To strengthen the expertise of independent directors, SK D&D conducts regular training programs specifically tailored for them. In 2024, the company focused on providing training for all independent directors and Audit Committee members, with an emphasis on risk management and internal control enhancement in response to changes in the business environment. Additionally, SK D&D supports the professional development of Audit Committee members by facilitating participation in training programs offered by external expert organizations, such as audit firms and Audit Committee forums.

SK D&D appoints competent directors and protects their activities and decision-making by subscribing to Directors and Officers (D&O) liability insurance at the company's expense, which is renewed annually. In addition, independent directors may, when necessary, receive support or advice from the company’s employees or external experts at the company’s expense and may request the provision of information required for the performance of their duties from relevant company personnel. These provisions are stipulated in the company’s Governance Charter, and SK D&D actively supports independent directors in carrying out their responsibilities.

Since establishing the Independent Director Recommendation Committee in June 2021, SK D&D has safeguarded shareholders’ rights by recommending independent director candidates through this committee for approval at the general meeting of shareholders. The background, reasons for recommendation, and any potential conflicts of interest with the company are transparently disclosed in the notice of the general meeting of shareholders. The Independent Director Recommendation Committee, which is entirely composed of independent directors, excludes influence from controlling shareholders or management during the director appointment process. This ensures fairness and impartiality.

When identifying and recommending independent director candidates, the committee rigorously reviews disqualification criteria set forth in the Commercial Act and its Enforcement Decree. It also verifies candidates’ experience and expertise. The board considers a balanced composition in terms of expertise, diversity, and independence to avoid concentration in specific backgrounds or professional fields. Directors serve a fixed term of three years. The CEO nominates candidates through the HR Committee, and appointments are finalized following shareholder approval.

SK D&D ensures the independence of its board of directors by stipulating in its Corporate Governance Charter and committee regulations that each board committee must be composed of a majority of independent directors. Furthermore, to maintain fairness and independence in board decision-making, directors with conflicts of interest are restricted from exercising voting rights on matters such as remuneration determination and director candidate recommendations. In addition, SK D&D transparently discloses the composition of its board by reporting appointments, dismissals, or early resignations of independent directors to the Financial Services Commission and the Korea Exchange.

The ESG Committee plays a vital role in enhancing the company’s ESG governance at the board level by reviewing ESG management strategies and directions, regularly monitoring performance, and proposing improvements. In setting business strategies and ESG-related objectives, the committee takes into account environmental management and social responsibility policies and reviews and oversees detailed implementation plans.

The committee provides advisory functions by deliberating on key environmental management issues such as Net Zero implementation, climate change risk management, establishment of eco-friendly business directions, and greenhouse gas emissions control—ensuring these matters receive active oversight at the board level. Additionally, it identifies ESG risks and opportunities throughout the entire business value chain and develops and executes frameworks to address them effectively. The ESG Part, as the company’s ESG operational unit, conducts materiality assessments to identify key sustainability issues, including their impacts, risks, and opportunities. It reports best practices and improvement plans to the ESG Committee. To establish and implement targeted improvement initiatives, the ESG Part collaborates with relevant departments across environmental, social, and governance areas and regularly shares progress and results with the ESG Committee.

Regulations of the ESG Committee

The HR Committee assumes the comprehensive functions of the Compensation Committee by reviewing matters such as the evaluation and reappointment of the CEO, and the appropriateness of compensation for executive directors. It also receives reports on the evaluation and compensation results of key executives. Furthermore, the HR Committee evaluates the CEO’s management activities and performance, and monitors the fulfillment of KPIs by the CEO and key executives. Through these efforts, it supports the management team in carrying out their duties with a strong sense of responsibility toward ESG management.

Regulations of the Nomination and Compensation Committee

The Audit Committee oversees all audit-related responsibilities, including financial audits, the appointment of external auditors, and evaluations of the internal control over financial reporting (ICFR) system. It also functions as a supervisory body for ethical management and anti-corruption efforts. To ensure independence, the committee is composed entirely of three independent directors who meet the eligibility requirements stipulated under the Commercial Act. The committee chair is appointed based on expertise in accounting and finance. To strengthen the committee’s audit capabilities, monthly training sessions are held on relevant laws such as the Act on External Audit and internal control systems. The Internal Control Part supports the committee’s operational tasks, while regular communication with external auditors is maintained to facilitate effective oversight.

Regulations of the Audit Committee

The Independent Director Recommendation Committee is composed entirely of independent directors to ensure fairness and independence in the nomination and operation of independent directors, in accordance with relevant provisions of the Commercial Act and the company’s Independent Director Recommendation Committee Regulations. The committee holds the authority to recommend candidates for independent directorships to be appointed at the general shareholders’ meeting. To this end, it conducts preliminary reviews and verifications to ensure candidates have no disqualifying factors, possess relevant expertise, and maintain no significant conflict of interest with the company or its affiliates.

Regulations of the Independent Director Recommendation Committee