⑤We will continue to create new jobs so as to contribute to the country’s development.
    6. ⑥We will respect and operate in accordance with internationally recognized conventions based on the Universal Declaration of Human Rights (UDHR) in all our activities.
  • Article 18 [Non-Political Intervention] Lotte Shopping will refrain from meddling in politics.
  • Article 19 [Environmental Friendliness] We will continue to implement activities aimed at preserving the earth and will exert our utmost efforts for saving the environment.
    1. ①We will follow environmental regulations and actively partake in preventing climate change and reducing greenhouse gases.
    2. ②We will build the necessary facilities to prevent pollution and improve the environment, and properly manage these facilities.
    3. ③We will protect the living environment of the region from our business activities and give our best to the creation of a pleasant environment for local residents.
  • Article 20 [Safety Management and Accident Prevention] Lotte Shopping believes that the protection and safety of our employees, workers dispatched from suppliers, and customers is a crucial management requirement with which all companies should comply. The Lotte Shopping personnel will ensure strict safety management for customers and will do their best to follow all regulations regarding accident prevention.
    1. ①In case of an accident, the company will take swift measures that prioritize the safety of customers and local residents.
    2. ②The company will offer comprehensive education and training courses to its employees regarding safety handling as well as accident and disaster prevention, and will adhere to all safety regulations.
    3. ③The company will conduct regular evaluation of various facilities (elevator, escalator, etc.) and make best efforts to prevent accidents caused by fire or gas.
• 07 Supplementary Provisions
  • Article 1 [Period of Execution]
    1. ①These provisions came into effect on January 1, 2001.
    2. ②These provisions were enacted and put into effect on May 1, 2010.
    3. ③These Regulations shall be implemented on June 1, 2012.
  • Article 2 [Prohibition of Retroactivity] These provisions are not applicable to unethical behaviors conducted prior to the effective date.
  • Article 3 [Installation and Operation of an Ethics Management Committee]
    1. ①The company will install an Ethics Management Committee to assess and implement the company’s Code of Ethics and the ethics and conduct regulations, and will establish an ethics office to support the committee work.
    2. ②The operations of the Ethics Management Committee will be detailed in a separate regulation.
  • Article 4 [About Report] For all actions that do not fall directly within these provisions, an employee should report the action prior to or right after its occurrence. Reporting and handling procedures will be detailed in a separate regulation for the Ethics Management Committee.
  • Article 5 [Operation of Whistleblowing System and Protection of Whistleblowers]
    1. ①For any items that may damage the company, all personnel of Lotte Shopping should report to the department in charge (Lotte Shopping ethics headquarters) regardless of the severity of the situation, and these internal reports should be processed anonymously.
    2. ②No department staff and administrators working for the internal report system should reveal the identity of the whistleblower, and there should be no consequences or unfair treatment as a result of the reporting.
  • Article 6 [Reward and Punishment]
    1. ①Those with the biggest contribution to the ethics management activities may be rewarded at the discretion of the Ethics Management Committee, and the reward standard and procedures will follow similar procedures in the company’s internal regulations.
    2. ②Violators of the Code of Ethics and the ethics and conduct regulations will be sanctioned at the discretion of the Ethics Management Committee, and the details of the severity of the disciplinary action or penal measures will depend on the company’s internal regulations.
  • Article 7 [ Standard of interpretation ]
    1. ①This provision takes priority over all regulations applied to the company with the exception of the articles of association and the Code of Ethics.
    2. ②Measures not included in the provision or disputes in interpretations of the provision will be submitted to the Ethics Management Committee for interpretation and decision making.
  • Article 8 [Revision] Renewal of the application of this provision will follow a decision by the board.