KRAFTON develops plans to create a sustainable future focused on the environment, social and governance to grow the value of company and various stakeholders in the short and long term, and realizes them. In addition, KRAFTON practices sustainability by managing not only financial risks but also non-financial risks.

Environment

# Items Detailed
items
Activities
1.1 Environmental management system Environmental information disclosure
Disclosing green management organization, water and energy use, waste generation, etc.
for 2021 on the Environmental Management Information System
1.2 Operational environmental impact and eco-efficiency Energy consumption
Energy consumption by location for 3 years
Category Location Unit 2020 2021 2022
Direct energy Gas Yeoksam
(Office)
ToE N/A 9.64 23.95
Seocho
(Office)
ToE 21.18 17.82 14.14
Subtotal ToE 21.18 27.46 38.09
Indirect energy Electricity Yeoksam
(Office)
ToE N/A 235.93 988.96
Seocho
(Office)
ToE 125.25 130.00 120.63
Pangyo
(Office)
ToE 269.28 274.45 224.93
Seongsu
(Office)
ToE N/A 47.56 21.77
Pangyo
(Data Center)
ToE 0.11 0.22 0.26
Seongsu
(Rental)
ToE N/A N/A 62.94
Subtotal ToE 394.64 688.15 1,419.49
Total ToE 415.82 715.61 1,457.58
Energy intensity (*1) ToE/Rev. 0.02 0.04 0.08
Annual reduction rate (*2) % N/A (-)72.1% (-)103.7%
 (*1)
Computed with sales revenue in hundred million on consolidation basis
 (*2)
Reduction rate
Energy consumptions has risen as Yeoksam office was newly opened in July 2021.
Energy consumptions has risen due to shift from telecommuting to office work after COVID-19 in 2022.
1.3 Energy conservation
Encourage energy saving culture to employees through resource saving campaigns
Details of automatic power off setting
Large display in front of elevator: 22:00
Meeting room air conditioner (summer): 1st 20:00, all shut down 23:50
Lighting
Use LED lights (Pangyo, Yeoksam: Dimming function / Seocho: Only On-Off is allowed)
Meeting room lighting: Apply sensors, etc. to automatically power off when not using
1.4 Resources recycling
Using recyclable paper shopping bag for employees
Using A4 recycled paper
Use ‘recycled pulp’ that uses waste paper as raw material instead of ‘natural pulp’ when producing paper, Reduce greenhouse gas emissions from the ‘pre-manufacturing stage’ as ‘wood collection and cutting/processing stage’ have been excluded
1.5 Carbon emissions reduction
Operating shuttle bus
Shuttle bus use rate: about 120 applicants as of March 2023 (around 10%)
Shuttle bus
By office: Yeoksam, Seocho, Pangyo
Between stations: Gangnam Station, Yeoksam Station
Not operating vehicles for business purpose (corporate cars)
1.6 Resources conservation and environmental protection
Employee campaign (HUB notice)
Upload more than one post per quarter
Upload posts or ads about resource saving and environmental protection
Collecting Nespresso coffee capsules separately
Participate in recycling program run by Nespresso
Promoting using tumbler at in-house cafe
Provide coupon when tumbler is used
1.7 Management of climate change risks and climate-related opportunities GHG(Greenhouse Gas) emissions
GHG emissions by location for 3 years
Category Location Unit 2020 2021 2022
Scope 1 Yeoksam
(Office)
tCO2eq N/A 20.35 50.55
Seocho
(Office)
tCO2eq 44.71 37.61 29.85
Subtotal tCO2eq 44.71 57.96 80.40
Scope 2 Yeoksam
(Office)
tCO2eq N/A 489.06 2,050.05
Seocho
(Office)
tCO2eq 259.63 269.48 250.05
Pangyo
(Office)
tCO2eq 558.19 568.91 466.26
Seongsu
(Office)
tCO2eq N/A 98.58 45.12
Pangyo
(Data Center)
tCO2eq 0.23 0.45 0.54
Subtotal tCO2eq 818.06 1,426.48 2,812.03
Scope 3 Seongsu
(Rental)
tCO2eq N/A N/A 130.46
Total tCO2eq 862.76 1,484.44 3,022.89
Energy intensity (*1) tCO2eq/Rev. 0.05 0.08 0.16
Annual reduction rate (*2) % N/A (-)72.1% (-)103.7%
(*1)
Computed with sales revenue in hundred million on consolidation basis
(*2)
Reduction rate
Greenhouse gas emissions has risen as Yeoksam office was newly opened in July 2021.
Greenhouse gas emissions has risen due to shift from telecommuting to office work after COVID-19 in 2022.
1.8 GHG reduction
Using game server cloud service
Currently KRAFTON is using about 20,000 cloud (A**, M**) instances as of April 2023
Not operating own data centers due to using game server cloud service
A few physical servers for in-house information systems located in third-party’s data center with lease
Not significant greenhouse gas emissions

Social

# Items Detailed items Activities
2.1 Industrial safety and health Employee safety and health
Operating Industrial Safety and Health Committee (employee member, employer member / hold meetings on a quarterly basis)
Measure annual air quality (for all offices)
Conduct bake out when moving into the Seocho office
Company-wide training on AED heart defibrillator
Annual fire drill training (Yeoksam and Pangyo in 2022 / Will also hold at Seocho in 2023)
Detect wiretapping, eavesdropping and illegal filming (closed space, meeting room, rest room, etc.)
Install dimmable equipment by replacing lighting at Pangyo (2022)
Semi-annual risk assessment activities (industrial safety and health committee activities)
Addressing agenda discussed at Industrial Safety and Health Committee meeting such as elevator issues
Adopted ISOS services that provides comprehensive safety management services during overseas business trips starting 2022 (covers both business travelers/dispatch employees, 300 business trips in 2022)
Company policy on occupation safety and health
2.2 Human resources development Employee status
Diversity of employees
Category 2021.12.31 2022.12.31
Employees (*1) Team members Male head count 1,050 1,229
ratio 70.2% 69.4%
Female head count 446 541
ratio 29.8% 30.6%
Team leaders and above Male head count 208 238
ratio 81.6% 81.8%
Female head count 47 53
ratio 18.4% 18.2%
Foreign employees head count 48 88
(*1)
KRAFTON, Inc. members as of December 31, 2022 (excluding registered executives)
Employee turnover (*1)
Category 2022
Male Female Total Ratio by type of turnover
head count ratio head count ratio
By type Voluntary turnover (*2) 104 75.9% 33 24.1% 137 89.0%
Non-voluntary turnover (*3) 7 77.8% 2 22.2% 9 5.8%
Relocation to affiliates 7 87.5% 1 12.5% 8 5.2%
Total 118 76.6% 36 23.4% 154 100.0%
(*1)
Based on regular employees
(*2)
Regardless of the organization’s intention, it is an individual-led decision to leave the organization with all reasons except non-voluntary turnover and relocation to affiliates.
(*3)
A recommendation to resign, dismissal during probation, etc. through which work relationships are terminated mainly in line with the initiative of the organization.
The voluntary turnover rate in 2022 is 9.2%, which is the industry average.
2.3 Employee health promotion
Operating a system to promote employees’ health
Offer health check-up (employee and one family member)
Purchase a group insurance policy
Provide exercise expenses
2.4 Work and life balance
Implement a selective working hours policy
Flexible working hours, excluding core time from 11:00 AM to 4:00 PM
Implement a telecommuting policy
Operation of telecommuting at least once a week at the discretion of the team unit
Operating KRAFTON daycare center (Yeoksam, Pangyo)
Little Fore (max. 180)
Operating an approved leave system
Refresh leave, long service leave, medical check-up, moving, birthday, paid sick leave, etc.
Operating a self-approval leave system
94.3% of annual leave used (as of end-2022)
2.5 Pregnancy support programs
Providing reserved parking spots for pregnant employees
Operating nursing rooms
Providing maternity leave and leave of absence for parental needs
Reduction of working hours during pregnancy
Leave for prenatal health check-up
2.6 Employee family care
Congratulations and condolences
Providing congratulatory and condolence support for the wedding, death, birth, child’s admission to elementary school, etc. and support for congratulations and operating a congratulation and condolence leave system
2.7 Employee housing support
Interest-free housing loan
Housing loan interest assistance
Helping new employees settle in
Sharehouse
2.8 Fair employment
Established the anti-discrimination policy
Stated in Articles 4 and 5 of the Work Rules
2.9 Employee communication
Active Communication with employees
Gathering employees’ feedback and opinions through the Board of Communication(labor-management council) meeting every month from 2018 to the present(2023)
Held 12 times in 2021, discussing and dealing with 44 agendas
Held 12 times in 2022, discussing and dealing with 26 agendas
Held 12 times in 2023, discussing and dealing with 22 agendas
2.10 Employee satisfaction survey
Conducting employee satisfaction surveys
Resigned employees: Conducting a survey on workplace satisfaction and experience at the time of resignation
New employees: Conducting a satisfaction survey targeting new employees three months after joining the company
Employee benefits: Conducting a satisfaction survey on employee benefits
2.11 Employee education
Operation of support systems for certification acquisition and external education for all members, including part-timers and contractors
Offering training expense reimbursements of KRW 2M per person annually
Job training / Foreign language training / Self-improvement training
Operating ‘HELLO, KRAFTON’, an on-boarding Program for new employees
4 steps on-boarding program for new employees’ soft landing during 3 months
Operating core value training
Program for clear understanding and practice of vision and core values aligned with organization’s direction
Conducting training program performance measurement(satisfaction surveys)
Operating partnership with external training institutions
Operating status of the education system
Category 2021 2022 Rate of change
Job training Number of cases 392 918 ▲134%
Cost (in million KRW) 119 266
Foreign language training Number of cases 2,351 3,499 ▲49%
Cost (in million KRW) 197 346
Self-improvement training Number of cases 29 114 ▲293%
Cost (in million KRW) 6 24
Summary
Training system usage status Number of cases 2,722 4,531 ▲63%
Cost (in million KRW) 322 636 ▲67%
Number of users 591 961 ▲63%
2.12 Leadership education
Operating a program to strengthen leadership competencies
Training for newly-appointed leaders
Training for team leaders
Training for top management
Conducting training program performance measurement(satisfaction surveys)
2.13 Legal compulsory education
Providing Legal compulsory education once a year
Prevention of workplace sexual harassment
Personal data protection
Prevention of workplace bullying
Promotion of disability awareness
Retirement pension education
2.14 Employee Stock Ownership Plan
Started operations of Employee Stock Ownership Plan (ESOP) concurrent with KOSPI listing in August 2021
Operating status of Employee Stock Ownership Plan(ESOP) as of end of 2022
Corporate name Number of members by corporation (A) Total number of employees by corporation (B) Percentage of employee stock ownership association members by corporation
(*1)
Percentage of employee stock ownership association members by corporation to total employees (A)/(C)
KRAFTON 1,087 1,779 61.10% 48.99%
Bluehole Studio 139 187 74.33% 6.26%
RisingWings 92 124 74.19% 4.15%
Dreamotion 15 30 50.00% 0.68%
Thingsflow 10 99 10.10% 0.45%
Total 1,343 (C)2,219
(*1) Including individuals who applied for membership at the initial establishment of employee stock ownership association but currently do not hold any ESOP shares
2.15 Employee performance evaluation and reward
Performance review
Conducting performance reviews twice a year (mid-year, year-end)
Providing multi-faceted feedback to leaders
Operating stock-based compensation programs for all employees
RSU
Stock options
ELI
2.16 Talent nurturing
Business-education partnership
KAIST Jungle
Recuritment in progress every year through this program from April 2021
Internship program
AI Fellowship: An internship program for bachelor’s degree students in top domestic/overseas universities (Jun-Aug)
AI Research Internship
An internship program for master’s degree or PhD students in top domestic/overseas universities (Jun-Aug)
Hiring Interns in 2022 and conducting research with the aim of achiecing results
Internship on a rolling basis
Job posting and hiring on a rolling basis at the request of the team and will review transition to permanent employment if needed
2.17 Employment creation
Selected as a leading company for job creation
In 2019, 2020 and 2022
2.18 Respect for fundamental rights Human rights management
Human rights management policy
Code of Conduct Chapter 4 ‘Promise to Colleagues’
4-A. Respect for diversity and anti-discrimination
4-B. Workplace bullying and sexual harassment
4-C. Respect for the privacy of our employees
4-D. Feedback based on careful consideration
4-E. Protection of our members
2.19 Employee harassment report
Established a system to address employee harassment issues
Culture Team collects reports and provides counseling (workplace harassment, sexual harassment, etc.)
Collects reports via HUB or email. The process is announced on HUB.
Employee harassment issues are addressed based on the company policy (Workplace sexual harassment/bullying prevention and response policy)
A formal investigation is conducted by Compliance Dept. The investigation results and review committee’s feedback is shared with internal directors
Operating Speak Up
Can file reports on HUB or the company’s website
Business Assessment Office to first review the case and request Compliance Dept. to review it if it is deemed that the case should be handled by Compliance Dept.
After the review, discuss disciplinary actions and measures to prevent a recurrence if necessary (consultation with HR)
Report the final investigation results to management (Chairman)
5 cases were reported and processed in 2022 (100% completed)
2.20 Employee Mind Care
Employee Mind Care
Psychological counseling program to help employees address issues such as job and interpersonal stress, mental health, personal concerns, and addiction
Outsourcing Mind Care program via a specialized organization with 280 centers nationwide
2.21 Fair competition Unfair competition or anti-competitive
Company policy on unfair competition or anti-competitive
Code of Conduct Chapter 5 ‘Promise to partners’
5-A. Compliance with fair trade and competition laws, etc.
5-B. Pursuit of cooperation
Conduct risk management related to unfair competition or anti-competitive
Identifying risk-related business sectors and relevant departments
Analyzing legal risk and understanding the status of compliance control
Implementing detailed compliance checks for major legal risks
Conducting unfair competition or anti-competitive education
Education on group of large-scale enterprises
Targeting the finance department and subsidiaries
Training on precautions such as overview, disclosure, and reporting related to internal transactions
Education on unfair competition
Targeting the business department
Training on overview of regulations on unfair trade practices, detailed types, and precautions
Education on precautions for subcontracting transactions
For business department
Training of subcontracting definition, regulatory trends, and dispute prevention checklist
2.22 Improvement of consumer satisfaction Protection of consumer rights and interests
Company policy on consumer rights and interests
Code of Conduct Chapter 1 ‘Promise to fans’
1-A. A game made with craftsmanship
1-B. A healthy game
1-C. Continuous and stable service
1-D. Open communication with fans
1-E. Protecting personal information
Consumer rights protection activities
Processing of civil complaints in the event of a dispute over consumer rights and interests(187 cases handled in 2023)
Promoting the protection of consumer rights and interests by providing information on suspects in the case of investigative agencies(37 cases handled until 2023)
Responding to complaints from the Korea Consumer Agency to protect consumer rights and interests(11 cases handled until 2023)
2.23 Local community engagement and development Social contribution
Refer to ‘CSR’ page
Company policy on CSR
Details and achievements of community contribution activities
2.24 Data protection and cyber security Data protection system
Company policy on information security and privacy
Code of Conduct Chapter 1 ‘Promise to fans’
1-E. Protecting personal information
Composition and Operation of the security and privacy department
Designation of a Chief Information Security Officer (CISO) based on Article 45-3 of the Act on Promotion of Information and Communications Network Utilization and Information Protection, and Article 36-7 of the Enforcement Decree of the same Act.
Designation of a Personal Information Protection Officer (CPO) based on Article 31 of the Personal Information Protection Act and Article 32 of the Enforcement Decree of the same Act.
Establishment and operation of a dedicated organization to systematically oversee and implement the company’s information security activities.
Risk Management Plan
Identification, evaluation, improvement, and management of administrative, physical, technical, and legal risks for information and personal information protection.
Operation of Education and Awareness Enhancement Programs
Privacy protection training
For new employees (once a month upon hiring)
For all employees including contractors (once a year)
IT/Privacy and Security Job-specific Training
For engineering positions (at least once a year)
2.25 Data protection certification
External audit for IT security (once a year)
ISMS-P certification (Information Security and Personal Information Protection Management System certification)
A system where the Korean Internet & Security Agency (KISA) or certification bodies verify that a series of measures and activities for information security and personal information protection comply with certification criteria, based on Article 47 of the Act on Promotion of Information and Communications Network Utilization and Information Protection
The initial certification is valid for 3 years (subject to annual post-assessments to evaluate the effectiveness of the certification), and subsequent assessments are conducted for either initial or renewal certification.
Current certification status for KRAFTON:
ISMS19-014 (2019.04.01. ~ 2022.03.31.)
ISMS-P-2022-005 (2022.03.02. ~ 2025.03.31.)
2.26 Creation of an environment for data protection
Running data protection-related campaigns
Providing pocket guide to data protection
2.27
Data protection activity
Management of information security regulations and development and revision of guidelines (once a year or as needed)
Conducting Information Security Audits and Inspections to Validate and Improve the Effectiveness of Security Regulations and Activities (once a year)
Regular Vulnerability Assessments and Improvements for Information Security and Personal Information Protection (at least once a year, as needed)
Conducting Breach/IT Disaster Simulations for Ensuring Service Continuity (once a year)
Supervision of Personal Information Processing Contractors (once a year)
Notification of Personal Information Usage History (once a year)
Subscription to Personal Information Protection Liability Insurance (ongoing)
Implementation of Technical, Administrative, and Physical Security Measures for Personal Information Protection (ongoing)
Establishment and operation of account and authorization management processes
Application of secure authentication/access methods
Encryption policy and management
Log retention and management, review
Designation and management of secure areas
Implementation of Information Security and Personal Information Protection Operation Reports (once a month)
Management of Personal Information Processing Records (ongoing)
Disclosure of Matters related to Personal Information Processing Outsourcing, Third-party Provision, and Overseas Transfers (ongoing)
Selected as an Excellent Company for Information Security Investment by KISA for four consecutive years from 2020 to 2023.
Year Information Technology Sector Investment Amount in KRW (A) Information Security Sector Investment Amount in KRW (B) The Ratio of Information Security Investment (B)/(A)
2019 42,820,009,906 1,160,862,906 2.71%
2020 54,410,540,138 2,354,056,056 4.3%
2021 202,174,339,648 4,061,590,356 원 2.0%
2022 250,368,422,140 6,443,565,101 2.6%

Governance

# Items Detailed
items
Activity
3.1 Corporate governance Corporate governance
Corporate governance
Governance‘ page
Refer to ‘Corporate Governance Report‘ disclosed on May 31, 2023
Board Skills Matrix
Refer to ‘Governance‘ page
3.2
Shareholder Return
Establishment of a three-year shareholder return policy for 2023-2025 through a board resolution on February 7, 2023.
Acquisition of treasury shares within a limit of 40% of the amount excluding investment from the previous year’s Free Cash Flow (FCF) each year
In 2023, 100% of the acquired treasury shares were retired
Plan to retire at least 60% of the treasury shares acquired in 2024-2025
3.3 Business ethics Speak Up policy
Operating Speak Up
Can file reports on HUB or the company’s website
Business Assessment Office to first review the case and request Compliance Dept. to review it if it is deemed that the case should be handled by Compliance Dept.
After the review, discuss disciplinary actions and measures to prevent a recurrence if necessary (consultation with HR)
Report the final investigation results to management (Chairman)
5 cases were reported and processed in 2022 (100% completed)
3.4 Compliance activities
Annually conducting a compliance audit in each area
Conduct legal risk assessment and compliance control status checks by selecting 10 critical items such as governance, ethics, fair trade, and information protection, etc.
Conducting control activities regarding compliance and ethics in each operation
Prepare a compliance control system report and a semi-annual compliance report once a year and report to the management
3.5 Employee ethics improvement
Spreading the Code of Conduct
Conducting code of ethics training for new employees, including full-time and contract workers
Providing compliance training sessions such as the prevention of insider trading
3.6 Practice and promotion of gaming ethics
“Chapter 1 A Healthy Game” in the Code of Conduct
Posting a notice about violations of in-game ethics
Reviewing the ethical appropriateness of vendors when pursuing collaborations
Running campaigns to prevent gaming violence
3.7 Fraud prevention
Prevention of bribery and corruption
Run related campaigns
Send Chuseok Holiday Gift announcements
Send in-house manners campaign e-mails
Review and answer relevant inquiries from employees
Inquiries related to the Code of Conduct (gifts, entertainment, unfair trade, conflict of interests, etc.)
Inquiries related to the amendment and interpretation of the Code of Conduct
Inquiries related to various Compliance-related systems such as the Pre-notification of Stock Trades by Officers and Employees
Conducting anti-corruption work through the Business Assessment Office which is an independent internal audit department
Conducting consulting and investigation
Communicate the Business Assessment Office’s role, responsibility, authority, independence, objectivity and work scope to all employees through the Business Assessment Charter
Anti-bribery and embezzlement policy
Code of Conduct Chapter 2 ‘Promise to the company’
2-D. Prohibiting illegal solicitation/bribery
Code of Conduct Chapter 3 ‘Promise to investors’
Embezzlement and breach of trust