Preface

Lotte Chilsung Beverage Co., Ltd. (hereinafter the Company) strives to contribute to the affluent life of mankind by providing products and services that are loved and trusted

As a company that is loved by the people and fulfills its social responsibilities, the company aims for continuous growth of company values.

The company enacts the following corporate governance charter to establish a sound governance structure that is the basis for sustainable growth, and intends to operate a system of mutual checks and balances by securing fairness, transparency, and independence in the governance structure.  

Article 1 Rights of Shareholders

① Shareholders have basic rights, such as the right to participate in profit distribution, and the right to attend and vote at the general meeting of shareholders, as stipulated by the Commercial Act and related laws.
② Matters that bring significant changes to the existence of the company and shareholder rights must be decided in a way that guarantees the rights of shareholders to the maximum.
③ The company shall determine the date and place of the general meeting of shareholders so that shareholders can participate as much as possible, and provide information on the date, place, and agenda of the general meeting of shareholders in advance of sufficient time.
④ Shareholders may propose agenda items at the general meeting of shareholders in accordance with relevant laws such as the Commercial Act, and may inquire about the agenda and request explanations at the general meeting of shareholders.
 

Article 2 Fair Treatment of Shareholders

① Shareholders have one voting right for each common share. However, voting rights for specific shareholders may be restricted as prescribed by law.
② The company shall provide necessary information to shareholders in a timely, fair and sufficient manner. In addition, even if information that is not subject to disclosure is disclosed, it is provided equally to all shareholders.
③ The company protects shareholders from unfair insider transactions and self-transactions by other shareholders such as controlling shareholders.
 

Article 3 Responsibilities of Shareholders

① Shareholders must recognize that the exercise of their voting rights may affect the management of the company and strive to actively exercise their voting rights for the development of the company.
② The controlling shareholder who exerts influence over the management of the company shall act for the benefit of the company and all shareholders, and shall endeavor not to cause damage to the company and other shareholders through actions contrary to this.  

Article 4 Functions of the Board of Directors

① The board of directors has comprehensive authority over the management of the company and shall perform the functions of decision-making and management supervision of the company.
② The board of directors may delegate authority to the representative director or a committee within the board of directors. However, important matters stipulated in laws, the articles of incorporation, or the regulations of the Board of Directors are excluded.
 

Article 5 Composition of the Board of Directors and Appointment of Directors

① The board of directors must be of a size that allows for effective and thoughtful discussion and decision-making, and must consist of a sufficient number of directors to activate the committees within the board of directors.
② The board of directors shall have outside directors who can function independently from the management and controlling shareholders, and the number shall consist of at least three and a majority of all directors so that the board of directors can maintain practical independence.
③ The board of directors should be composed of competent persons with expertise to make substantial contributions to corporate management, and the term of office of the appointed directors shall be guaranteed unless there is a separate reason for disqualification.
④ The company strives to promote the diversity of the board of directors in order to respond flexibly to changes in the business environment based on various perspectives and experiences.
⑤ The company shall allow shareholders to exercise their voting rights with sufficient information and time to judge the candidates for directors.
 

Article 6 Operation of the Board of Directors

① The Board of Directors holds regular meetings, and if necessary, temporary meetings of the Board of Directors are held from time to time.
② For the smooth operation of the board of directors, there are rules for the board of directors that stipulate the authority, responsibilities, and operating procedures of the board of directors.
③ The company prepares, maintains, and keeps the minutes of each meeting.
④ The company discloses the details of each director's activities, such as the attendance rate of the board of directors and whether each director agrees or disagrees with the major agenda items to be disclosed.
⑤ Directors may participate in the Board of Directors meetings by using telecommunication means.
 

Article 7 Committees within the Board of Directors

① The board of directors may establish a committee to perform specific functions and roles within the board of directors for quick and efficient decision-making.
② The composition, operation, and authority of all committees shall follow the regulations of each committee separately determined.
③ The committee shall report the resolutions to the board of directors, and the board of directors may re-resolve matters resolved by the committee.
 

Article 8 Duties of Directors

① Directors shall perform their duties according to their duty of care and faithfulness as a good manager.
② Directors shall not exercise their authority for the benefit of themselves or a third party, and shall always pursue the results that are in the best interests of the company and shareholders.
③ Directors shall not divulge any company secrets they have learned in connection with the performance of their duties to the outside, or use them for their own or third party interests.
 

Article 9 Responsibilities of Directors

① If a director violates laws or the articles of incorporation or neglects his/her duties and causes damage to the company, the director shall be liable for damages to the company. If a director has malicious intent or gross negligence, he/she shall also be liable for damages to a third party.
② In the process of making business judgments, if a director has collected and thoroughly reviewed substantial and reliable data and information, and performed his duties in a manner deemed in the best interest of the company based on his sincere and reasonable judgment, such The management judgment of directors should be respected.
③ The company may purchase liability insurance for directors at the expense of the company in order to ensure the effectiveness of the investigation of directors and to recruit competent persons as directors.
 

Article 10 Outside Directors

① Outside directors independently participate in the company's major decision-making through the activities of the board of directors, and as a member of the board of directors, they supervise and support the management.
② Outside directors are appointed at the general shareholders' meeting based on the recommendation of the Outside Director Candidate Recommendation Committee, and the committee must be structured to ensure fairness and independence of the director candidates.
③ Outside directors may request the provision of information necessary for the performance of their duties. In addition, if necessary, an external expert may be consulted through an appropriate procedure, and the company will support the necessary expenses.
④ The company regularly reports or provides management information such as the company's business execution status so that outside directors can accurately understand the company's management status in a timely manner, and provides and operates continuous education or training programs for outside directors.  

Article 11 Evaluation and Compensation

① The management activities of the board of directors shall be evaluated fairly, and the results shall be appropriately reflected in the remuneration.
② To improve the effectiveness of the board of directors, evaluation of the board of directors and outside directors is carried out regularly.
③ The board of directors decides whether or not to pay directors' remuneration or expenses necessary for business within the limit of payment determined by the resolution of the general meeting of shareholders.
④ Director's remuneration must maintain a reasonable proportional relationship with his/her duties, be determined at an appropriate level in light of the company's financial condition, and be consistent with the long-term improvement of the company's and shareholders' profits.
⑤ The board of directors may delegate matters pertaining to remuneration, such as the limit of remuneration of registered directors, to the remuneration committee.  

Article 12 Audit Committee

① In order to maintain independence, the audit committee is composed of all outside directors, and at least one of the members must be an expert in accounting or finance.
② The Audit Committee conducts a legal inspection of the business activities of directors and management, a soundness and validity inspection of the company's financial activities, a review of the accuracy of financial reports, approval of the appointment and dismissal of external auditors, and a follow-up report at the general shareholders' meeting, etc. do.
③ The Audit Committee may inspect or copy accounting-related book records and documents at any time, and may request a director to report on business or investigate the business and property status of the company.
④ If necessary, the audit committee may request advice from external agencies and experts at the company's expense.
 

Article 13 External Auditor

① The company ensures that external auditors maintain legal and practical independence from the company, management, and controlling shareholders.
② The external auditor attends the general meeting of shareholders and explains if there are any questions from shareholders regarding the audit report.
③ The external auditor checks whether there is any information that contradicts the audit results among the audited financial statements and regularly disclosed information.
④ The external auditor shall make an effort to check whether the company has acted illegally or not during the audit.
⑤ External auditors should consider the viability of the company as required by relevant laws such as the 「Act on External Audit of Stock Companies」.
⑥ The external auditor reports important matters identified during external audit activities to the audit committee.  

Article 14 Protection of Rights of Stakeholders

① The company strives to grow together by sharing greater value with various stakeholders such as customers, employees, and partners.
② The company respects the rights of workers and improves the quality of life of workers.
③ The company values ​​cooperative relationships with partners, promotes the establishment of a fair market order through compliance with fair trade laws, and promotes the balanced development of the national economy.
④ The company shall comply with the creditor protection procedures for matters such as mergers, reductions, and divisions that significantly affect the creditor's status.
⑤ When a stakeholder holds the position of a shareholder, all rights as a stakeholder and a shareholder shall be protected.
⑥ The company provides information necessary to protect the rights of stakeholders within the scope permitted by laws and regulations and contracts with third parties, and supports stakeholders' access to relevant information.  

Article 15 Disclosure

① The company prepares and discloses business reports, quarterly reports and semi-annual reports on a regular basis, and discloses information related to the company to shareholders and stakeholders faithfully, promptly and honestly.
② In addition to the disclosures required by laws and regulations, the company shall timely, in detail and accurately disclose matters that may or may materially affect the decision-making of shareholders and stakeholders.
③ The company strives to make the disclosure contents easy to understand and to make it easy for stakeholders to use.
④ The company must designate a person in charge of disclosure, and has an internal information delivery system that allows important information of the company to be delivered to the person in charge of disclosure promptly.
⑤ The company does not give preference to or discriminate against specific persons in the scope or timing of disclosure of important corporate information, and discloses it so that all stakeholders can access it at the same time.
 

Article 16 The market for enterprise management rights

① Acts that cause changes in the management rights of the company, such as mergers, acquisitions, division of the company, and transfer of important business, must be done through transparent and fair procedures.
② The act of defending the management right of the company must not be done in a way that sacrifices the interests of the company and shareholders in order to maintain the management right of some shareholders or the management.
③ The company shall allow shareholders who oppose major structural changes, such as mergers and transfers of important business, to exercise their right to purchase stocks at a fair price that reflects the real value of their shares as prescribed by law.