SOOP ESG2023

SOOP focuses on risk management to strengthen its organizational resilience and secure the soundness of its financial structure in a rapidly changing business environment. Through a systematic risk management strategy for comprehensive management of non-financial risks by the business division/team, SOOP proactively responds to risks and strives to actively discover factors that can be converted into opportunities to strengthen its business competitiveness.

Self-Regulation

SOOP thoroughly manages the freedom of expression, which is a fundamental right of users on the Internet, to ensure that such freedom of expression is not infringed while it does not violate the human rights of others. In particular, SOOP strictly complies with the Act on Promotion of Information and Communications Network Utilization and Information Protection and implements self-regulation through consultation with major government ministries concerning areas in which the interpretation of the application of such law is not clear or not specified therein. In addition, SOOP has prepared appropriate guidelines to respond to the rapidly changing industrial landscape in consultation with relevant organizations. In December 2023, SOOP received a commendation from the Minister of Gender Equality and Family for its contribution to self-regulatory cooperation for the protection of the youth.

Strengthen Key Risk Screening and Management

SOOP analyzes various risks that may arise from stakeholders from various angles and proactively responds to them to promote the stability of its business operation. SOOP prioritizes and systematically manages major risks related to the business environment and regularly strengthens its risk management capabilities. By establishing an enterprise-wide risk management system, SOOP secures sustainable market competitiveness, predict, and prepare for, risk factors in advance, and systematically manages the entire process from identifying and evaluating risks to the response process and preventive action after all follow-up measures are taken. The BOD is in charge of risk management, and the CEO strives to minimize risk losses through efficient decision-making.

Risk Identification and Response

SOOP defines risk as “the potential for a certain situation or activity that may occur throughout business operation to cause adverse consequences or losses to the company’s goals and values.” SOOP identifies financial and non-financial risk factors in advance, and for each risk, SOOP determines response priorities by comprehensively considering its impact on the business and its likelihood of occurrence. In addition, SOOP creates a list of response activities for the nature of each risk and manages the status and results of the response to systematically mitigate risks.

Financial/Investment Risk

SOOP thoroughly manages potential financial risks to prevent the occurrence of related problems and maximize its shareholders’ benefits by maintaining a sound capital structure. SOOP has established an internal organization and process for this purpose, and the BOD has established rules of approval for each investment amount to verify the efficiency of large-scale investments and constantly monitors changes in the market or business environment to detect related risks. SOOP responds to financial and investment risks from a mid-to long-term perspective by determining the feasibility of investments and continuously managing these risks in consultation with relevant divisions/teams.

In addition, SOOP has established internal control management regulations to ensure compliance with laws and regulations and to secure operational efficiency. As the importance of the internal accounting control system has increased in recent years, SOOP has been improving related processes by strengthening ITGC(Information Technology General Control) to enhance the reliability of accounting information.

SOOP strictly complies with relevant laws and regulations, including the Personal Information Protection Act, the Act on Promotion of Information and Communications Network Utilization and Information Protection, and the Act on the Consumer Protection in Electronic Commerce. In addition, SOOP has established self-regulations related to social risks and continuously monitors them to proactively respond to risks resulting from changes in regulations or ethical standards. For example, SOOP had set a cap on the amount of item purchases. Notably, SOOP operates separate caps on minors to prevent excessive consumption.

Meanwhile, as SOOP’s global business operation has expanded, the possibility of the occurrence of human rights risks for SOOP has also been increasing. Accordingly, SOOP regularly reviews and amends its human rights declaration and establishes, and strictly complies with, separate operating policies to minimize the risk of human rights violations in its platforms/contents.

• Human Rights Charter
• Media Operation Policy

Emerging Risk

SOOP defines the emerging risk as “an actual and potential uncertainty that is expected to affect the company’s operation in the long term.” As shown in the table below, SOOP identified the top three emerging risks that are likely to have material impacts on SOOP’s business for the next three to five years.

Tax Risk Response and Management Procedures

The principle of SOOP’s response to tax risks is based on strict compliance with laws and regulations. SOOP submits evidence to prove facts as requested by tax authorities and does not use any tax haven or utilize any tax structure without commercial substance for tax evasions, and SOOP faithfully fulfills its tax obligations in all jurisdictions. SOOP prevents tax risks by identifying differences in tax laws of different countries and the intentions of tax law enactments of different countries and analyzing the grounds of related disputes, and in particular, in transactions between related parties at home and abroad, SOOP applies the principle of arm’s length transactions and establishes, and continuously monitors, pricing policies to prevent tax issues from arising. SOOP also provides tax authorities around the world with data related to transfer pricing based on the submission of tax information for each country.

• Identify

  • Legal and regulatory internal review
  • Categorization of risk types
• Negotiate

  • Identify the counterparty
  • Negotiate fair-trade prices, etc.
• Enquire

  • Enquire tax authorities in advance
  • Authoritative interpretation
• Consult

  • Consult with experts from outside the company
  • Delegate response activities

Tax Policy and Transparent Disclosure

SOOP aims to contribute to the development of society and the national economy by complying with tax laws and related laws and regulations and actively managing tax risks. To this end, SOOP has established the following four major principles of tax management to strictly comply with domestic tax laws and tax standards of countries in which it has interests. SOOP also actively cooperates with the tax policies of relevant countries and maintains amicable relations with their tax authorities.

In addition, to enhance the transparency of information, SOOP regularly provides its internal and external stakeholders with tax information through its annual reports and performs the obligation to report after final review by its internal and external tax experts. The BOD holds a quarterly meeting to approve and review the obligation to file tax returns and pay taxes in good faith in accordance with laws and regulations, which is supervised by the SOOP’s Audit Committee.