POSCO operates many types of systems for fundamental solutions to and prevention of corruption. In addition, regulations and systems are steadily being supplemented so that efforts do not stop at mere ethical standards announcement and effective and realistic implementation is realized instead.
- Whistleblowing compensation system
- The company started operating the whistleblowing compensation system in September 2004 to shun paternalism as well as the attitude of not taking things seriously – which may still remain at the company -- to create a culture that practices corporate ethics by activating whistleblowing.
Acts subject to whistleblowing include exchanging money or goods between interested parties and company staff in relation to business, obtaining unfair profits or causing damage, through the use of job and position, interfering with another employee’s fair performance of duties for personal profits or those of other persons, and committing unethical acts related to other outside persons. Up to KRW 50,000,000 may be offered as a reward. To operate the system realistically, the social status of the whistleblower must be guaranteed. Accordingly, POSCO has stipulated that persons disclosing the identity of the whistleblower will be punished. Attempts to look for or make inquiries as to the identity of the whistleblower are also prohibited. If the identity of the whistleblower is revealed, and if the whistle-blower so desires, he/she may be assigned to the auditor’s office or Corporate Ethics Practice Bureau where his/her status can be protected.
At the same time, to prevent the identity of the whistleblower from being exposed, the company prescribes that no personal information of the whistleblower will be recorded in related documents and minimizes the reporting and receiving channels. As further guarantee of the social status of the whistleblower, the directors and employees of the operating department held a “Whistleblower’s social status guarantee pledging ceremony” and took other necessary measures. - Ethics presentation meeting for new customers –Special provisions on ethics practice
- To enable it to restrict the trading volume, stop transactions, or take other equivalent actions in case customers violate the ethics practice norms, POSCO has established the required systematic devices. In other words, it has created an atmosphere for strengthening the will to practice ethical management and promoting transparent and fair transactions.
According to the special provisions on ethics practice, unethical acts may be converted into monetary amounts. If the amount is less than KRW 500,000, the trading volume may be restricted, or the related agreement may be canceled. If the amount exceeds KRW 500,000 but is less than KRW 1,000,000, the relevant agreement and/or similar agreement will be terminated; if the amount exceeds KRW 1,000,000, all agreements will be terminated. A customer involved in any of these acts will be subject to restrictions in all transactions or biddings.
If required by new POSCO customers, corporate ethics presentation meetings are given individually at the places and dates preferred by the new customers in Pohang, Gwangyang, or Seoul.
Participants shall be the representative (or directors or employees selected by the representative) of new customers. Subjects of education, which lasts for approximately 1 hour, include “POSCO’s need for ethical management, constituents of ethical standards, and practice of corporate ethics” and introduction of related systems such as the “special provisions on ethics practice”, the “whistleblowing compensation system.”
Since new customers can share the philosophy of POSCO’s ethical management within a short period of time through such presentation meetings, POSCO can ultimately prevent unethical acts; thus providing itself with an opportunity to solidify the win-win partnerships with interested parties. - Gift return center and in-house online auction
- As one of the typical cases disseminated widely to domestic enterprises, the gift return center has created a sensation after being introduced for the first time by POSCO.
The gift return center was introduced at the suggestion of an employee. When gifts are received from interested parties on festive days, they are returned at the company expense to the interested parties with a sticker explaining politely the intention of the gift returning. POSCO started operating the center after Chuseok (Thanksgiving day) 2003 when the ethical standards were proclaimed. Even when gifts are received from interested parties on normal days, those whose values exceed customarily acceptable levels are returned to interested parties at any time by the gift return center or may be donated to social organizations.
Among the gifts received by the gift return center, gifts whose senders are uncertain or those that cannot be donated to social organizations are gathered and placed on the in-house online auction. The proceeds obtained from the auction are used as social service funds. - Standard for outside lectures given by directors or employees
- POSCO has been operating the “Standard for giving outside lectures” since July 2005. The standard stipulates that the money received by a director or an employee giving a lecture outside the company using the knowledge acquired in the line of duty be used as social service funds.
This is the practice of the principle of “Distinguishing between public and private,” wherein the money received for giving outside lectures using the knowledge acquired in the line of duty is regarded as a company asset. In addition, the company operates external lectures based on a specified procedure to ensure positive impacts on information security.
As per the standard for giving outside lectures, remuneration for lectures is not received from public institutions or interested parties considering public value or mutual growth. If the institutions requesting lectures are profit-making institution or other ordinary enterprises without any relation with the company, however, lecture fees are collected. Even in such case, the lecture fees are returned to POSCO.
If the lecturer designates the place of donation, the lectures fees shall be donated to the designated institution; otherwise, the money shall be deposited as social service funds through the social service department and periodically donated by the company.