Our basic policy of compliance management is that we keep the company and our officers and employees legally safe and secure by preventing their misconduct and negligence. In this respect, we keep reminding our officers and employees of the importance of compliance and put in place and operate a proper mechanism of organizational and procedural preventive measures to ensure compliance in our management and execution of duties.

We have an officer assigned to the oversight of the company’s risk management and compliance, and the administration of compliance-related affairs is mainly tasked to the department in charge of general affairs. When an issue affecting the company’s overall compliance arises, the department in charge of general affairs will check relevant laws and regulations, put in place necessary internal rules, and keep all related parties informed. If an issue affecting only one or a few specific departments, such as a technical issue, arises, it will be dealt with by the relevant departments. We make a coordinated effort within our organization.

We convene the Risk Management & Compliance Committee, which is chaired by the officer in charge of risk management and compliance, both regularly and in the event that we discover a compliance-related issue, to discuss compliance-related questions and issues and decide on preventive measures, corrective measures, and disciplinary actions.

We provide training for our officers and employees about the basics of compliance and important laws and regulations related to our business when they join the company. We also provide follow-on training regularly through e-learning. In our training, we make sure that the officers and employees understand our corporate philosophy and code of conduct and emphasize the prevention of bribery, compliance with antitrust laws and export control regulations, and information security. We also discuss our whistleblower protection system. Through these efforts, we are increasing the awareness of our officers and employees about the importance of compliance.

In the “Lasertec Code of Conduct”, we set forth our commitment to complying with laws and regulations, articles of incorporation, and social norms, and conducting fair trade and proper business activities.

We have a compliance helpline in place to receive reports and inquiries from the officers and employees of our company and overseas subsidiaries as well as from our business partners concerning human rights violations and other compliance-related issues. A third-party organization serves as the point of contact for the helpline, to which a whistleblower can report their case, either with their name or anonymously, by multiple means of communication. Whistleblowers are protected against any type of unfavorable treatment under our internal rules. We investigate the reported case in accordance with our internal rules, and if we find a violation as a result, we will take necessary corrective and preventive measures.

We have set a basic principle on the institution of an internal control system to put in place a system that ensures the proper operation of our business. The members of the Audit and Supervisory Board are responsible for the oversight and examination of the internal control system pursuant to its audit policy and schedule. They conduct audits in coordination with the Board of Directors and the department in charge of internal auditing.

The department in charge of internal auditing conducts internal audits pursuant to the company’s internal audit rules. The internal audits examine whether the company’s operation follows its rules on compliance, asset management, subsidiary management, and others. These audits are carried out regularly, at least once a year. The results of the audits are reported to the President & Chief Executive Officer and shared with the members of the Audit and Supervisory Board. The department in charge of internal auditing also audits the company’s subsidiaries in the United States, Korea, Taiwan, China, and Singapore every year. For compliance-related internal audits, the department in charge of internal auditing reviews the company’s practices in the areas of labor management, industrial waste disposal, export controls, and others regularly, at least once a year.