LOTTE SHOPPING IR

Article 1 [ Purpose ]
This regulations aims to accelerate the ethical management activities by setting the standards of the proper acts and value judgment of Lotte Shopping Co., Ltd. and the matters related to the afore-mentioned objectives.

Article 2 [Application scope ]
This regulations aims to accelerate the ethical manage

Article 3 [ Application scope ]
① It indicates the benefits from money and valuables, marketable securities, goods, and other financial benefits.
② It indicates benefits, including treats, reception, meal, drinks, sports, entertainment, etc.
③ It indicates accommodation, provision of transportation, tour guide, and event support except

for money and valuables or treatment and reception from others. It also indicates generation of financial loss to the other party in general for the comfort of a recipient.

④ It indicates a case that has no measure or method available except for the following;

a general case that is socially acceptable, a case that was conducted voluntarily as an innocent gesture, and a case that was recognized as social custom without mutual burden. It is assumed that the amount exceeding 50 thousand won each time or the total amount exceeding 500 thousand won annually is a case that cannot be accepted in terms of a socially common notion.

⑤ It indicates the individual or group in and out of the company that is affected by the act or

decision-making of partner companies and their board members.

⑥ It indicates the individual or group that is interested in the relationship with partner companies

in terms of trade.

⑦ It indicates the employees, partner companies, and customers that are obliged to report in

case of receiving money, gift, entertainment, and reception or recognition thereof.

We will prioritize our customers, respect customer opinions, act with sincerity, and continue creating new values based on our customers’ perspectives so as to win their endless trust.

Article 4 [ Customer respect ]
We will always courteously listen to customer opinions, actively address the customers’ valid demands, and think from the perspective of our customers when making all decisions and actions.

Article 5 [ Customer satisfaction ]
We will embody the spirit of customer respect to maximize customer satisfaction.
① We will always welcome our customers with a clean appearance and attire, and serve them

in a modest and sophisticated manner.

② We will answer kindly and sincerely to all phone calls of our customers.
③ We will always handle our customers’ business with the utmost priority.
④ We will clarify all details that affect the customers’ interest, and create printed materials that

facilitate customer understanding.

⑤ We will maintain a pleasant and clean facility and business environment for the convenience

of our customers.

⑥ We will swiftly take care of valid requests for exchanges or refunds by our customers.
⑦ We will address customer complaints and suggestions in a swift and accurate manner.

Article 6 [ Creation of customer trust ]
We will attend our customers with sincerity to rise as a well-recognized and trusted corporation.
① We will always treat our customers with sincerity and keep all promises to our customers.
② We will not provide customer information to a third party for any purpose other than business

operations without the prior approval of our customers.

③ We will seek diverse methods to facilitate communication with our customers.

We will raise the market value of our stocks through sincere management based on righteousness, innovation, and transparency.

Article 7 [ Customer respect ]
All employees will adhere to the company’s articles of association, company rules, and relevant laws to carry out sincere management and improve company value.

Article 8 [ Transparency maintenance ]
The management documents will adhere to the general principles of business management and will be properly prepared and notified according to the business accounting standards.

Article 9 [ The right to know among the stockholders ]
We will respect the stockholders’ right to know and respect their valid requests or suggestions.

The employees of Lotte Shopping Co., Ltd. will always prioritize customer value and pursue a customer-oriented, fair, and bright corporate culture based on customer trust. Based on this ideology, we will exert our utmost efforts to uphold the company’s reputation and individual workers' dignity through adherence to positive law, social regulations, and ethical values. We will also sincerely fulfill our responsibilities and obligations as employees and use mutual respect, active attitude, and creativity to contribute to the development of the company

Article 10 [ Observation of regulations ]
Employees will refrain from all actions that go against positive law, company regulations, social values, and conscience.
① We will strictly adhere to the positive law to avoid criminal prosecution.
② We will conduct our work operations fairly and ethically, and adhere to the company

regulations and relevant legal regulations.

③ We will refrain from unethical and illegal activities that deserve social criticism in our daily

lives and work operations.

④ We will always maintain a clean appearance and confident attitude, and refrain from taking

any action that may arouse contempt from others.

⑤ We will not take any form of financial gain such as acceptance of money, gifts, treats,

and entertainments that hinder the fairness of work. However, socially accepted forms of gains are exceptions.

⑥ We will adhere to the relevant laws and regulations on transparency in undertaking all

financial and fiscal operations.

⑦ We will refrain from sending invitations during company events to supplier companies,

so as to not impose pressure for attendance or gifts. Furthermore, we will refrain from unduly notifying family events of employees to the suppliers to refrain from imposing pressure.

⑧ We will not use company assets for personal reasons, and refrain from disclosing

confidential company information acquired during work to external parties.

⑨ All executive rank members will keep close consideration of CSR when responding to

opportunities and risks, and will serve as leaders in the industry by acting in accordance with the internationally prescribed business management conduct.

⑩ To prevent sexual harassment in the workplace, the company will conduct at least 1 annual

sexual harassment prevention training which needs to be attended by all employees. When any harassment occurs, strong measures should be taken.

1. Employees should refrain from causing sexual humiliation or emphasizing pre-established

gender roles.

2. Employees should refrain from lewd jokes and forceful drinking or dancing during

get-togethers.

3. Employees should refrain from watching pornographic materials during work through

the internet, computer, or other medium.

4. Employees should not pass sexual evaluations or comparisons related to a coworker’s

physical appearance.

5. Employees should refrain from intentional or unnecessary physical contact.

⑪ Employees will refrain from using illegal computer software.
⑫ We will not engage in any activities that may be deemed unethical in an objective

assessment.

⑬ All employees of Lotte Shopping Co., Ltd. should refrain from using their ranks or work

authorities to acquire confidential management secrets or unannounced information for personal gains through stock trades, or leakthe information to an external party.

Article 11 [ Good faith ]
We will give our best to sincerely complete all tasks that are our duties, and engage in our work in honesty and fairness,
① Employees should undertake the roles assigned to each individual according to the

company’s management ideology.

② Employees should prevent any risk that may arise as a result of his/her decision-making

or action, and take full responsibility in case of trouble.

③ Employees should work hard to guarantee active inter-departmental cooperation and

communication with colleagues.

④ Providing financial payments or gifts among employees is strictly prohibited with the

following exceptions:

1. Voluntary financial payment of gift by a superior to a subordinate
2. Giving gifts for birthdays and other special anniversaries through personal funds
3. Giving gifts purely as a way of expressing gratitude, with no expectations of a reciprocal

action or gift

⑤ Celebratory payments among employees during family events should be voluntary and

in accordance with social customs.

⑥ Borrowing of money among employees is strictly prohibited. If lending is necessary,

permission must be given by the superior of the lender prior to the lending activity.

⑦ Employees should refrain from standing as guarantor for each other. However, for company

loans offered as part of the company’s welfare project, employees may stand as guarantor for one another with the approval of their superiors.

⑧ Employees should not receive any form of gain including financial payments and treats in

exchange for an unethical favor.

⑨ When the application of these provisions cause a conflict of interest between the company

and the individual, priority should be given to the communal interests of the company.

Article 12 [ Mutual respect ]
We will respect individual value and inherent dignity of each person, and give our best to create a healthy and happy work life.
① Employees will refrain from any actions that veer away from basic etiquette.
② Employees will refrain from impolite actions or arrogant comments that offend suppliers and

coworkers.

③ Employees will take care to maintain a clean appearance and confident attitude, and refrain

from any action that may arouse contempt.

④ Employees will refrain from giving preferential treatment based on education, gender,

religion, age, and place of origin.

⑤ HR management should be able to prevent complaints regarding HR management policies,

such as promotionsand transfers, through continuous monitoring and feedback.

⑥ The company should exert additional efforts to improve the quality of work life.

Article 13 [ Ability development ]
Based on a firm background knowledge and refinement required as a worker, we will take pride and confidence as a Lotte member.
① We will give our best for self-development, so as to become a talent that can lead

Lotte Shopping globally.

② Superiors will not hold back on guidance and advices for their subordinates’ characters and

talents, while the subordinates will improve their ability to conduct work operations individually.

③ The company will provide equal opportunities for training programs that are designed to

improve creative thinking and autonomous work capacities.

④ All tangible and intangible knowledge acquired during work operations should be shared

by all employees so as to help develop the company.

We will reinforce mutual trust and cooperation through transparency and fair trade, so as to pursue mutual growth under the free market competition.

Article 14 [ Fair trade]
① Under the principles of free competition, we will guarantee equal opportunities for

participation and ensure equitable provision of information necessary for transaction so as to realize mutual benefits.

② All transactions will undergo sufficient negotiation under the principle of reciprocity so as to

ensure fair trade.

③ We will not unilaterally make alterations to the conditions and procedures of the transactions

that may bring harm to the suppliers without prior negotiation with the suppliers.

④ We will not take part in any action deemed unethical by the fair trade regulations, including

antitrustand anticompetitive behavior.

Article 15 [ Pursuit of mutual development ]
① We will view our suppliers as partners and maintain equal positions in contracts, and give

our best efforts for improving mutual cooperation.

② We will help improve our suppliers’ competitiveness and strive for mutual development.
③ We will spread and promote the company’s code of ethics and Ethics and Conduct

Regulations to the suppliers so as to encourage their active participation.

Article 16 [ Prohibition of non-ethical acts on partners ]
① We will not receive any financial payments, treats, entertainment, or convenience-oriented

treatments from our suppliers for any operations related to our work. However, socially accepted customs are exceptions.

② Other prohibited and non-ethical acts

1. Substitute payments of card bills, credits, loans, and other financial obligations by the

supplier for anywork-related operation are prohibited. Receiving guarantorship for loans and movable assets, and other real estate,stock, sales, membership, and other asset-related gains are prohibited.

2. Employees should not borrow money from suppliers.
3. Employees should not lease or borrow assets or receive collaterals from suppliers in any

work-related operation for personal convenience or gain.

4. Employees are prohibited from buying from the suppliers any movable assets or

real estate assets at a lower-than-mark value price for practical gain.

5. Employees are prohibited from taking non-ethical actions against suppliers for other

operations.

By constantly reminding ourselves that the company exists only on top of a stable foundation in the nation and society, we will promote healthy business practices to develop the company and create social wealth, so as to contribute to bringing a bountiful life for the people and social development for the nation.

Article 17 [ Stable business activity]
We will respect social values to undertake practical and healthy business activities.
① We will reject all irregularities that hinder stable business activities.
② We will do our best to fulfill our CSR through education, culture, scholarship, and welfare

projects.

③ We will encourage employee participation in volunteering projects and contribute to social

development.

④ We will humbly respect and listen to the demands of all classes and local residents.
⑤ We will continue to create new jobs so as to contribute to the nation’s development.
⑥ We will respect and operate in accordance with internationally recognized conventions

based on the Universal Declaration of Human Rights (UDHR) in all our activities.

Article 18 [ Non-political intervention]
Lotte Shopping Co., Ltd. will refrain from meddling in politics.

Article 19 [ Environment-friendliness ]
We will continue to implement activities aimed at preserving the earth and exert our utmost efforts for saving the environment.
① We will follow environmental regulations and actively partake in preventing climate change

and reducing greenhouse gases.

② We will build the necessary facilities to prevent pollution and improve the environment,

and continuously manage these facilities.

③ We will protect the living environment of the region of our business activity and give our best

to the creation of a pleasant environment for the local residents.

Article 20 [ Safety management and accident prevention ]
Lotte Shopping Co., Ltd. believes that the protection of safety for our employees, workers dispatched from suppliers, and customers is a crucial management requirement that should be complied by businesses. Furthermore, the Lotte Shopping Co., Ltd. personnel will ensure strict safety management for the customers and do their best to follow all regulations regarding accident prevention.
① In case of accident, the company will take swift measures that prioritize the safety of

customers and local residents.

② The company will offer comprehensive education and training courses to its employees

regarding safety handling as well as accident and disaster prevention, and adhere to all safety regulations.

③ The company will conduct regular evaluation of various facilities (elevator, escalator, etc.)

and give the best efforts to prevent accidents caused by fire or gas.

Article 1 [ Period of execution ]
① These provisions came into effect on January 1, 2001.
② These provisions were enacted and put into effect on May 1, 2010.

Article 2 [ Prohibition of retroactivity]
These provisions are not applicable for unethical behaviors conducted prior to the effective date.

Article 3 [ Installation and operation of Ethics Management Committee ]
① The company will install an Ethics Management Committee to assess and implement

the company’s code of ethics and the ethics and conduct regulations, and establish an ethics office to support the committee work.

② The operations of the Ethics Management Committee will be detailed in a separate regulation.

Article 4 [ About report ]
For all actions that do not fit into the social norms listed in the provisions, the employees should report the action prior to or right after its occurrence. Reporting and handling procedures will be detailed in a separate regulation for the Ethics Management Committee.

Article 5 [ Operation of internal report system and protection of a reporter ]
① For any items that may hurt the company, all personnel of Lotte Shopping Co., Ltd.

should report to the department in charge (Lotte Shopping Co., Ltd. ethics headquarters) regardless of the severity of the situation, and these internal reports should be processed anonymously.

② All department staff and administrators working for the internal report system should never

reveal the identity of the reporter, and there should be no consequences or unfair treatment as a result of the reporting.

Article 6 [ Reward and punishment]
① Those with the biggest contribution to the ethics management activities may be rewarded on

the decision by the Ethics Management Committee, and the reward standard and procedures will follow related procedures in the company’s internal regulations.

② Violators of the code of ethics and the ethics and conduct regulation will be sanctioned upon

the decision of the Ethics Management Committee, and the details on the severity of the disciplinary action or penal measures will depend on the company’s internal regulations.

Article 7 [ Standard of interpretation ]
① This provision takes priority over all regulations applied to the company with the exception

of the articles of association and the code of ethics.

② Measures not included in the provision or disputes in interpretations of the provision will be

submitted to the Ethics Management Committee for interpretation and decision making.

Article 8 [ Revision ]
Renewal of the application of this provision will follow the decision by the board.