Compliance

COMPLIANCE

Today, companies face a strong social demand for social contribution through coexistence and transparent moral management, not to mention legal compliance including fair trade and anti-corruption. In this spirit, American Precoat devotes efforts to establish a fair and transparent trading relationship through the establishment of a compliance system.

Compliance System

In response to demands, American Precoat established a compliance management infrastructure that meets global standards to execute the expansion of a culture of compliance. management in accordance with the group’s reinforced policy for compliance management. We have also established a Compliance Team, dedicated to enterprise legal management, and completed formation of a compliance system. American Precoat aims to manage overall compliance risks, protect the core values of the group and the company, specify the need for compliance and ethical management to members through the establishment of a compliance system that meets global standards, and ensure its effective operation, firmly establishing it as corporate culture.

Establishing Compliance System

The compliance system established by American Precoat in 2022 includes guidelines in the manual to prevent various legal risks, a checklist handbook, strengthened internal compliance regulations and approval procedures, a preliminary monitoring system, and a self-check system. The newly established Compliance Team serves to assist the Fair Trade Self-Compliance Manager appointed pursuant to Fair Trade self-compliance. The Compliance Officer appointed pursuant to the Compliance Control standard performs company- wide compliance training on a regular basis, examines the compliance status, and reports these results to the Board of Directors.</p><p>Grounded on these efforts, we comply with the laws and regulations, operate our company to meet legal and social requirements, create a corporate culture. rooted on doing what is right for the company at all times, and make sure our corporate culture remains so.

Strengthening Compliance-related Programs

After carefully comparing and reviewing the requirements demanded by domestic and overseas compliance standards, American Precoat introduced new compliance activities, successfully securing system integrity. In addition, we enhanced the efficiency by integrating, complementing, and strengthening existing compliance-related duties which were carried out sporadically. We also introduced an IT system for efficient compliance monitoring and operation. Moreover, we established a system of compliance-related laws and regulations, continuously updated the system, and introduced a monitoring system for employee compliance activities, and a self-inspection system for working-level. departments, and the management, reporting, and storage of monitoring and inspection data. In addition, we execute a wide range of activities such as strengthening fair trade business management and compliance education, expanding compliance advisories such as fair trade and anti-bribery, and reinforcing external evaluation indicators.

Mid-to Long-term Reinforcement Plans for Compliance

American Precoat is establishing and undertaking a mid-to long-term master plan aimed at achieving sustainable growth and global compliance management to become a leading company. Notably, we plan to implement the international certification of anti-bribery management systems. (ISO 37001) next year by dutifully undertaking the relevant programs through the newly established Compliance System.

Strengthen Compliance with Subsidiaries and Overseas Subsidiaries

American Precoat conducts compliance training for managers at subsidiaries and overseas corporations. In the future, we plan to use our compliance system as a standard model to disseminate compliance systems to subsidiaries and spread a culture of compliance management. Based on the domestic model, a compliance system model produced in the respective local languages will be established in accordance with the laws and regulations of major
countries such as the USA, China, EU and other international standards so that it can be applied. further to operations overseas.

Strengthening Supply Chain Compliance

American Precoat established a Code of Conduct for the Integrity of Suppliers in 2022 and has been undertaking it ever since. We continuously reinforce our supply chain compliance by requiring use of standard contracts and expanding the ECS (Electronic Chart Systems) for transparent and fair. transactions with our partners. In 2022, in particular, we completed the anti-corruption management system to comply with anti-graft laws including the Anti-Corruption and Bribery Prohibition Act both at home and abroad, with a plan to acquire the relevant international certificate. Next year, we will further. strengthen our supply chain compliance by adding reciprocal obligations to comply with anti-bribery and other relevant laws and regulations in the contracts, while expanding training to create a transparent and fair trading culture for our supplier’s employees.