We believe that trusted business relationships are built on honesty, openness and fairness. We pride ourselves on maintaining high ethical standards at all levels of our organization, and we expect our directors, officers, employees, agents and contractors to act with honesty and integrity. We also endeavor to deal fairly with our customers, suppliers, vendors, competitors and other stakeholders.
To that end, our ethics and compliance program is designed to deter wrongdoing and to promote honest and ethical conduct. We have also introduced robust systems and processes to allow internal and external parties to raise concerns without fear of reprisal.
Oversight and management of business ethics
Overall responsibility for business ethics at Magnachip lies with the Board and the executive team. However, the C&IA Team is responsible for managing the issue on a routine basis.
Our C&IA Team is responsible to and reports to our CCO, and also has a direct reporting line to the Audit Committee. The manager of the C&IA Team presents ethics-related updates to the Audit Committee and Board in quarterly in-person meetings (without the presence of any executives).
Our management and Board-level teams review business ethics monthly, or more frequently as circumstances require.
Audits and investigations
The C&IA Team conducts internal audits and investigations based on its annual work plan and any whistleblower reports received. The scope of annual work plan, which guides the internal audit, includes reviewing our code of business conduct and ethics framework in light of regulatory developments, selecting focal topics for the audit for the given year and evaluating past incidents and responses.
If any unethical behavior is uncovered that contravenes the standards outlined in our Code of Business Conduct and Ethics, the team will recommend appropriate disciplinary action. The team reports on its findings to the Audit Committee and Board in its quarterly meetings.
We have incurred no monetary losses due to unethical behavior during 2023.
Code of business conduct & ethics
Our Code of business conduct & ethics (“Code of Ethics”) sets forth of the broad principles of legal and ethical conduct that reflects our company’s core value, guiding all business decisions. As we continuously review and update our policies and procedures, our Code of Ethics was lastly amended in 2023.
We operate a zero-tolerance approach to fraud and unethical behavior. Our directors and employees are expressly forbidden from taking part in any unethical or illegal act, or one that conflicts with the company’s interests. As such, our Code of Ethics applies to our directors, officers and employees equally.
On a day-to-day basis, the code is managed by our Legal and C&IA Teams. If the code requires significant alteration, this is reported to the CCO and then sent to the Board for review.
Click here to view or download the code: Code of Business Conduct and Ethics
In the event of any executive malpractice, we have adopted a clawback policy that complies with SEC rules and also reflects many of the recommendations made by leading proxy solicitors.
Whistleblower policy and reporting
We take whistleblowing seriously and have created robust structures to encourage the reporting of malpractice and protect individuals who may come forward. Reportable matters include unethical or illegal behaviors or activity, and the violation of our Code of Ethics.
Our reporting system allows anonymous reporting and is accessible to our partners, suppliers and customers.
Non-retaliation policy
The rights of whistleblowers are protected by laws set out by the government of Korea and other national and international institutions. As such, our non-retaliation policy is designed to encourage and protect ‘good faith’ reporters, and it prohibits any reprisal, threat, retribution or retaliation against any person who has reported an issue of concern.
Our Code of Ethics also sets out a clear escalation model for concerns raised through confidential investigations by the Legal Team and the Audit Committee chairperson. The code also sets out our commitments to protecting whistleblower identity, and the process of investigations.
Training on ethics and compliance
On joining the company, every employee is required to read and sign the Code of Ethics. Following this, all employees must undertake mandatory annual ethics training prepared by the C&IA Team. At the end of the training, employees are required to sign a statement to the effect that they understand the code, and participation in this program is monitored by the HR Team.
The C&IA Team also publishes alerts on a monthly basis to remind employees of the importance of maintaining high ethical standards, often with reference to real-life case studies. This monthly alert is available via email and through the main bulletin on our internal groupware system.
How to raise concerns
Our C&IA Team operates an anonymous whistleblower hotline and website that is available 24/7 in English, Korean and Chinese languages. All reports received through these channels go directly to the C&IA Team as well as our CCO. In all instances, the identity of the reporter will be protected unless unavoidable.
Any issues can be reported by clicking “Reporting a Concern” below. You can also view and manage your reports by selecting “My Reports”.
Concerns can also be raised in writing at the following address:
C&IA Team, Magnachip Semiconductor, Ltd.
15F, 76 Jikji-daero 436beon-gil, Heungdeok-gu, Cheongju-si, Chungcheongbuk-do, Republic of Korea, 28581
For any questions about using these services, please contact the C&IA Team at:
compliance@magnachip.com.
Grievance reporting and escalation
To express any complaints or grievances, our employees can use the online reporting system (linked above), or the reporting tool in our internal groupware system. To ensure fairness and transparency, all complaints and grievances will be addressed in a structured and systematic manner.
Anti-corruption, bribery, lobbying
Our Anti-Corruption and Anti-Bribery, Lobbying and Political Contribution policies are embedded in our Code of Ethics.
Furthermore, all of our directors, officers, employees, agents and contractors, whether located in Korea, the United States or elsewhere, are responsible for FCPA (the United States Foreign Corrupt Practices Act) compliance and the procedures to ensure FCPA compliance.
Directors, officers, employees, agents or contractors whose work requires lobbying communication with any member or employee of a legislative body or with any government official or employee in the formulation of legislation must have prior written approval of such activity from the CCO.
As per our guidelines, company funds or assets must not be used for, or be contributed to, political campaigns or political practices under any circumstances without the prior written approval of the CCO and, if required, the Board.
Supply chain ethics
For information about how we work with our valued suppliers to maintain ethical standards, please see the “Supply chain management” section of the Social page of our website.
