Sustainability > Sustainable Management > Corporate Social Responsibility

SangSang Fund

KT&G’s unique donation culture made of employee’s voluntary participation and reward of good deeds Donation Petition

SangSang Fund is a social contribution fund raised by the voluntary participation of KT&G employees. When employees donate part of their monthly salary, the company matches the same amount. The overall process, ranging from fund-raising to operations, discovery of donation recipients and sponsorships, is carried out through the voluntary participation of employees. Since its adoption in 2011, the SangSang Fund has formed a cumulative total of KRW 43.8 billion, including KRW 3.9 billion raised in 2023. The raised SangSang Fund is used to support vulnerable social groups and solve social problems through donation petition and donation market programs. The SangSang Fund Management Committee, composed of 11 employee representatives, deliberates, and makes decisions on the donation agenda to ensure transparent operation. Supports for large-scale social problems such as natural disasters are determined by a committee resolution, and funds for social contribution to increase intimacy with the community are executed voluntarily by KT&G local organizations across the country, contributing to diffusing a culture of sharing.

Overview of SangSang Fund

Donation Petition

The donation petition system allows employees to uncover stories of marginalized groups in welfare blind spots and post them on the internal bulletin board. If a story gathers more than 200 supportive comments from employees, the subject of the story receives support. Introduced in 2013, thanks to the participation of many employees, we have been supporting various fields such as medical support, housing environment improvement, and education for marginalized groups who find it difficult to receive support through welfare institutions.
Donation Market

Donation Market is a participation-based donation program that enables employees to select a donation receiver among the candidates collected from various channels such as NAVER Happybean, KT&G Welfare Foundation, and recommendations from local organizations. Started in 2015, the Donation Market program has conducted activities to solve a wide range of social issues in various fields, such as overseas relief and improvement of environmental problems, in addition to the welfare improvement of the underprivileged.
Engagement
by Local
Organizations

KT&G operates businesses nationwide, with some 20 sales headquarters and plants leading communitybased sponsorship projects. As employees who are familiar with the community find the donation receiver, practical support and customized social contribution activities can be made. In 2023, KT&G executed a total of 276 nationwide support initiatives, encompassing areas such as medical expenses, essential daily provisions, enhancement of living conditions, and year-end charitable endeavors. These efforts were directed towards the elderly, disabled individuals, and multicultural families, and were facilitated through local welfare institutions. A sum of approximately KRW 1.5 billion from the SangSang Fund was allocated for these activities.
Major 2023
Support Cases
by the SangSang Fund

KT&G donated KRW 300 million each to the Korean Red Cross and the Korea Disaster Relief Association for relief efforts following the earthquake in Türkiye in February 2023 and the wildfire in Gangneung, Korea in April 2023. The donated funds were used to support housing and relief supplies for the disaster victims. Additionally, KT&G donated about KRW 300 million for drinking water supply for low-income groups and the creation of the “SangSang Forest.” The funds were used for drinking water supply projects for low-income groups in Uganda and for forestation projects aimed at carbon reduction and preventing desertification in Mongolia.

Raising and Execution of SangSang Fund in 2023

SangSang Fund Operational Committee: KRW 1,670million

Donation Market: KRW 690million

Local Organizations: KRW 1,530million

Donation Petition: KRW 10million

Total: KRW 3,900million

Global CSR Activities

We fulfill responsibilities as a global corporate citizen to become a truly global top-tier player.

As KT&G’s global expansion gains speed, its roles and responsibilities toward local communities around the world are also growing. KT&G is fulfilling social responsibilities as a global corporate citizen by carrying out social contribution activities in diverse countries, including countries where its businesses have a presence. We provide emergency disaster relief overseas and conduct country-tailored social contribution activities, in addition to Korean language education, Korean culture dissemination activities, and job support activities. We are providing help that is needed around the world in accordance with our unique social contribution value system.

Country-Tailored CSR Activities

KT&G implements tailored CSR activities globally to address social and environmental issues faced by local communities. In 2023, particularly after a major earthquake in Türkiye, where a KT&G manufacturing plant is located, we donated tents and relief supplies worth about KRW 300 million to help set up temporary shelters and provide emergency supplies for affected local residents. Additionally, with a target completion in the first half of 2024, KT&G has initiated a project to provide water purification devices to Uganda, where there is a critical need for clean drinking water. In Mongolia, facing severe environmental challenges due to desertification, KT&G has been working since 2022 through the Agroforestry Training Center in Mongolia, established by the KT&G Welfare Foundation. Together, we have developed urban forests under the KT&G SangSang Forest initiative, completing a second forest comprising 5,000 trees in 2023.

KT&G is also dedicated to improving educational conditions in global communities. In Kazakhstan, where KT&G has recently expanded its operations, the company opened a Korean language school in June 2023. This school provides Korean language education to both local residents and Korean descendants and organizes a variety of activities to foster Korean cultural exchange, such as Korean speech contests and writing competitions. Additionally, KT&G is enhancing school facilities in Vietnam and Indonesia, and implementing scholarship programs for local university students in Indonesia, Türkiye, and Kazakhstan.

Total of 14countries, KRW25.4billion

* As of the end of 2023, and cumulative basis

Eco-friendly CSR

KT&G is reducing its environmental footprint while raising social value,
thereby developing into an ESG-leading company.

KT&G is actively looking into ways to reduce its carbon footprint in the process of use and disposal of our products. We encourage stakeholders to participate in and identify with our efforts to find measures, thus fulfilling our social responsibilities and making diverse efforts to create social value. In addition, we are carrying out various social contribution activities to protect and restore the natural environment to improve environmental issues, which have become a global task.

Smoking Environment Improvement Program

KT&G has been carrying out the smoking environment improvement program for more than a decade to actively fulfill social responsibilities in an area that is related to its business. As a leading activity, we are building an infrastructure (smoking room, cigarette butt collection box, portable ashtray) to establish a clean street environment and make environmental improvements by eliminating illegal littering of cigarette butts. We are expanding the establishment of smoking rooms at major publicly-used facilities, including airports, train stations, and large public facilities. We have set up a cumulative 591 smoking rooms across the nation, including the 80 rooms established in 2023. To more effectively prevent illegal littering of cigarette butts in areas that are difficult to set up a smoking room, such as narrow alleyways, we supported the establishment of cigarette butt collection boxes. We commenced a pilot project in 2021, followed by the installation of a total of 3,924 cigarette butt collection boxes by the end of 2023 in major cities around the nation, including Seoul and Busan. In addition, we are producing and distributing portable ashtrays and have distributed around 220 thousand ashtrays in collaboration with local governments and environmental NGOs since 2022, through which we expect to raise consumer awareness and improve smoking habits.

Ssudam Ssudam Campaign

KT&G runs the “Ssudam Ssudam Campaign” to build an infrastructure that helps prevent illegal littering of wastes, including cigarette butts, while raising consumer awareness. Meaning “please throw away your cigarette butts in the trash can,” the Ssudam Ssudam Campaign is an environmental campaign that has been continuously carried out since its implementation in 2020 based on the suggestions made by the SangSang Realization Committee (currently Junior Board), a corporate culture improvement organization. Since May 2021, we have been applying the Ssudam Ssudam pictogram that encourages the practice of smoking manners to all products sold in Korea (around 70 types). In addition, we set up Ssudam Ssudam Campaign posters at convenience stores (around 46,000) across the nation, and attached campaign slogans to 1,200 business fleets.

Smoking Environment Improvement Program

Installation of smoking room: 591smoking rooms,

KRW 8,020million

(2011~2023)

Installation of cigarette butt collection box: 3,924boxes,

KRW 760million

(2011~2023)

Distribution of portable ashtray: 222,000ashtrays,

KRW 1,550million

(2022~2023)

* As of the end of 2023, and cumulative basis

Natural Environment Preservation Program

Forestation projects in Korea and overseas

Since 2006, KT&G has consistently engaged in forestry CSR, contributing to the improvement of forest environments in Korea and abroad. As a first step, from 2006 to 2012, volunteer activities were initiated to plant 38,000 trees in the Naksansa Temple wilsfire-damaged area in Yangyang County, Gangwondo. From 2013 onwards, 14,000 trees have been planted for ecological restoration of Bukhansan, along with the removal of harmful plants. Following the forest restoration through volunteer activities, KT&G expanded its scope to support communities affected by wildfires. In 2019, KRW 500 million was donated for the relief of victims of the Goseong/Sokcho wildfire, KRW 50 million was provided in 2021 for the restoration of wildfire damage in Türkiye, and KRW 500 million was donated in 2022 for the relief of wildfire victims in Uljin/Samcheok.
From the first generation focused on restoring damaged forests, and the second generation supporting disaster victims during major wildfires, in 2022, as part of its strategic ESG management efforts, KT&G launched the “KT&G SangSang Forest” creation project. In 2023, a KT&G SangSang Forest was established in Mongolia, one of countries where we operate our business. The forest creation costs in each country were funded through the SangSang Fund, collected through voluntary contributions from KT&G employees, and were carried out in conjunction with domestic and international employee volunteer activities, striving to fulfill the management philosophy of an “Inclusive Company.”

Achievement of Forestation Project in 2023

Value of the SangSang Forest in Bonghwa-gun created in 2023

CO2 absorption of

54,000kg/year
Fine dust absorption of

110kg/year

Value of the SangSang Forest in Mongolia created in 2023

CO2 absorption of

862.2tCO2eq/year
Desertification prevention effect of

5.2ha
(equivalent to the area of 7 soccer field)

Biodiversity Conservation

In 2022, KT&G signed an MOU for “Ecosystem Conservation and Biodiversity Promotion” with the National Institute of Ecology. Starting in 2023, they initiated a three-year mid-to long-term cooperation project. In line with this agreement, KT&G annually plans and executes activities with the National Institute of Ecology to protect ecosystems and restore biodiversity. In the first year of collaboration in 2023, KT&G promoted wetland protection activities in Janggumeogi Wetland located in Yeongyang County, near the Yeongju Plant. Janggumeogi Wetland, a mountainous wetland of approximately 38,000m², is a biologically rich habitat undergoing a detailed wetland survey by the National Institute of Ecology’s Research Center for Wetland for the proposed designation as a protected wetland area. However, due to soil influx and scouring caused by surrounding roads, the habitat has been damaged, reducing biodiversity. KT&G and the National Institute of Ecology completed the restoration work and will continue research on the species inhabiting the area. Furthermore, in 2024, the second year of the project, a restoration initiative for the black stork—designated as Natural Monument No. 200 and a Class I endangered species—will be undertaken. This effort will be part of ongoing collaborative activities aimed at protecting endangered plants and animals and conserving their habitats, thereby fostering more diverse and secure biodiversity.

Overview of the 1st Year Projects for the MOU
on Ecosystem Conservation and Biodiversity Promotion

Target Area: Janggu catfish wetland
nearby the Yeongju Plant

Restoration Area: Approximately
38,000 m²

Major Species identified

Endangered Species Level II

1 bird species (Eurasian goshawk)

3 mammal species (yellow-throated marten, leopard cat, Siberian flying squirrel)
National Red List Near Threatened (NT)

1 inset species (migrant hawker)
National Red List Least Concern (LC)

3 plant species (trigonotis icumaevine, eleutherococcus divaricatus var. chiisanensis, lysimachia coreana Nakai)

7 insect species (agelastica coerulea Baly, etc.)

Marine Ecosystem Protection

To address the issue of marine pollution caused by marine debris, KT&G has been collaborating with the Korea Marine Environment Management Corporation since 2021 to carry out a marine ecosystem protection project. In the first year of the project in 2021, activities were conducted including underwater trash clean-up by professional divers and coastal clean-up by employee volunteers. In 2022, the scope was expanded to the “Adopt-A-Beach” program organized by the Korea Marine Environment Management Corporation, a project where companies adopt beaches in need of environmental protection and care for them through clean-up activities, similar to caring for pets. The scope of program increased from four beaches in 2022 to six in 2023, making them clean and beautiful through trash collection and landscape improvement activities.

2023 Performance of the “Adopt-A-Beach” Program

Collected waste: Approximately 21 tons

Volunteers: 916 persons

Junk art exhibition visitors: 1,536 persons