Sustainability management at S-OIL starts from understanding the expectations of C.E.O. (Customers, Employees, Owners & other stakeholders). Going forward, the Company will create economic, environmental, and social values reflecting the expectations of C.E.O. and contribute to the development of society and the nation.

S-OIL's performance-oriented corporate culture is further reinforced and supported by its transparent and reasonable HR system. The Company ensures transparency and fairness in its recruitment and evaluation process and provides employees with various training programs to cultivate core resources to drive its growth forward. The Company also offers an array of benefit programs to employees through its advanced compensation and benefit systems to promote a healthy work & life balance.

HR Management / Fair Evaluation & Compensation

S-OIL pursues the diversity of its employees and strives to create a virtuous cycle where the Company encourages every employee to unleash their full potential bring about innovation and contribute to the Company's growth.

Securing Talented Employees through Fair Recruitment Procedures (SDGs #5 and #8)

S-OIL strives to secure talented resources from diverse backgrounds by implementing a fair recruitment process that rules out any discriminatory factors such as gender, age, region, academic background, or disability. The Company is also proactive in hiring socially marginalized groups such as the disabled. The channels through which the Company reaches and attracts talented resources who also share its core values are extended to campus recruiting, internship, and scholarship support programs. The Company does not require potentially discriminatory information from applicants for the screening process and adopts a blind interview system in an effort to ensure that all applicants are evaluated solely on their competence and qualifications. The Company's transparent and fair recruitment process is a driving force for sustainable growth amid the current business environment of increasingly fierce competition.

Performance-based Evaluation and Compensation

Evaluation System for Improvement of Individual Capacity and Organizational Performance
S-OIL takes a fair and objective approach to employee performance evaluation so as to entrench a performance-oriented corporate culture. For performance evaluation, employees develop individual action plans based on organizational objectives to ensure that individual and corporate goals are aligned. And the Company encourages employees to attain their goals through periodic progress tracking. The Company ensures that fair evaluation is carried out for the actual performance against the action plan, and compensation is commensurate to the performance so as to motivate employees. Furthermore, the Company makes sure corporate policy adherence is encouraged throughout the process by factoring the achievement in areas associated with its core values into the evaluation. As for competency evaluation, the Company goes beyond granting an evaluation grade and works to give practical support to employees for developing and implementing career and competence development plans based on their competence evaluation results by following up their progress throughout the year. The Company also holds Talent Review Session (TRS) to discuss and determine matters relating to job rotation and core talent recruitment and to provide employees with well-thought-out support in developing their careers.
Performance-based Compensation System
In line with the performance-oriented organizational culture, S-OIL has instituted a performance-based rather than seniority-based reward and compensation program and extended it to include all office workers. The new performance-based pay structure where a wage increase in line with the service period for the same position was scaled down while that from promotion further expanded effectively motivates employees for higher performance. In addition, the Company introduced a merit-based system for office workers to differentiate the annual performance reward they receive in accordance with their evaluation results as a way to further encourage them to perform better at work.

Talent Cultivation

S-OIL's competency development model consists of basic competency for all employees, leadership competency for leaders, and job competency for specific job positions. A systematic training program is offered in accordance with employees' role level (job grade).

Operation of Effective Training System (SDGs #4)

Based on annual competency evaluation results, S-OIL provides employees with not only in-house collective training but also various online training courses accessible via mobile devices so that employees can develop their competences anywhere, anytime. The Company allows employees to take courses outside the Company as needed to meet increasing needs for more specialized training. The Company also operates Learning Cell, an open learning platform for employees who want to share their knowledge and experience while satisfying their own needs for learning. This program allows employees to form study groups on any topic they are interested in to meet for a small group lecture, group learning, or reading discussion. For global competency building, the Global Learning & Communication Center provides targeted support for foreign language learning. The Company provides employees attending these programs with learning materials and expenses to promote their active interaction and competence development.
Systematized Learning Management System
At S-OIL, the Learning Management System (LMS) has been used since 2015 to increase the efficiency of training programs and thus effectively develop the competency of employees. LMS analyzes the patterns of users who access the system and customizes main page for individual users. It also features My Classroom for the community learning where users can search a wide variety of video clips and materials for self-driven study. E-learning courses from the LMS are available via both PCs and mobile devices. In 2018, the Company implemented micro learning into employee training by adopting a Smart-Learning system running on a mobile platform, significantly enhancing user convenience and enabling access anytime and anywhere. The various training systems at the Company not only help employees to stay on competency development programs and benefit from them but also improve operational efficiency of educational administration for the Company.
Leadership Training Program
With the aim of cultivating leaders who will lay the groundwork for the successful accomplishment of Vision 2025, S-OIL set up a leadership pipeline for different leader groups in 2017. This ensures proper training is given to officers and employees before their taking on a new role. To ensure effective leadership training, the Company uses the flipped learning approach where online training precedes offline training so that employees can acquire knowledge first and then find ways to apply it through discussion. The Company selects talented resources and sends them to leadership trainings offered by universities and training institutions at home and abroad. Leader groups are also provided with the regular leadership diagnosis and a one-to-one coaching program for continuous monitoring and feedback.
S-OIL Academy for Specialized Job Training
S-OIL has been running S-OIL Academy for specialized job training since 2011. Particularly, the S-OIL Academy for Marketing & Sales covers service station operation, negotiation, and sales skills in a systematic manner so that domestic sales professionals can learn from actual cases of domestic oil product sales activities. As for the S-OIL Academy for Operations aimed at sharpening job competency of engineers and operators, the Company introduced the blended learning which combines online and offline job courses. In order to establish a stable operational competency for start-up and shut-down of each unit and to develop emergency response capabilities, the Company offers the Operation Training Simulator program. Also, an advanced program has been in place to support the reskilling and upskilling of manager-level engineers or above. Leadership courses are offered to foremen as well.
ECP for Engineer Competence Enhancement
S-OIL has in place the Engineer Cultivation Program (ECP) to support the systematic training of engineers. Under this program, engineers draw up the Customized Personal Training Program (CPTP) by considering individual functions and career path every year based on interview with their team leaders. The training outcomes and achievement is systematically managed through LMS. In addition to ECP, the Intensive Overseas Training Program cultivates engineers with a global mindset and competency.
Global Communication Skills Training
S-OIL looks for its employees to strengthen their global communication skills to continue building success in global markets and operates the Global Learning & Communication Center (GLC) in the Head Office in Seoul and Onsan Refinery in Ulsan. With the aim to enhance employees' capability to communicate and do business with overseas business partners, the GLC offers not only foreign language courses on English, Chinese, Japanese and Arabic but also courses to help understand global cultures, business etiquette and manners, and speech training. In particular, the GLC operates a well-thought-out curriculum targeting team leaders, new employees and employees soon to be dispatched to overseas offices thus catering to specific needs based on their roles. The GLC also takes various approaches to training, including group training and one-on-one courses, to make training more effective and convenient from the users' perspective.

Nurturing Next-generation Leaders

With a firm belief that cultivating core talents will drive the Company's future success, S-OIL runs a systematic HR development program to nurture the next generation leaders. In 2018, the Company started the Potential Future Leader program where the Company selects talented employees with great potential and has them accumulate diverse experiences through cross-functional rotation based on the Leadership Development Plan. Also, the Company maintains a systematic means for monitoring performance throughout the program. Employees also benefit from the Company's policy to support MBA studies in Korea or overseas, or to support the Master's program in science and engineering at IFP School in France. Fully aware of the important roles female leaders play to the organization, the Company also focuses on developing diverse female leadership programs. These advanced training programs will produce core talents who can lead the Company to a sustainable growth.

Corporate Culture / Labor-Management Relations

S-OIL has established a productive and healthy corporate culture based on effective and vibrant communication across functions. The Company operates industry-leading benefit programs that reflect employees' needs and makes continued efforts to promote the physical and mental well-being of employees. The Company strives to provide employees with the best work environment to assure higher work efficiency. Furthermore, the Company is committed to laying the groundwork for sustainable growth by maintaining a harmonious labor-management relationship.

Internalization of Core Values

At S-OIL, all officers and employees are taking on responsibilities and realizing their full potential to the fullest in order to achieve Vision 2025, based on the core values that are shared across the organization and constitute the common foundation upon which the Company makes decisions and conducts business activities regardless of external environmental changes. The Company is concentrating efforts to raising awareness of employees on the core values and applying them to business and decision-making processes. Furthermore, these core values are reflected in the recruitment process and evaluation criteria for office workers. The Company also recognizes employees who live up to the core values in its continued efforts to hire and nurture talents who share the Company's core values. The Company produces the CEO messages and video clips on cases that demonstrate the core values and share them across the organization as educational material. The Company is committed to maximizing business ethics and core values by continuously internalizing them through programs such as core value workshops.
Promoting Collaboration and Communication
S-OIL promotes collaboration and communication as a way to break down the silo among individuals and teams and create a productive and healthy corporate culture. As part of such effort, surveys on work efficiency and satisfaction are conducted among all employees and the results are reflected in diverse activities aimed at bolstering internal communication. In addition, the Company-wide business explanation session is held twice a year where the top management presents the Company's business status, including business performance, outlook, critical business issues, and all participants ask questions freely during a Q&A session. With the aim of expanding communication, both vertically between leaders and their members and horizontally among individuals or organizations, the Company encourages diverse team building activities and programs such as Junior Board, communication sessions for new employees, Dynamic Rookies program, and communication promotion program at District Bizs HQs.

Employee Engagement through Work & Life Balance (SDGs #3)

Guided by a belief that employees who strike a balance between work and life can focus more on their work with creativity and passion, S-OIL continuously reviews and make changes to its policies beyond the social expectations and legal requirements to ensure employees can relax and have quality family time away from work. As part of this, the Company runs various programs such as the two-week intensive holiday, summer vacation, off-duty day, and monthly refreshment day (MRD), so that employees may fully use their annual leaves. Furthermore, the Company provides resort reservations across the country for employees going on a vacation. Employees are also free to check in at hotels and resorts in popular tourist destinations in the summer and winter months. More than 50% of employees visit those recreational facilities every year. In the meantime, a survey was conducted in 2018 using a new diagnosis approach to gauge the level of recognition and satisfaction of HR services and use the data as the base for improving organization culture and performance. Going forward, the Company will continue to improve the HR system by monitoring the employees' HR recognition and satisfaction level.
Achieving work efficiency through streamlining work process
In 2018, S-OIL introduced the Smart Work system across the board to encourage employees to leave on time where possible, take breaks, and get a healthy work and life balance, which is a key to employees' focus, energy, and productivity at work. In addition, the Company established Leaders' Way of Working and implemented the scheme through various channels so that leaders can increase work efficiency. Efforts for greater work efficiency are also made at all levels, giving a lecture on work efficiency and work efficiency improvement workshop, support employees and teams going on a work diet and bringing about positive changes to way of working.

Industry-leading Employee Benefit Programs (SDGs #3)

To create a workplace where employees can feel deeply engaged in their work based on financial stability, S-OIL offers top-tier benefits and wellness programs. In addition to the basic benefits package including four major public insurances and the congratulations & condolences money support, the Company offers an array of employee benefits tailored to the life cycle to ensure that employees can fully engage in work as well as satisfy themselves in terms of housing, health, children's education, leisure activities, and financial planning after retirement.
New Pension Program
Given that Korea's average life expectancy is rising faster than people can adapt and prepare for, S-OIL pays full attention to ensuring a stable life for employees after retirement. In this regard, in 2015, the Company introduced the New Pension program, a matching grant scheme where the Company pitches in for employees' post-retirement resources. Currently, 99% of total employees have subscribed to the program. The program is designed in a way that employees can develop interest in the Company's growth in the mid- to long-term by accumulating pension fund commensurate with the mid- to long-term performance of the Company.
In-house Daycare Center
To help employees fully engage themselves both at work and home, S-OIL established daycare centers in the Head Office and Onsan Refinery. Operation of the daycare center has significantly boosted the satisfaction of employees amid the shortage of public centers and widespread mistrust on private centers. It has helped alleviate the employees' burden of childcare and contributed to promoting a healthy organizational culture based on work and family balance. In particular, the Company has entrusted operations to the Puruni Childcare Foundation, which is one of the best childcare institutes in Korea, offering an excellent child-rearing environment. The daycare center provides comprehensive educational programs that meet the interest and demand of children and maintains close communication between the institute, parents, and the Company.
Employee Health Management
S-OIL operates health clinics at the Head Office and Onsan Refinery manned by nurses at all times to swiftly respond to emergencies during work hours as well as take care of employees' health at normal times. The Company operates nursery rooms and provides ergonomic office furniture for expectant and breastfeeding mothers. The Company also commissions prestigious medical institutes for annual medical check-ups and runs fitness centers at the Head Office and Onsan Refinery. In addition, the Company carries out health campaigns periodically while ensuring a convenient recovery from disease by guarantying medical allowances and leaves. Mental stability as well as physical health is critical for full employee engagement. To that end, the Company runs the Employee Assistance Program, a comprehensive consultation service where outside professionals provide tips on job-triggered stress, interpersonal relations at work, family relations, childcare and more.

Providing Best-in-Class Work Environment (SDGs #3)

S-OIL strives to provide employees with the best-in-class work environment by optimizing workspace, maintaining a pleasant work environment, and serving swift business support. The Company runs a Creative Lounge in the Head Office for self-development and relaxation and a variety of other spaces dedicated to supporting external projects, while enhancing business efficiency. Moreover, the main auditorium at the Head Office is offered to employees for a wedding event of themselves or their children. In 2018, the Company continued to implement various workplace improvements, including LED light replacement, AV/VC device upgrade in meeting rooms, and comfortable office furniture procurement.

Collaborative Labor-Management Relations

S-OIL's labor-management relationship sets an exemplary precedent for the industry as there has been no single labor dispute for the past 39 years since establishment of the labor union in 1980. This was possible based on mutual trust and cooperation between the labor union and the Company. The management respects union activities and takes heed of the labor union's voices while complying with relevant laws and regulations. The labor and management work together to lift corporate competitiveness, improve the quality of employees' lives, and fulfill corporate social responsibility through a variety of communication channels including the Labor-Management Council, the Industrial Safety & Health Committee, and joint workshops as well as wage negotiations and collective bargaining. The contents of labor-management negotiations are disclosed to all employees immediately.

Industrial Safety & Health Management

Not feeling complacent with the existing safety framework of minimizing accidents and complying with safety regulations, S-OIL has established safety standards that exceed legal requirements. Based on top management's commitment to safety and its high standard of safety culture, the Company is striving to create one of the safest workplaces in the world. In addition, the Company has laid out a company-wide goal of building the world's best safety culture and maintaining zero accident workplaces. To this end, the Company is conducting various measures such as providing safety education to employees and contractors and supporting safety management of contractors. Furthermore, the Company periodically carries out drills to minimize damage on the Company and the local community in the face of unpredictable emergencies such as earthquake, fire, explosion and leakage. In particular, the Company develops accident scenarios and conduct thorough safety training for project sites. As a result of such efforts, the Company achieved 7 million zero-accident manhours without loss time injury in 2018 for the second time in its history.

World-best Safety Culture

S-OIL is engaged in a variety of activities to enhance its safety culture, such as by operating an IT-based management system that utilizes the checklist in accordance with the tightened SHE regulations. Through the Safety Keeper program, the Company improves the safety-related capabilities of individuals and promotes daily compliance of regulations and procedures. A wide range of safety activities were carried out to encourage employees to voluntarily practice safety with the goal of a safety action plan established. The company-wide Safety Management Committee also convenes regularly to devise safety policies and support safety inspection for the Head Office, Onsan Refinery and terminals, and to strengthen the Company's safety capacity through active communication and sharing of accident cases. In addition, safety education by job and level to 15 different positions and job functions is provided to reinforce employees' safety capabilities and awareness. Due to such preemptive safety-related investment and preventive measures for industrial accidents, the Company succeeded in maintaining the safety culture score for Onsan Refinery and terminals at 8.1 points in 2018, demonstrating the Company's world class safety culture.

Continuous Reinforcement of Safety Management System

To promote effective safety management, S-OIL is consistently improving the safety management system and eliminating root causes of accidents by utilizing the Behavior Based Safety (BBS) program that identifies and addresses unsafe behaviors or conditions. The Company keeps track of the safety indicators for employees and contractors on a real-time basis and making the safety management system more practical and relevant through workshops and consulting services. As there exists a strong correlation between near misses and major accidents, the Company has in place an incentive system for discovering near miss accidents to identify and share cases between employees, aiming to prevent potential risks. Also, the Company launched the Safety Keeper program to champion the internalization of safety practices in day-to-day work on the site and to achieve its safety targets.
Employee Health Management
S-OIL is engaged in various activities to manage and promote the health of its employees. Twice a year, the Company takes measurements in its work environment for about 40 categories as required by relevant laws to check if the TWA reading exceeds the exposure threshold, and establishes response plans accordingly. The Company regularly reviews its material safety data sheet for all materials handled by the Company and provides all employees with accurate hazard and risk information. In summer, the Company conducts employee health campaign, in which glucose and ion drinks are distributed to prevent heat stress and heat-related illness, and in the winter, it also supports employees with flu vaccination. In addition, the age limit for comprehensive medical check-up sponsored by the Company has been lowered to 35. In 2018, the Company distributed fine dust response leaflets, made employees wear dust masks in outdoor workshops, and expanded the health care center in Onsan Refinery.

Reinforcement of Emergency Response Capability

Initial response is critical to prevent an accident from escalating into a major disaster. Recognizing this, S-OIL has established the Emergency Control Program (ECP), an enterprise risk management system. In case of an accident, the ECP ensures that the Emergency Control Center (ECC) is activated, both at the Head Office and the site. The ECC calls emergency meetings, shares the location of the accident via video conference system, and orchestrates the response activities to keep the situation under control. On the site, the command transmits the status to the ECC in real time, allowing the ECC to make immediate decisions based on the live feed and remotely control the site. Furthermore, the Company strives to build the enterprise emergency response capability so as to effectively handle large-scale disasters, such as fire, power outage, oil spill, earthquake, and tsunami. To this end, simulated emergency response drills are planned for and carried out more than 24 times each year, at both enterprise and business site levels, and both in accordance with ready-made scenarios and in an unannounced manner. In addition, all employees are trained in basic firefighting equipment and cardiopulmonary resuscitation. To improve the initial response capability of its own fire brigade and joint response capabilities with external related agencies, the Company regularly conducts emergency mobilization drill and fire scenario exercise. In 2018, the Company also conducted a study jointly with local fire departments on the foot print fire control strategy for a fire in a large tank. As such, the Company is striving to minimize damage to personnel, environment, and property in case of an accident.

Support for Safety Management of Contractors

S-OIL engages in various activities such as technical supports aimed at helping contractors reinforce their safety management capabilities. The Company launched the contractor safety and health cooperation program with its contractors even before the increasingly stringent regulations came into force. The Company also collects opinions from contractors through an annual survey. In 2018, a total of 36 contractors participated in this program and to ensure safety in the workplace under the shared goal of having a zero accident workplace. The Company conducts various safety management activities such as regular safety meetings, safety checks, and safety campaigns, and provides diverse safety education for contractors, including safety leadership lectures, supervisor workshops, and risk assessment training. The Company provides consulting support for contractors to obtain the Occupational Safety and Health Management System (KOSHA 18001) certification and KRAS Risk Assessment certification to enable contractors to achieve a high level of safety management capabilities, and as of 2018, all 36 contractors have obtained certifications. Starting in 2018, the Company supports contractors that are willing to launch a zero accident campaign at their worksite, including awarding a certificate of recognition for achieving their zero accident safety goals, striving to create a global top-tier safety culture in workplace.