Evolution Builder - Amazon Simple Storage Services3.amazonaws.com/zanran_storage/ · As of 2010, DSME is composed of one shipyard, four divisions, three units (Corporate Ethics Office

DSME

2009 Environmental and Social Report

Evolution Builder

Building a better world together

Reporting Objective

DSME has published Environmental & Social Report

annually since 2005. Our fifth report intends to disclose

information on our sustainability management to

stakeholders transparently where environmental, social and

economic factors are considered in a balanced manner.

Reporting Scope and Period

This Report, in principle, covers the environmental

management and social contribution activities of the head

office and Okpo Shipyard from January 1, 2009 to

December 31, 2009. The activities of our affiliates and joint

ventures are not included.

General Information on This Report

This Report is published both in Korean and in English. You

can download the Report at our homepage

(www.dsme.co.kr). In case you want to receive a copy,

please contact us (see contact information below). Your

valuable feedback will be reflected in our sustainable

management. You can set forth your views through Reader

Survey (see page 57 of this Report), by email, or by phone.

Reporting Guidelines

This Report was prepared based on GRI G3 Guideline and

Ministry of Environment Environmental Report Guideline.

Contact Information

Address: HSE Operation Team, Environmental

Management Group, DSME, Aju-dong 1,

Geoje-si, Gyeongsangnam-do, 656-714, Korea

Tel: +82-55-680-2668

Fax: +82-55-680-2177

E-mail: [email protected]

About This Report

CONTENTS

Sustainability of DSME

Environmental Performance

Social Performance

Appendix

About This Report 00

CEO Message 02

Company Overview 04

Corporate History 05

Organization and Network 06

Major Performances in 2009 08

Corporate Governance 10

Ethical Management 11

Quality Management 12

Stakeholder Communication 13

Economic Performance 14

Vision and Strategy 16

New Growth Engine for Sustainable Growth 18

Environmental Management 22

Activities and Performance 28

Employee Satisfaction 40

Safety and Health 45

Social Contribution 52

Awards and Recognition 55

Environmental Report Guideline 56

DSME2009 Environmental and Social Report

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CEO MESSAGE

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02

03

We will uphold our priority on the environment

regardless of the external circumstances. DSME will continue to

practice environmental management and seek opportunities in

green businesses to propel further advances.

To our stakeholders

October 2009 to pursue the project using carbon dioxide

capture technology. Moreover, we are conducting joint

research to develop “green ships”featuring engines powered

by eco-friendly natural gas. To DSME, protecting the

environment is not just a responsibility but a means of

creating new business opportunities.

We believe environmental management is an inherent part of

fulfilling our social obligations. We are carrying out the “one

company, one coast”protection campaign to preserve the

marine ecosystem of the Geoje region. DSME also strives to

promote environmental management among its business

partners via green partnerships. Consulting is provided so

that our partners can develop policies and activities suited to

their respective firms. We are convinced that efforts to

protect the environment and advance society are essential for

sustainable growth.

With shadows of uncertainty still looming over the global

economy, we may have to endure more tough times ahead.

Nevertheless, we will uphold our priority on the environment

regardless of the external circumstances. DSME will continue

to practice environmental management and seek

opportunities in green businesses to propel further advances.

Our stakeholders play a valuable role in our pursuit of

sustainable growth. I humbly ask for your guidance and

encouragement as DSME pursues its vision of transforming

into a comprehensive heavy industries group by 2020.

CEO, DSME

Nam, Sang Tae

Dear stakeholders,

I am pleased to present Daewoo Shipbuilding and Marine

Engineering’s Environmental and Social Report 2009. This is

the fifth report detailing DSME’s commitment to

environmental management and social contribution.

In 2005, DSME was the first shipbuilding company to publish

an environmental report. Since then, we have communicated

our efforts to preserve the planet and activities to fulfill our

social responsibilities through subsequent reports released

on a yearly basis.

Our eco-friendly activities can be traced back to 1991 when

we created our environmental preservation department,

which was a first for the shipbuilding industry. Then in 1996,

we announced our pledge to realize a green shipyard. The

following year, DSME became the first shipbuilder to acquire

ISO 14001 certification for environmental management.

The HSE Improvement Committee chaired by the Shipyard

General Manager is responsible for setting environmental

goals and reviewing matters related to health, safety and the

environment. Guidelines have been distributed to ensure a

prompt and accurate response in the event of an

environmental accident, and we carry out internal monitoring

to prevent pollution.

In addition to environmental stewardship, DSME is exploring

ways to develop new businesses to promote “low carbon,

green growth”which is receiving the global spotlight. In line

with this stance, we acquired US-based DeWind in August

2009 to expand into the wind power industry. In March 2010,

we signed an agreement to supply wind turbines and

construct a factory with the provincial government of Nova

Scotia, Canada. Another way we are seeking to reduce

greenhouse gases is by building a zero emission power plant.

We concluded an agreement with Sargas AS of Norway in


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COMPANY OVERVIEWCORPORATE HISTORY

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04

05

Company Name Daewoo Shipbuilding & Marine Engineering Co., Ltd.Starting Date for DSME Okpo Shipyard Construction

October 11, 1973

CEO Nam, Sang Tae

Head Office85, Da-dong, Jung-gu, Seoul Phone 82-2-2129-0114, Fax 82-2-2129-0077~8

Shipyard1, Aju-dong, Geoje-si, Gyeongsangnam-do, Korea Phone 82-55-680-2114 Fax 82-55-681-4030DMHI: Daewoo Mangalia Heavy Industries, In RomaniaDSSC: In ChinaDSEC: In Busan, Korea

Subsidiary WELLIV: In Geoje, KoreaCompanies DSME E&R: In Daejeon, Korea

DSME Construction: In Seoul, KoreaSHINHAN Machinery: In Ulsan, KoreaDEWIND: In USA

Revenue KRW12.4 trillion (plan for 2010)Yard 4 million square metersEmployees 31,000

Commercial Vessel 70 Vessels/YearProduction Capacity Specialty Vessel 10 Vessels/Year

Offshore & Onshore Plant 30~40 UnitsTanker, LNG & LPG carrier, Container

Commercial Vessels carrier, Roll-on roll-off carrier, Chemicalcarrier, Product tanker, Passenger ferry,and others

Major Products Fixed platform, RIG, FPSO/FPU/FSO for Offshore Plant Offshore Oil and Gas Exploration &

ProductionSubmarine, Destroyer, Battle ship,

Specialty Vessels Submarine rescue vessel, AUV, and otherspecialty vessels

DSME has grown into a global shipbuilding and marine company

based on excellent technologies and optimal facilities.

┃General information┃

Company Overview

1970 1980 1990 2000

2001 World No.1 in LNG carrier orders

1989 Business Innovation Movement "Vision 90s"1981 Held ceremony to mark completion

of Okpo Shipyard1973 Groundbreaking ceremony for Okpo Shipyard con-struction by Korea Shipbuilding & Engineering Corp.

Location

2006 Selected for best corporate governance for the 4th year in a row

2005 Received the Korean Best Corporation Awards

2003 Named the world's best shipbuilder from Lloyd's List Maritime Asia

2009 Won US$10 billion Export Tower / Established DeWind Co. (wind power company)

2008 Opened the era of US$10 billion sales

This is our growth path for the past 37 years. Top-tier position in

the world shipbuilding industry has been achieved through our

core values, “passion” and “trust.”

Corporate History

01. Establishment of DSME1973 Groundbreaking ceremony for Okpo Shipyard

construction by Korea Shipbuilding & EngineeringCorp.

1978 Acquired Okpo Shipyard and established DaewooShipbuilding & Heavy Machinery Co., Ltd. (DSHM)

1979 Built first chemical carrier1981 Held ceremony to mark completion of Okpo

Shipyard1983 Completed construction of Dock II

02. Business Innovator Movement1984 Established Ship & Marine Technology Research

Institute and acquired several internationalcertifications

1985 Launched MAST Business Innovation Movementand construction of a double hull 300,000-ton VLCC(world first)

1987 Established of Daewoo Shipbuilding labor union1988 Initiated self-recovery efforts and rationalization

measures for shipbuilding industry1989 Launched business innovation movement, ‘Hope

90s’

03. The World's Best Shipyard1991 Recorded first profit since the establishment1992 Normalized business and acquired ISO 9001

certification1993 Ranked No.1 in amount of orders for ships

Built Korea's first battle submarine1994 Merged with Daewoo Heavy Industries Ltd1997 Acquired environment management certification ISO

14001

04. Under a Workout Program1998 Succeeded in building battleship

Exported passenger ferries for the first time1999 Presidential award for precision technology and One

Hundred Technology Award Workout programme as part of the Daewoo Group'srestructuring move

2000 Spin-off of Daewoo ShipbuildingStarted 'Global Top 2010' Business Innovation Movement to create a new 100-year history

2001 Graduated from the workout programMoved into new company buildingBecame the global leader in winning LNG carrierorders

05. To be the Best2002 Selected corporate core values: 'Trust' and 'Passion'

Commenced the PI project2003 Named the world's best shipbuilder from Lloyd's List

Maritime Asia 2004 Operated PI system for the first time in the

shipbuilding industryOpened Future Leadership Center

2005 Became the world’s first to construct and deliverLNG-RVWon Transparent Management Grand Prize from thefive economic organizationsSelected as the best corporation in the Korea BestCorporation AwardsThe LNG-RV was selected as one of the top 10 newtechnologies by the ministry of Commerce, Industryand Energy

06. Embracing the World2006 Operated DSSC

Received orders over US$ 10 billionSelected for the best corporate governance for the4th year in a row

2007 Received the award for 'Transparent Management'Received the Grand Prize at the '2007 Labor-Management Cooperation Awards'Won US$ 6 billion Export Tower Award at the 44thTrade Day Ceremony

2008 Established Seyoung Educational Foundation(Geoge College) Recorded sales of US$10 billion

2009 Won US$ 10 billion Export Tower Award at 46thTrade Day Ceremony Established DeWind Co.

2010

06

07


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ORGANIZATION AND NETWORK

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Organization and Network

As of 2010, DSME is composed of one shipyard, four divisions, three units (Corporate Ethics Office

was established in 2009), one research institute, and 34 teams. With a new grand team system that

took, root in the company in 2009, fast decision-making and speed management became possible

through integration of overlapping works, strengthening roles of team leaders, and reduction in

approval steps, thus enabling us to respond easily to the rapidly changing business environment.

Furthermore, we operate an independent quality management team and HSE team in order to

enhance product quality and pursue HSE management in a more effective manner.

DSME secures its global competitive edge through operating

subsidiaries both in Korea and abroad while creating new

business opportunities.

CTO (Technology)

CPO (Production)

GeneralManager ofShipyard

CorporateEthics Office CFO (Finance)

CBO(Business)

CSO(Strategy) Corporate Unit. COO

(Operation)

BODCEO

Audit Committee

HSE OperationTeam

Quality Management Team

Industrial ApplicationR&D Institute

Organizational chart

┃DSME’s subsidiaries┃

DSME operates eight subsidiaries. In 2009, DeWind Co. became a member of DSME.

The subsidiaries are expected to play pivotal roles as we are strengthening the new businesses

such as wind power and energy development.

┃Global network┃

DSME operates 10 branch offices worldwide that are located in Houston, the epicenter of the E&P

business in the US, as well as Athens, etc.

Oslo

London

MangaliaShandong (DSSC)

Seoul (DSC)

Daejeon (DSME E&R)

Ulsan (Shinhan Machinery)

Busan (DSEC Co., Ltd.)

Geoje (Welliv Co., Ltd.)

Houston

●Subsidiary●Branch Office

Tokyo

Shanghai

Perth

Greece

Luanda

Nigeria

Dubai

DeWind

DeWind Corporation

After acquiring the shares of DeWind Turbine,DSME established DeWind Corporation in 2009.The U.S.-based wind power company,specializing in wind power business, runs adevelopment center in Germany while doingdiverse businesses such as wind power plantconstruction, product development and sales inthe US and Europe. Before the acquisition, thecompany was a subsidiary of CTC (CompositeTechnology Corp.), a listed company onNasdaq. The company successfully developed750 kilowatt, 1.5 megawatt and 2 megawattturbines to provide 710 turbines (760 megawatt)in Europe, China, South America, and the US.

08

09


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MAJOR PERFORMANCES IN 2009

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1. Mobile robotic system for cherry pickerDSME developed a robotic system that carries

out works such as painting, cleaning, pre-

processing, and inspection on the cherry

pickers. The system is expected to enable us

to work in a more safe and efficient manner.

2. First DSME designed drillship modelWe started production of no. 3601, Our first

DSME designed drillship. This drillship can drill

from 10,000 to 40,000 feet underwater. As

such, it will be conducive to securing the

strong drillship market in the coming years.

3. Research center for unmannedunderwater vehicle

The Future Product Business Development

Institute of DSME and Geoje College opened a

research center to to secure an onsite test

base for the UUV (Unmanned Underwater

Vehicle) that is currently under development.

Experts in the area of UUV are expected to be

nurtured while the infrastructure of relevant

industries is anticipated to strengthen,

accordingly.

4. DSME and Korea Gas Corp. (KOGAS)signed an MOU on research anddevelopment related to DME FPSO

Under the terms of the MOU, R&D will be

conducted in collaboration with KOGAS to

develop core technology for topsides of DME

FPSO, regarded as a promising offshore

product in the future. DME is the abbreviation

of dimethyl ether. It is an eco-friendly,

alternative energy source like LPG and diesel.

It is a compound that does not exist in the

natural world but can be made from various

energy sources such as natural gas, coal, and

biomass.

5. World's largest floating dock (RD#4)completed

The world's largest floating dock, DSME Royal

Dock #4 (RD#4) was completed. The dock is

designed to have a floatage capacity of

120,000tons, and measures 438 meters long

and 84 meters wide.

6. Launch of world's largestcontainership (14,000 TEU)

DSME completed and delivered the world's

largest containership of a 14,000 TEU vessel.

Boasting a length of 365.5m, the containership

is 35m longer than a VLCC and 20m longer

MajorPerformances in 2009

1

2

38

than an LNG carrier (260,000㎥). With a width

of 51.2m and depth of 29.9m, it can carry

14,000 containers (each 20 feet) and sail at a

speed of 25 knots (46.3㎞/h).

7. Vessel Monitoring System inoperation, first in the industry

The integrated Vessel Monitoring System

(VMS) was put into operation. This is the first

time this kind of system has been implemented

in the shipbuilding industry, which has been

designed to monitor not only the present status

of major ships in the Okpo bay through GPS,

but also to estimate the arrival time of block

carriers, barges, etc., thus enhancing the

operational efficiency and preventing potential

accidents in advance.

8. Application of the one-time settingmethod for Goliath cranes using aparallel floating crane

900 ton ultra-large Goliath crane was installed

by using a parallel floating crane. We

succeeded in applying the one-time setting

method. This was the first time this has been

attempted in the global shipbuilding industry.

The new method cut down the installation time

to just one week from the two months it took

using the previous method.

9. Construction of the most advancedGBS assembly plant

DSME's new assembly plant, named Grand

Block Shop (GBS), has gone into operation with

an annual production capacity of 130 thousand

tons of large scale blocks for 2010 (150

thousand tons in 2011). The No.5 GBS is the

largest plant in DSME and is equipped with a

360 ton large-sized crane. It is around 61,500㎡in area, where three assembly plants, an

inspection shelter, and an outdoor PE plant are

located.

10. Cost reduction through PSM ActivitiesSetting 2009 as the year for "activating

companywide PSM activities," DSME strived to

reduce costs. As a result, we cut material costs

by KRW228.5 billion in 2009 (accumulated

amount is KRW702.9 billion).

11. Super-large containership anddrilling rig were selected as "2009World Class Product of Korea"

8,000 TEU super-large containership and

drilling rig were chosen as "2009 World Class

Product of Korea." Thus, we hold a total of

seven world class products including

merchant ship (selected in 2001), LNGC (in

2002), and LNG-RV (in 2007).

4 7 9

6 11

5

10

11


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CORPORATE GOVERNANCEETHICAL MANAGEMENT

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Corporate Governance

Transparent management at DSME is carried out by the Board of Directors (BOD) and the Audit

Committee, the top decision-making bodies of the company. The BOD is comprised of eight

members, with half of them being outside directors. DSME discloses audited financial statements

and information on financial performance every quarter.

Category Name Educational background and major career- Yonsei Univ.

Inside director Nam, Sang Tae - Former vice president of DSME- President & CEO of DSME- Sungkyunkwan Univ.

Inside director Kim, You Hun - Head of International Business Division of KDB- Head of Financing Division of DSME- Busan Univ.

Inside director Lee, Young Man - Managing director in charge of hull design- Vice President & CTO

Outside director - Graduate School of Dong-A Univ.Audit Committee Kim, Young - Former CEO of Busan Munwha Broadcasting Corp.member - Professor at Bukyong Univ.Outside director - Hanyang Univ.Audit Committee Jang, Deuk Sang - Executive director of Kabul Developmentmember - CEO of Himchan DevelopmentOutside director -Audit Committee Bae, Gil HoonmemberOutside director - Graduate School of Pennsylvania Univ.Audit Committee Song, Hee Joon - Dean of Dept. of Social Science at Ewha Univ.member - Professor at Ewha Univ.Outside directorAudit Committee Ahn, Se Youngmember -

DSME is implementing transparent management based on

advanced corporate governance.

- Graduate School of Pennsylvania Univ.

- CEO of Korea Delphi

- Seoul National Univ.

- Professor at Sogang Univ.

┃BOD status┃

Ethical Management

Ethical management is essential in building trust between the company and its stakeholders such as

customers, shareholders, employees, business partners, and local communities. As a leading

company in the global shipbuilding industry, DSME carries out ethical management strictly applied to

its employees both in Korea and overseas countries. As a part of these efforts, we conduct a variety

of activities that include employee education, public relations, and operation of monitoring system.

Daewoo Shipbuilding and Marine Engineering strives to provide superior products and services and pursuemutual prosperity with stakeholders with the goal of becoming a respected comprehensive heavy industriesgroup. This Code of Ethics sets forth the company's ethical standards that must be observed by allemployees.

Chapter 1 Emphasis on Customers1. We will do our best to ensure timely delivery of superior products and services that meet customers'

expectations.2. We will protect customers' interests and safety and refrain from unfair conduct against customers.3. We will humbly accept customers' complaints and suggestions and honor our promise to customers.

Chapter 2 Respect for Shareholders1. We will increase corporate value through rational investment and efficient business activities.2. We will respect shareholders' rights and reasonable demands and treat all shareholders with fairness and

equality. 3. We will comply with related laws and accounting standards when handling and reporting financial

information.

Chapter 3 Win-Win Cooperation with Partner Companies1. We will provide equal transaction opportunity to all qualified partner companies and select partner

companies based on fair standards and transparent procedures.2. All transactions will be conducted fairly from a mutually equal footing, and we will refrain from unfairly

granting special favors or causing damage under any circumstances. 3. We will cooperate with partner companies to promote mutual development and clean transactions.

Chapter 4 Contribution to National and Social Development1. We will contribute to development of society and the national economy through sound profit generation

and sustained growth, job creation, faithful payment of taxes, and social contribution.2. We will respect the traditions and cultures of local communities and strive to advance local communities.3. We will strive to protect nature, prevent pollution and conserve resources.

Chapter 5 Mutual Development of the Company and Employees1. We will respect the dignity and values of each employee and will not discriminate against employees based

on regional and academic background, gender, race, religion or physical disability.2. We will provide employees with a clean and safe working environment, encourage creative thinking, and

offer fair opportunities for growth and development. 3. We will conduct fair employee evaluations based on their ability and performance and provide reasonable

compensation.4. Employees will share the company's vision and objective and faithfully carry out their given duties. 5. Employees will abide by the company's policy and regulations and refrain from unjust activities such as

false reporting or misrepresentation that could hurt the company's interests. 6. Employees have an obligation to protect the company's tangible and intangible assets and information and

will refrain from personal use of the assets and information. 7. Employees will treat each other with mutual respect as colleagues and refrain from giving or receiving

money or favors.

DSME carries out and promotes ethical management as a world

class shipbuilding and marine company.

Code of Ethics

Code of Ethics

Audits

AuditsDSME carries out regular and specialaudits of the organization in order toincrease work efficiency and preventwork related risks. ㅡEthics ConsultingAn ethics consulting center has beenset up to provide ethical standards toguide employees in carrying out theirwork and to prevent corruption andwrongdoing.ㅡEthics Monitoring DSME identifies corruption, wrongdoingand various risk factors through ongoingmonitoring activities to expose unethicalconduct and takes steps to remove theunderlying causes. ㅡProclamation of Ethical ManagementOn January 4th, 2010, DSEM held anethical management ceremony whereits executives and employeesparticipated. At the ceremony, thecompany proclaimed its commitment toethical management.ㅡEthics LectureDSME invites outside experts to givespecial lectures in order to raiseemployees' awareness of businessethics and their commitment to ethicalmanagement.

Proclamationof Ethical

Management

EthicsLecture

EthicsConsulting

EthicsMonitoring


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QUALITY MANAGEMENTSTAKEHOLDER COMMUNICATION

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Quality Management

Quality management systemDSME operates "Total Quality Information Center" to conduct quality management in a systematic

manner. Through the system, real-time quality monitoring as well as daily collection of information

on checkups are executed. In addition, Worker Qualification Management System is contributable

to prevention of quality defects from their resources. In particular, quality management inspectors

are dispatched to each site for perfect quality management to assure the required quality level for

the companies supplying the materials.

Self-quality systemAt DSME, a three-stage autonomous quality system is established. The workers-supervisors-

quality control staff system plays a fundamental role in producing the finest quality products.

Moreover, the job owner system for quality control along with 5,200 highly skilled welders with

international certificates is conducive to producing high quality products.

Quality management promotion activitiesEvery employee at DSME is trained for individual skill and quality control twice a year. Also,

employees from subcontractors are provided with the same level of training as DSME employees.

Quality patrol activities are carried out once a week just before works begin.

┃QA/QC Status┃

NO. Name of Certificate Certification Authority Date1 ISO 9001 QMS Certificate DNV Certification '92.12.15~'10.12.152 Certificate of Welding Germanischer Lloyd '99.02.01~'10.05.313 Nuclear Power Quality Assurance Certificate Korea Electric Association '97.08.27~'11.08.194 Defense Quality System Certificate Defense Agency for Technology & Quality '00.10.25~'12.10.245 KOLAS (Korea Laboratory Accreditation Scheme) Certificate Korean Agency for Technology & Standards '00.12.09~'10.02.146 Certificate of Internationally Certified Testing Institute Korean Agency for Technology & Standards '96.12.28~'10.11.06

As of November 2009

DSME conducts quality management in a systematic manner

through operating Total Quality Information Center and Worker

Qualification Management System.

Practical Mind of Quality Philosophy·Fulfill the promise made to our

customers in advance of their request·Always bear in mind that each person

is responsible for the product andperformance quality of DSME·Strive continuously to improve the

quality of products & services·Always remember that we are

producing the world's best products atthe world's leading shipyard·Complete our assignments correctly at

first time

Quality philosophy

Self-motivation Pride

Trust withCustomers

Quality management system

1. Customer-centered Quality

ManagementSystem

2. Top QualityService

4. Zero DefectProduction

Quality Management System1. Collect customers’ requirements

and perform activities tailored tofulfill their needs, and verify that theprocess/product quality is providingtotal customer satisfaction

2. Provide after-sales services on realtime basis with e-A/S net

3. Foster the best quality specialistsby division and maximize theefficiency of our facilities

4. Enhance monitoring pilot techno-logy by production process stage

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ISO 9001KOLAS

3. Optimizationof Resources

Stakeholder Communication

Enhancing value for customers, employees, shareholders, partner firms and local communities is

the ultimate goal pursued by DSME. Accordingly, we actively communicate with stakeholders to

receive and incorporate their views in our business activities.

Enhancing stakeholder value is the ultimate goal pursued by

DSME.

Communication channel

Shareholders' meeting, IR, Conference•e-Mail/phone consultation, disclosure, etc.•

Shareholder

LocalCommunity Customer

BusinessPartner

Employee

•HSE Forum, IHWT (Integrated HSEWorkshop Team) meeting

•Customer newsletter

•Call center

•Ship A/S websiteSocial volunteer group•

Meeting with partner firm representatives•Seminar for partner firm CEOs•

Global Top Cooperation•Workshop for partners, etc.

•Management Consultative Committee,Labor-Management Committee

•Portal Community (Open Space)

•Ethical counseling center

Shareholders' meeting (1 time), IR and Non-Deal Roadshow (5 times), Participation in Shareholder conferences in Korea and overseas countries (7 times), Meeting with domestic institutional

investors (296 times), Annual Report and Factbook, conference calls, etc.Handling customer complaints, Operation of ship after service website

Customer (http://as.dsme.co.kr/jsp/intro.jsp), HSE workshop (12 times), HSE Plaza, Publication Okpo Gazette

EmployeeManagement Consultative Committee, Labor-Management Committee, Industrial Safety and Health Committee, Operation of ethical counseling center, Cyber hotline, etc.Industrial Safety and Health Committee of partners, Pep rally for partner firms and ship

Business owners, Green partnership, Labor-management walk together event, Operated academy forPartner housewives of employees at partner companies, Held conference and seminar for partners,

Established cooperation system for partnersLocal

Operation of Geoje College, Supporting cultural programs, etc.Community

Major activities in 2009

Client HSE Forum

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ECONOMIC PERFORMANCE

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Economic Performance

2009 2008

Ⅰ. Current assets 9,019,958 9,382,402 Ⅱ. Non-current assets 6,116,400 6,571,152

Total assets 15,136,358 15,953,554 Ⅰ. Current liabilities 9,392,880 9,866,698 Ⅱ. Non-current liabilities 2,485,899 4,018,989

Total liabilities 11,878,779 13,885,687 Ⅰ. Paid-in capital 961,954 961,954 Ⅱ. Capital surplus 200 200 Ⅲ. Capital adjustments (31,643) (30,843) Ⅳ. Accumulated other comprehensive income 865,684 20,328 Ⅴ. Retained earnings 1,461,384 1,116,228

Total shareholders' equity 3,257,579 2,067,867 Total liabilities and shareholders' equity 15,136,358 15,953,554

┃Summary balance sheet┃(unit: KRW million)

2009 2008I. Sales 12,442,519 11,074,644 II. Cost of sales 11,463,815 9,749,867 Ⅲ. Gross profit 978,704 1,324,777 Ⅳ. SG&A expenses (294,181) (293,226)Ⅴ. Operating income 684,523 1,031,551 Ⅵ. Non-operating income 1,877,344 1,859,230 Ⅶ. Non-operating expenses 1,793,814 2,311,096 Ⅷ. Income before income taxes 768,053 579,685 Ⅸ. Income taxes 190,549 177,957 Ⅹ. Net income 577,504 401,728

┃Summary income statement┃(unit: KRW million)

DSME recorded its best ever financial performances for two

consecutive years.

┃Summary financial statements┃

16,000

12,000

8,000

4,000

0

2007

8,28

7

2008

15,9

54

2009

15,1

36

Total assets(unit: KRW billion)

600

450

300

150

0

2007

2008

402

2009

578

Net income(unit: KRW billion)

322

2009 2008Current ratio 96.03% 95.09%Debt-to-equity ratio 364.65% 671.50%Total borrowings to total assets 13.88% 1.87%Interest expenses to operating income 1,038.81% 7,041.07%

┃Stability┃

┃Key financial ratios┃

2009 2008Operating income margin 5.50% 9.31%Net income margin 4.64% 3.63%ROA 3.72% 3.31%ROE 21.69% 20.93%

┃Profitability┃

2009 2008Sales growth 12.35% 55.88%Operating income growth -33.64% 236.25%Net income growth 43.75% 24.68%Total assets growth -5.12% 92.51%

┃Growth┃

100

50

0

2007

95.4

4

2008

95.0

9

2009

96.0

3

Current ratio(unit : %)

60

30

0

2007

31.5

5

2008

55.8

8

2009

Sales growth(unit : %)

12.3

5

16

17


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VISION AND STRATEGY

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Vision and Strategy

DSME does its utmost to generate annual sales of KRW20 trillion

by 2015 and transform into a comprehensive heavy industry group.

┃Vision┃

DSME does its utmost to grow into the world's No.1 shipbuilding, marine engineering and general

company, by achieving sales of KRW20 trillion in 2015 through innovative leadership based on

"trust" and "passion." In a bid to achieve the company vision, we established F1 strategy.

No.1 Shipbuilder Sales of 12 trillion won

•Maximization of Okposhipyard compatibillity•Be the first mover in Chinese

shipbuilding market

No.1 Floater Supplier Sales of 3~4 trillion won

•Standardization of FPSO•Vertical integration of

engineering field•Entry into local markets•Entry into new business area

New business in alliedindustries

Sales of 4~5 trillion won

•M&A•Stepping stone-way

development based on coreabilities

Global network operatingcompetency

DSME's unique way forpervasive innovation

Innovative leadership based on"Trust and Passion"

•Entry into China (Completed)

•Establishment of new offshore plantmodel

•Development of new business

•Development of pervasive innovationmodel (Completed)

•PSM (Procurement & SupplierManagement) innovation

•Optimization of Product mix inshipbuilding area (Completed)

•Risk management (Completed)

•PI (Process Innovation)

8 Strategic Objectives forVision Achievement

DSME's future after vision achievement

SHIPBUILDING

OtherGlobal

Network

China

Okpo

OFFSHORE PLANT NEW BUSINESS

SHIPBUILDING OFFSHORE PLANT NEW BUSINESS AREA

•Concentration on LNG carriers•Specialty ships•Development of high added-

value ships

•New shipyard•Construction of blocks and

other components•Supplier network•Repair od older ships

•DMHI (Rumania)•Local market (N. and S.

America)•Shipyard for repair &

refurbishing (Middle Asia,Southeast Asia)

•Overall solution for FPSO

•Standading of FPSO•Vertical integration of

engineering•Entry into local markets•Entry into new business

•Vertical imtegration

•Energy and logistics industries•Vertical integration•Ship lease /

Financing business

The World's No.1 Shipbuilding, MarineEngineering and General Company

2010 - 2012 2013 - 2015 2020 vision

Period for jumping toward theglobal best

·Establishing foundation for jump-up ·Making inroads into new

businesses (modular plant, F-LNG,wind power business, etc.)·Establishing corporate culture of

passion and autonomy

Period for entering into top-tierlevel by business

·Global top in the shipbuilding andoffshore industry·Entering into top class in plant and

new & renewable energy·Optimizing business portfolio

Becoming world leading heavyindustries group

·World's top position by business(shipbuilding, offshore, plant, newand renewable energy) ·Developing new growth engine

continuously

F1 strategy

Management policy in 2010

•Secure experts

•Stabilize new business earlier

•Complete future business structure

Developingfuture growth

engines

Enhancingcompetiti-

veness

Breaking out shell

•Nurture creative andchallenging talents

•Continue systematicinnovation activities

•Stabilize labor-management relations

•Establish fun-filled worksite

Receive orders as early as •possible

Secure liquidity•Reduce total costs by 10%•

(OK Movement)

Develop market-leading•products

18

19


+

NEW GROWTH ENGINE FOR SUSTAINABLE GROWTH

+

New Growth Engine for Sustainable Growth

DSME is focusing on discovering new growth opportunities such

as wind power business and green business.

Wind Power Business

DSME has acquired shares of DeWind Inc., a subsidiary of U.S.-

based CTC (Composite Technology Corp.). Following its

acquisition of DeWind for $50 million, the company plans to

make an investment of $70 million to develop a new model.

Furthermore, DSME will build a production plant in North

America. The company's blue print of the new business calls for

creating a wind power station with 20 units of 2 megawatt

turbines in Texas in the short term and expanding it into a huge

wind power station composed of 420 turbines. Starting from

North America, the company plans to become the tenth largest

company by 2015 and third by 2020 through securing 15 percent

of the global market by 2020.

E&P Project

DSME entered various E&P (Exploration & Production) fields by

partly acquiring shares of Zambyl mining lot in Kazakhstan,

participating in Indonesian oil field CEPU project and producing

crude oil, establishing a Singaporean crude oil trading subsidiary,

and taking over the biggest gold mine in Korea (representing

93% of total production). Especially, starting from this year,

DSME will participate in hydrothermal sulfide minerals (area:

20,000㎦, about 10 times the size of Jeju Island) exploration work

in Tonga, in the South Pacific, together with Korean government

and other domestic companies and will start commercial

development after 2012 once evaluation of reserves and

economical efficiency is determined.

Business Opportunity in Russia

DSME signed a memorandum of agreement (MOA) with Russia's

United Shipbuilding Corporation (USC), and currently participates

in construction of Zvezda Shipyard in Vladivostok. With the

agreement, DSME and USC will jointly participate in shipbuilding

and offshore plant construction along with oil & gas exploration

and production projects.

Oman Project

After signing MOU contract with Oman government for building a

new city in Oman, DSME is pushing ahead the plan to build a

residential complex as its first project. The detailed projects for

building a new city consist of building ship repair yards, petro-

chemical facilities, harbors, airports, power plants and these

projects are in progress. The establishment of tourist, residential

and industrial complex is scheduled to follow.

Environment-Friendly Project

DSME signed the contract with Sargas AS of Norway for power

plant facility technology development without discharging carbon

dioxide, and agreed to proceed to the basic design for thermal

power plant facilities, product commercialization and marketing.

Through the cooperation, DSME plans to develop floating or

modulized thermal power plant facilities.

Development of New Products and Technologies

Next Generation Ship and Marine Structure DSME

aims to complete LNG-FPSO (Floating Production Storage and

Offloading) within the first half of 2010. It is a new concept marine

plant with various functions including production, liquefaction,

storage and loading of natural gas. In terms of time and cost, it is

very effective compared to existing methods which produce

natural gas in the sea, liquefy and store natural gas on the land

before loading it on LNG ships. Furthermore, DSME will complete

development of LNG-FSRU (Floating Storage & Regasification

Unit) by 2010, which is a floating offshore LNG terminal. DSME

has the most patents in this field, and we have signed a research

and development contract for conceptual designs of LNG FSRU

with BOE, a subsidiary of Exxon Mobil in March 2010.

High Value-Added Ships In December 2009, DSME

completed technology development of high value-added ships

such as oil tankers for polar region sailing and drill ships, and the

technological marketing for ship owners is ongoing. In December

2009, we established the whole process of manufacturing cruise

ships from designing to building according to strategies by

stages since 2008. We are realizing high value-added ship

business in full scale by obtaining order for two large car ferries in

June 2009.

Localization of LNG Ship Cargo Storage The

development of LNG ship local cargo storage will be completed

by December 2010 as a part of the national project supported by

Korean government. It is the representative localized technology

for equipment and materials. If the technology can be verified at

early stage, we can reduce the huge amount of royalty paid to

GTT of France which has an exclusive patent in cargo storage

technology. Furthermore, our competitiveness in the LNG ship

market is expected to be strengthened.

Building...Planet full of vitality

We think of a planet full of vitality. We hope for a world where everything is

vividly alive. DSME does not limit itself to building ships. Green shipbuilding

is our promise to create such a planet. This sector holds DSME’s efforts to

leave a clean environment to our next generation.

Environmental Performance Environmental Management 22

Activities and Performance 28


+

ENVIRONMENTAL MANAGEMENT

+

22

23

Environmental Management

DSME is moving towards its vision of becoming an 'eco-friendly

shipbuilder' by building an advanced environmental manage-

ment system.

┃Environment policy┃

We have established an environmental policy to guide us in our ongoing efforts to help protect

natural surroundings and minimize pollution. It enables us to enhance productivity and secure a

healthy and convenient environment.

┃Goals and strategy┃

DSME is moving towards its vision of becoming an 'eco-friendly shipbuilder' by building an advanced

environmental management system. As a part of these efforts, we have established a master plan by

phase since 1991 and carried out relevant activities. Under the targets of becoming a global

environment-friendly leader by 2014, we have mapped out plans that focus on a response to climate

change, design and building of eco-friendly ships, and establishment of a resource recycling system.

Adhere to environmental regulations and minimizedischarge of pollutants•Continue to develop environmental technology to

reduce consumption of raw materials and energy

Encourage employees to follow 'green principles'•Educate employees on environmental principles

and encourage them to adopt 'green' practices

Take precautions against environmental accidents•Maximize efficiency of environmental management

by curbing and checking the creation of pollutantsin all operation processes

Continue the 3R movement•Help protect the environment by following the 3R

practices of Reduce, Reuse and Recycle

Disclose environment information•Regularly disclose environment information to

ensure transparency of environment policyimplementation

Environment policy

Phase 1_Adoption of anenvironmental managementculture•Establishment of an environmental

team•Declaration to become an 'eco-friendly

shipbuilder'•Acquisition of ISO 14001 certification•Declaration of environmental

management•Establishment of the DSME

Environment Award•Elimination of environmental accidents•Adherence to environmental

regulations and expandingenvironment-related investments

Phase 2_Optimization of environmental management•Minimizing pollutant discharge·Increasing reuse of gray-water·Decreasing volume of waste paints

and wastes generated·Decreasing dust·Decreasing volume of toxic material

used•Expanding waste recycling·Increase in separate collection·Improvement of waste disposal

method·Recycling residual materials·Environmentally friendly design and

purchasing activities

Phase 3_Realization of anenvironment-friendly DSME•Open environmental facilities•Increase the number of projects

which support local residents /environmental groups•Form local 'green' areas

Phase 4_Becoming a global environment friendly leader •Execution of climate change response strategy·Reducing greenhouse gas emissions·Establishing new and renewable energy business•Design and building of eco-friendly ships•Establishment of advanced resource recycling system

1991~2006

2006~2009

2009~2011

2011~2015

Environmental goals and action plans

┃Environment management system┃

DSME has established an environmental management system (ISO 14001) for continued

improvement of our environmental performance. In order to carry out our environment policy, we

set up company-wide goals and particular targets for each team. In addition, our environment

management system is evaluated on a quarterly basis by an internal HSE (Health, Safety, and

Environment) review and the results are reported to the head of each business site to improve the

system.

┃Environmental organization┃

The HSE Improvement Committee deliberates on environmental issues both in Korea and

overseas countries in addition to matters on environment improvement and reports to top

management. The committee sets environmental targets and is responsible for conducting

reviews and making decisions on matters pertaining to the environment, safety and health. The

Environment group draws up action plans and oversees execution of the plans across all of our

operations. The team deploys personnel to each of our business sites with the mandate to help

prevent environmental accidents and ensure eco-friendly work processes, thus building a green

worksite.

Environmental organization

HSE Operation Team

EnvironmentalManagement Group

GeneralManager ofShipyard

•Review company-wideenviromental policy andmeasures·Eastblish company-wide

enviromental goals andplans for preventivemeasures·Manage environmental

performance index•Review and study

environmental effects•Enviromental PR/Training &

Evaluation•Check/improve onsite

enviromental incongruties•Environment-related civic

appeals/authorities/NGOs•UNFCCC·Establish GHG inventory·Develop reduction program

•Authorize air/waterenvironmental facilities/newinvestments/review/improvement/pollution measurementresults management•Operate wastewater/sewage

water treatment facilities•Authorize marine enviroment

facilities/improve/resultsmanagement•Operate 'eco-friendly vessels'

(marine pollution preventionand production support)•Manage toxic/soil pollution

causing facilities/review/improve/results management

•Establish and execute wastetreatment plan•Waste disposal/account

settlement/resultsmanagement•Waste collection and facility

management•3R promotion·Reduce·Reuse·Recycle•Conduct and evaluate waste

separation•Operate waste material

recycling center

Environmental Management Air/Water/Marine Management Waste Resource Management


+


+

24

25

┃Operational system chart┃

Report ofincongruities

Discovery of failure/preventive measures

Filing/reporting

Confirmation inquiry

Establishamendment plan

Report-ing

Notify inquiry

Notify inquiry results

Follow-upmanagement

① Report form for safety, environmental incongruities

② Safety and environment information filing and ledger

③ HSE Improvement form

④ Daily HSE information

⑤ Results notification

*Safety environment information treatment process (DSM-S-308)

①

②

③④

④⑤

1. Apply 5W1H, file and report

•Safety accidents/incidents•Environmental pollution incidents (air, water, waste,

soil, marine pollution, etc.)•Safety, health and environment regulation violations

2. Manage records of phone, written notifications

3. Distinguish relevance of filed information

4. Establish/report correction plans (consider

eliminating actual/potential failure incongruities)

•Urgency•Efficiency of process

•Regulations•Interest level of related persons•Other internal/external factors

5. Notify results of action taken immediately or after

planning

6. Monitor progress of amendment measures, report

and confirm completion

7. File entry into safety, environment information

ledger

Management points

┃Environmental monitoring ┃

To effectively respond to various environmental accidents, DSME has a response system which is

shown below in the operational system chart. Reported incidents are treated with an accurate and

efficient 7-step process. This enables us to deal with the situation in the most appropriate manner

for maximum efficiency. In the case of a minor accident, steps are taken immediately at the site.

An improvement request form is then filed for future reference. When a more serious incident

occurs, the incident is reported directly to the head of shipyard. This is then followed up by joint

efforts to contain the incident.

Report of results

Correction /Improvement

Regular/ordinary monitoring

Confirm inquiry results

HSE OperationTeam

Company-wide Improvement, Safety environment Management Related standards and formsexecution division management division representive

Category Amount Cost category Sub-category Amount Details Amount

┃Breakdown of environmental costs┃

┃Environmental accounting┃

DSME has established an environmental management system (ISO 14001) for continued

improvement of our environmental performance. In order to carry out our environment policy, we

set up company-wide goals and particular target by each team. In addition, our environment

management system is evaluated on a quarterly basis by an internal HSE (Health, Safety, and

Environment) review and the results are reported to the head of each business site to improve the

system.

1. Environment management system activity costs (auditor/personnel costs of support team) 481,935

2. Education costs (internal/external training related to environment) 176,515

3. Energy/resources saving costs (reduction/recycling costs) 8,100

4. R&D activity costs (manufacturing/product improvement costs) 0

5. Global environment conservation costs (greenhouse effect/ozone depletion, etc.) 0

6. Worksite ‘greening’ costs 890,000

1. Environment improving investments 17,538,000

2. Prevention facilities operation costs (depreciation/repairs and maintenance/

renovations/personnel/electricity costs)4,986,854

3. Pollutant discharge measurement costs (in-house/ commissioned/ automatic measurements) 399,360

4. Pollutant discharge cleanup costs (disposal/management costs to commissioned firm) 6,544,144

1. Pollution prevention/restoration costs 68,400

2. Environment taxes 24,681

3. Fines and penalties 1,764

1. Environmental report/Annual report publishing costs 55,000

2. Social contribution activity costs

•Stakeholder cooperation costs

•Environment conservation costs (charity/environment volunteer work) 919,961

•Regional cooperation costs

3. Social forestation costs 0

1. Reduced costs due to preventive activities

•Reduced costs from less waste paint553,792

•Reduced water costs from reusing heavy water

2. Benefits from recycling

•Scrap iron/metal/wasteship/slug/recycled resin/wastepaper sales3,696,325

※excluding sales from scrap iron

Environmentalcosts(cost

reductionsminus

expenditures)

Environmentalexpenditures

32,094,714

Cost reduction

4,250,117

Pollutionprevention

costs

Pollutioncleanup costs

Social costs

Costreductions

due toenvironmental

activities

-27,844,597

(unit: KRW thousand)

(unit: KRW thousand/year)Environmental investment

Wastemanagement

MarineenvironmentWater qualityAir quality

60,0001,762,00079,00015,637,000

1) Construction/improvement of

painting plants

2) Construction/improvement of

pre-processing plants

15,607,000

3) Purchasing electric sprays

30,000

1) Improvement of sewage

water treatment facility

79,000

1) New waste material

recycling center

1,525,000

2) Recycling bins

237,000

1) Improving engine function of

environmental vessels

60,000

Environment risk

managementcosts

1,556,550

29,468,358

94,845

974,961

4,250,117


+


+

26

27

┃Environmental performance┃

We have analyzed the components of the environmental indicators set forth under the GRI Guidelines and

ISO 14001 and selected indicators that are appropriate for DSME from 2006. For each indicator we

employ, we have set the standards for measurement and weightings in order to quantify our environmental

performance. Each worksite has in place an evaluation system that is best suited for the setting.

EnvironmentalManagement Index (100)

ManagementPerformance Index

(MPI) (50)

OperationalPerformance Index

(OPI) (40)

EnvironmentalPerformance Index

EPI (10)

Environmentalstandard conformity

index (5)

Environmentalaccounting index (5)

Environmentalactivities index (15)

Stakeholder index (5)

Waste dischargeindex (15)

Air/water pollutantemission index (15)

Water quality index (3)

Soil quality index (3)

Hazardous substanceutilization index (4)

PerformanceSub-category Evaluation item Standard

index

┃Environmental performance index guideline┃

1. Suitability of EMS plan 3.0 3.0 2.5 2.42. Execution rate/schedule 6.0 6.0 5.5 6.03. Satisfactory level of execution 6.0 7.2 5.0 6.04. Regular management 5.0 7.0 6.0 5.01. Regulation violations 3.0 3.6 4.2 4.82. Fines 2.0 2.4 2.8 3.21. Environmental expenditures 3.0 1.5 0.0 2.02. Environmental benefits 2.0 0.8 0.0 0.01. Requests to improve environmental

incongruities 10.0 20.0 20.0 18.02. Environmental cleanup activities 5.0 5.0 3.0 4.01. Information sharing with residents

(onsite visitors) 1.5 2.7 2.4 1.22. Frequency of contact with stakeholders

(environment-related) 1.5 2.5 1.9 3.1

3. Environment-related civic appeals 2.0 2.0 1.2 2.01. Major raw ·Steel 1.5 2.4 2.4 2.7

material use ·Paint 1.5 0.6 2.4 2.42. Water use 1.5 1.8 2.7 2.73. Energy use 1.5 2.1 2.7 3.01. Hazardous chemical use 4.0 0.0 8.0 8.01. Waste generation volume (basic unit) 4.0 8.0 8.0 8.02. Waste recycling rate 4.0 6.4 6.4 5.63. Wastewater recycling rate 4.0 8.0 8.0 0.04. Waste separation efficacy rate 3.0 4.2 4.8 5.41. Emission of air ·Total dust emission 3.0 0.6 1.8 4.2

pollutants ·Total SOx emission 3.0 5.4 5.4 4.22. Emission of ·COD 3.0 0.0 0.0 0.0

water pollutants·BOD 3.0 1.8 0.0 0.0·SS 3.0 6.0 0.0 1.8

1. Analysis of air ·PM10 1.5 1.2 1.5 1.8quality around ·SOx 1.0 2.0 2.0 1.8company ·Ozone 1.5 0.3 1.8 0.0

1. Analysis of ·COD 1.5 3.0 0.0 2.7water quality ·DO 1.5 1.8 0.6 0.9around company

1. Results of ·BTEX 1.5 1.5 3.0 3.0company soil ·TPH 1.5 0.0 0.0 0.0quality

Total 100 120.8 116.0 115.9

Environmentalmanagement systemoperation index (20)

Resourceutilization index (6)

Air quality index (4)

2007Evaluation

index

2008Evaluation

index

2009Evaluation

index

┃Environmental education ┃

1) Classroom education about the environment the new recruits

DSME offers classroom education on the environment to new employees working in offices and

production lines as well as subcontractors in order to realize an environment-friendly workplace.

Based on domestic and international environment trends, inappropriate environmental cases and

internal environmental standards, participants receive education regarding work instructions,

installation of environmental facilities and 3R (Reduce, Reuse, Recycle). Meanwhile, DSME

continuously educates its staff about environment through environment information magazines

and weekly education materials, thus enhancing employees' understanding on environment

management in general and establishing an environment-friendly workplace.

2) Environment common sense note

On our website, we have posted environment common sense and stories on prevention of

pollution incidents inside the worksites.

3) Improving monthly environmental campaign broadcast

We compose broadcasting announcement with 'green start song' that is related to our monthly

environmental subject to incite employees' interests in environmental matters. Employees at

DSME join the broadcasting.

┃Environment database ┃

In order to integrate and enhance the environment-related works, DSME has built and operated a

database which is linked to various facilities for wastewater treatment, air pollution prevention and

waste management. It enables real time monitoring, statistics compilation and analysis.Environmental newsletter

Environment database

Environmentdatabase

Environmental education for newly hired employees

Airpollution

Toxic substance

Sewage water

Waste

Wastewater

Soil contami-nation

Achieving GHG reductiontarget and introducingverification system ·Achieving mandatory

reduction (Selecting energysaving/efficiency maximi-zation tasks by process)·Pursuing climate change

related CDM business(securing emissions right)·Study on climate change

related business such asCDM ·Participation in the

emission trading scheme

Setting up GHGreduction program andtarget ·Building GHG inventory ·Developing GHG

management system(management byworksite and process)·Establishing GHG

reduction tasks

Establishing basefor management of

GHG emissions

Reducing GHG emissions /Conducting tasksto respond to theclimate change

convention

Respondingto the mandatoryreduction period


+

ACTIVITIES AND PERFORMANCE

+

28

29

Activities and Performance

DSME takes initiatives in preserving the earth through its all-out

efforts to reduce environmental impacts, and waste manage-

ment and recycling.

┃Response to climate change ┃

Establishing a three-phase master plan in preparation for the United Nations Framework

Convention on Climate Change (UNFCCC), DSME carries out relevant activities to cope with

global warming, which is one of the most important issues facing the world.

┃GHG inventory establishment and verification ┃

DSME calculated GHG emissions based on ISO14064, the IPCC Guideline, and the WRI GHG

Protocol. Through the verification by the third party, it enhanced the credibility of the results.

Master plan for responding to UNFCCC

Boundaries Okpo shipyard at DSME (excluding Seoul office and subsidiaries) Period Year of 2008 and 2009

GHG categorySix greenhouse gases defined by the Kyoto Protocol (CO2, CH4, N2O, HFCs, PFCs, SF6)

Verification KSA (Korean Standards Association)

institution

┃GHG inventory establishment and verification┃

Establishing base formanagement of GHGemissions ·Organizing response

team in the shipbuildingindustry ·Promoting for enhancing

awareness ·Calculating GHG gas

emissions (generaldocument form)

Phase I (2009) Phase II (2010~2012) Phase III (2013~)

GHG inventory establishment certification

GHG inventorycalculation report

┃Cases on climate change countermeasure ┃

DSME premiered its first hybrid vessel, No. 2258, in June 2009, the vessel drastically

reduces emissions of toxic gases. The 2258 (BS GAS 162,400 m³) is an electric hybrid vessel

that gains its power not from the main engine but from a motor. Electrically-propelled ships

which match with the environment-friendly trend came to the world shipbuilding market.

This vessel is different from other LNG ships in many aspects. First of all, two motors are the

main sources of power while the dual fuel engine that uses both oil and gas discharged from

the LNG cargo is built on the generator that produces electricity for the motor. Therefore, this

ship can greatly increase economic efficiency and minimize discharge of harmful gas.

Furthermore, two propellers have excellent propulsive and control performance. In 1998, DSME

started research on electricity-propelled ships. In 2005, we successfully received the first order

from Norwegian ship owners who have strict environmental standard. Currently, we are building

ten ships.

Environment-friendly hybrid vessel

Amidst the stricter international regulations on pollutant emissions from ships, we have

initiated the development of a groundbreaking environmentally friendly vessel

propelling system. The vessel propelling system under development with MAN Diesel, a

Danish engine manufacturing company, consists of a ME-GI (gas injection method)

engine and high-pressure gas supply system.

This engine greately reduce environmental impacts by getting its drive through the use of

high-pressure natural gas in addition to the diesel that common vessels use. The engine

reduces emissions of carbon dioxide (CO2), nitrogen oxide (NOx), and sulfur oxide (SOx)

by 23%, 13%, and 92%, respectively in comparison with other diesel engines with the

same power capacity. Also, when applying this propelling system to a 14,000TEU

container vessel, it reduces approximately US$ 12 million/yr of fuel cost.

Moreover, we hold ten patents regarding the high-pressure gas supply system and its influence

will continue to grow because this system is applicable not only to the shipping industry but also

other industries.

Environmentally friendly vessel propelling system

2009 2008GHG emission volume 426,000tonCO2eq/yr 365,000tonCO2eq/yr

┃GHG emission volume┃

Stationary combustion

Mobile combustion

Process

Leak

Electricity purchased

(unit : %)

In 2008

6.25.4

43.1

53.247.2

35.6

3.7 4.4

In 2009

0.60.6


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+

30

31

Dust collector of newly built GPS pre-process plant

┃Air quality ┃

DSME provides a clean and pleasant environment to the residents around the worksites as well as

workers in the worksite. We have monitored and analyzed the environmental changes and

prepared for proper plans to quickly respond to the potential environmental impacts around the

worksites since 2005. According to the measurement results of air quality in 2009, all items

including PM10, CO, and SOx satisfied the legal requirements.

DSME Anjeong National

DSME OkpoDSME Okpo

ShipyardShipyard Industrial

ComplexNumber of outlets 92 14

Filtering dust collectors

Bag Filter 60 14

Absorbers A/C Tower 6Absorbers Scrubber 6

Pollution Centrifugal power Cyclone 4prevention Weight Preduster 5facilities Oxidation RTO 2

Other boiler related environmental 9

facilitiesTotal 92

┃Outlet status┃

100

75

50

25

0

Lega

lst

anda

rd10

0

PM

1036

0.12

0.09

0.06

0.03

0

Lega

lst

anda

rd0.

06

NO

x0.

014

0.12

0.09

0.06

0.03

0

Lega

lst

anda

rd0.

06

O3

0.03

2

10

8

6

4

2

0

Lega

lst

anda

rd9

CO

1.07

0.12

0.09

0.06

0.03

0

Lega

lst

anda

rd0.

05

SO

x0.

006

Air quality around the worksites

(unit: ㎎/㎥) (unit: ppm)

(unit: ppm) (unit: ppm)

(unit: ppm)

Voluntary Agreement on VOC reduction

Application of environment-friendly paints

Emission of VOCs in 2009 was 4,935 tons/year, a 35.5% decrease from 2006.

Overview Agreement between government and 9 shipbuilding companies (Nov. 2007)

Content VOC (Volatile Organic Compound) reduction of 30% compared to that of 2006

until 2011 (DSME 30.3%)

Total investment KRW 62.6 billion (9 shipbuilding companies: KRW 360.5 billion)for 5 years

Major execution items Installment of high-efficiency dust collecting devices on pre-process plants

(completed in 2008)

Conversion of painting site to indoors: Installment of large painting shelters

(6 shelters in 5 years)

Development of silicon paint and soluble paint

Reduction of paint use by reducing waste paint

Improvement of painting skills by developing painting equipment

Application of environment-friendly paints

We seek to reduce lead time, decrease amount of paint, and build a safe working

Background environment by standardizing the use of water-soluble paint and applying it to theengine rooms and deckhouses of all vessels.

ApplicationWe have applied the new paint co-developed by DSME and IPK to the engine roomand residence areas of No. 1187 (Korea Lines 180,000DWT bulk carrier).

·We have contributed to the safety and health of workers and ship-owners by applyingwater-soluble paint which is free from toxic gas and potential explosion risk to theengine room and residence areas where people are most active during constructionand sailing.

Effect·We increase productivity by eliminating the need for primers (basic painting) when

applying the new paint.

·It will reduce dust (powder coated) during coating process compared to other existingpaints.

·Reflecting the painting in the contracts for new vessels

Future plans ·Applying the standard to all vessels

·Solving painting problems for improvement

8,0006,0004,0002,000

0

2006 2007 2008 2009 2010 2011

7,65

6

7,65

6

6,22

7

7,48

8

6,02

2

5,38

5

5,79

7

4,93

5

5,58

5

5,33

4

Reduction plan(unit: ton/year)

Plan

VOC emission


+


+

32

33

┃Water quality ┃

Sewage water treatment

Sewage water of the company is collected at the sewage water treatment facility. 17% of sewage

water is reused as graywater. Sewage water totaled 1,085,943 tons and 181,779 tons were reused

in 2009.

•Activities to improve sewage water In 2009, DSME put microorganisms into the water collector for waste water treatment to improve

the water quality. By removing stuck oil, fats and bad smell, it could increase water concentration

efficiency while improving the ventilators.

1,200

900

600

300

0

2007

977

261

2008

1,19

7

2009

1,08

6

Sewage water treatment status(unit: 1,000 tons)

Sewage water treatment system

Sewage watertreatment facillity

•Procedure of graywater reuse

Toilet Canteen Showers

Filter Dischargesump

Reuse Discharge17% 83%

Pumping Pit

Reaction tank Micro filter Filtersd watertransfer tube

Reusedwater tank

Used inballastingand waterpressure

test

▶ ▶ ▶ ▶

Facility for microorganisms Improvement of ventilations

277

182

Volume of sewage water treatment

Reused volume

Discharge

Wastewater treatment

Wastewater generated from the shipbuilding process is discharged after being treated through

physical and chemical treatment methods at the heavy machinery facility and the laundry facility. In

2009, the amount of wastewater generated totaled 20,289 tons, 20% lower than that in the

previous year.

40

30

20

10

0

2007

39.7

2008

25.3

2009

20.3

Wastewater treatment status(unit: 1,000 tons)

Flow chart of wastewater treatment

Flowadjustment

sump

▶ ▶ ▶ ▶

Neutralization,reaction,

integration,condensation

Depositionfacillity

Filtrationsump

Filtration tank

•Improving wastewater treatmentWe improved the quality of discharged water by adding chemicals like n-H decomposers and

activated carbon power into the laundry wastewater treatment facilities. Moreover, we reduced

wastewater discharge from 67 tons/ day to 47 tons/day by replacing old laundry machines.

Old laundry machine New laundry machine

Water inflow

20

15

10

5

0

BO

D20

5.8

5.6

20SS

Water quality (density)(unit: ppm)

▶Sewage water treatmentfacility

100

75

50

25

0

CO

D90

25.5

12.7

80SS

▶Heavy machinerywastewater treatmentfacility

100

75

50

25

0

CO

D90

18.2

9.2

80SS

▶Laundry wastewatertreatment facility

Legal standard

DSME


+


+

34

35

┃Marine environment ┃

Performance

•Holding campaigns to prevent marine pollutionIn 2009, DSME held campaigns to prevent marine pollution for

ships that enter and exit from the port. Through this campaign,

DSME promoted its Marine Environmental Management

Standards and the measures against marine pollution.

Furthermore, we made and distributed stickers which

contained information on the telephone number and reporting

instructions so that people can urgently report and take

necessary measures against marine pollution.

•Education on marine preservation In 2009, we conducted learning courses on Marine Pollution Prevention

Law and marine pollution cases for internal tugboat captains and chief

engineers, and pasted 'DSME Marine Environment Compliance Obligations'

on ships.

┃Waste management ┃

Marine pollution prevention campaign

Work checklist

180

135

90

40

0

2007

136

2008

161

2009

170

Management status(unit: thousand tons)

▶Total waste generated

140

105

70

35

0

2007

99

2008

121

2009

129

▶Recycling volume

12

9

6

3

0

2007

6.4

2008

7.6

2009

1.5

▶In-house treatment

40

30

20

10

0

2007

31

2008

34

2009

39

▶Consignment of wastetreatment

Total marine waste volume(unit: ton)

160

120

80

40

0

2008

133

2009

112

Recycling of waste materials

In order to promote the in-house recycling of waste materials in an effective way, we operate

waste material recycling center. First of all, we prevent the disuse of recyclable materials through

evaluation of separate collection while sorting scrap iron for reuse. In addition, we put recycling

bins around working areas to promote employees' participation in recycling. We saved KRW430

million through recycling of waste materials in 2009.

Waste reduction activities

In 2006, DSME established the DSME Environmental Award and rewarded the organization with

excellent achievements of waste reduction during the production process. In 2009, with participation

of leading organizations, DSME carried out activities focusing on waste reduction before waste

generation, and saved KRW14.7 billion. In acknowledgement of these achievements, DSME was

awarded Ministry of Environment Award for the Leading Resource Recycling Company in 2009.

Ministry of EnvironmentAward for the LeadingResource RecyclingCompany

Work process of waste material recycling center

Recycling of waste materials

•Existing process

Collect scrap iron Move to scrap ironstorage place

Gather scrap iron Sell scrap iron

Scrap ironrecyclingprocess

▶ ▶ ▶

•Additioal process

Sort abandonedscraps

Recycle Move to waste materialrecycling center

Reuse at thefield

Sort scrapirons (70%)

▶ ▶ ▶

Find wastesnot cared

Collect Move to waste materialrecycling center

Collect wastesnot cared

(30%)

▶ ▶

▲

Major management items

·Optimization ofsteel yield ·Recycle of surplus

products ·Minimization of

malfunctioneddesign·Environment-

friendly design

Design

·Raw materialmanagement ·Management of

packaging material ·Packaging unit

management ·Supply

management ofmaterial

Purchasing/Materials

·Guidance forquality improvement

Quality

·Equipment TPM ·Purchasing highly

efficientequipment·Application of

adequateconstructionmethod

FactoryManagement

·Improvement ofconstructionmethod ·Reduction of

rework ·Material recycling

activities

Production


+


+

36

37

┃Management of hazardous chemicals ┃

When purchasing chemical products, by checking MSDS (Material Safety Data Sheet), DSME

investigates the products which can replace the products including hazardous chemicals and

recommends using them. Furthermore, in production line, DSME periodically performs safety

education and training for workers dealing with hazardous chemicals, and checks regularly the

leak detector, block device and protection equipment in order to prevent leakage in advance.

┃Resources Down 20% campaign ┃

DSME promotes actively the campaign to reduce wasting resources in production lines. Moreover,

DSME is disseminating the resource reduction campaign to the whole company by adjusting the

room temperature to 28°C in office and management organizations.

Vehicle and oil

Since 'Resources Down 20% Campaign' was started in September 2009, the total number of

company vehicles decreased from 267 to 192. The number of vehicles allowed for internal use

also reduced from 985 to 745, which consequently reduced the cost and improved traffic situation

within the company. Furthermore, we banned idling of heavy machinery, thus reducing oil use by

more than 10% per month.

Office supplies

The cost of office supplies in 2009 dropped 23% from a year earlier because yardwide saving

activities were carried out such as recycling office equipment and used paper, and collecting idle

office equipment and shelves.

Water and electricity

By changing the application standard of water and electricity rate of dormitory, DSME reduced

costs by KRW80 million in 2009. Moreover, DSME is reducing costs through a variety of activities

such as adjusting the room temperature to 28°C in summer, removing lights in corridors, lounges

and windows and turning off lights in offices and computer monitors during lunch time.

Category ActivitiesRemoving or turning off the lights of corridors, lounges and windows/ Turning off

Electricity computer monitors during lunch time/ Banning the use of individual cooling and heatingfacilities/ Turning off lights before office hour (8 a.m.)

Computer Saving printer toner by lowering print density/ Extension of computer replacement peripherals period

Office suppliesReturning idle office supplies and bookshelves/ Recycling used paper and office equipment/ Readjustment of drawing standards

OilBanning engine idling/ Prevention of long distance movement of heavy machinery/Introduction of fuel card system and two-way (Cooling and Heating) air conditioners

WaterLowering water pressure of wash basin and toilet, Removal of water leakage part, Timereduction of one touch shower, Stop receiving water from cold bath

┃Cost reduction activities┃

Turning off window side lights Collection of used gloves

Hazardous chemical use(unit: ton)

100

75

50

25

0

2008

91.4

2009

35.4

┃Eco activities ┃

Reducing cost through "OK Campaign"

DSME has been promoting the "OK Campaign” in order to reduce sales costs by 20% for the

past three years. In the midst of the current business environment of overall depression, sluggish

orders, and lowering ship price, this campaign targets to obtain fundamental competitiveness by

production and technology innovation beyond "Resource Down 20% Campaign." In 2009, the

production division reduced an additional KRW48.8 billion compared to its original target, and the

technology division also reduced over KRW200 billion through simplifying designs and optimizing

specifications, thus exceeding its original goal by 120%. Furthermore, through PSM (Purchasing &

Supply Management), the Business Support Division reduced expenses by more than KRW200

billion through improving the purchasing method and supply chains as well as localizing materials.

In 2010, DSME will promote the second "OK Campaign" and save costs of KRW630 billion.

Green office

DSME is conducting "Green Office-Document 5S CoP" activities in order to improve office

productivity through effective document management. Through applying 5S activities from the

production line to document management, it increases office productivity by 20%. The business

management team reduced the number of documents per person to 35%, and also reduced the

number of the three-layer bookshelves in the office from 130 to 46. As a result, the number of

shared documents on company intranet greatly increased from five to sixteen documents per day.

In 2010, DSME plans to expand the "Green Office" activities to the whole company.

Green partnership

DSME introduced a 'Green Partnership' program in order to build a mutual green production

system between the parent company and outside partner firms throughout all processes in 2008.

We diagnosed the soundness of the working environment and carried out consultations in each

area of waste, water, air, soil and toxic materials. The six companies with exemplary performance

were awarded 'Green Partnership' certification in 2009. Green partnership was confined to the

ship block manufacturers in 2008. However, we expanded the category to pipe suppliers, painting

firms and our Chinese subsidiary, DSSC (DSME Shandong Co., Ltd.) in 2009. We plan to support

them in obtaining the environmental management system 'ISO 14001', which is an international

environmental certification.

Green certification

DSME introduced an international environmental management system (ISO 14001) and a safety

and health management system (OHSAS 18001), based on which we built a system suitable for

the company and acquired certification from external agencies. We have HSE key persons in every

organization within the company as well as each partner firm to set annual goals and conduct

quarterly internal evaluations on them. Biannual reviews are also made by certification bodies to

ensure our environmental and safety controls are maintained and updated.

'Document 5S' activities (above), Changed office environment after theactivities (below)

8

6

4

2

0

2008

3

2009

6

No. of partners that awardedgreen partnershipcertification

2008 2009 2010 2011 2012

Green partnership

Mid-to long-term management target

1st

phase

2nd

phase

Examination/evalution 6companies

PromotionCertifiction(28% ofpartners)

Certification(36% ofpartners)



Examination/evalution

ISO14001 OHSAS18001

TargetMore than half of the

partner companies will receivegreen partner certification in

2012 by expanding the scopeof partners that receiveexamination/evaluation.

Building...

We imagine a world full of happiness. We draw a world where everyone

lives in harmony. DSME’s outreach to needy neighbors and open

communication with our stakeholders such as customers, partners, local

citizens, stockholders and employees are contained here.

World full of happiness

Social Performance Employee Satisfaction 40

Safety and Health 45

Social Contribution 52


+

EMPLOYEE SATISFACTION

+

40

41

Employee Satisfaction

DSME carries out human resource management in a fair and

rational manner in all areas including recruiting, evaluation,

compensation, and fostering.

┃HR policy ┃

DSME recognizes the importance of employees as the source of a company's competitiveness

and therefore carries out fair and rational personnel policies in all areas such as recruiting,

evaluation, benefit, and training. Especially, under our HR philosophy of fostering elites for the

future as the driving force of the global shipbuilding and marine industry, we have continuously

increased investment in human resource development and training.

Employee management system

Developing talentsEducation for new recruits

Realization of a warm and just personnel management (employment stability / capability oriented personnel management), Hamony between employees and the company

(presentation of growth vision), Cultivation of a sound coopoeative organised spirit

HR with individual / organization's capabilities at the center

Supply of personnelthat confoms

demand

Capability / Results oriented

personnel evaluation

Competitive andreasonable reward

system

Nourishment ofpersonnel withcapabilities andleadership at the

center

Conformationwith

managementstrategy

Support onaccomplishingmanagement

goals

Realizeessential valusof corporate

culture

Creation ofDSME's 100 years history

Mission

HR Direction

HR Practices

HR Fundamental

┃Performance centered evaluation ┃

DSME's performance management

Recognizing that performance-based compensation is crucial to growing into a global leader in the

era of global competition, we are operating a new performance management system which is

totally different from the previous scheme, thus creating a fair evaluation culture.

Performance management system

Through performance management system, DSME is encouraging accomplishments and individual

development that match with our company's future strategy. We are also conducting a transparent

evaluation process based on smooth communications between organizations and team members.

In the meantime, the system is conducive to employee growth and cooperative teamwork.

Performance management system

Capability developmentTeamwork promotion

Growing intothe a world classshipbuilding andmarine company

Realizing corevalues of trustand passion

Creatingcustomer-

oriented value

Realizing the value of

"Global For Most,For FIRST"

Link between Missionand Vision

Connection withbusiness strategy

Re-Alignment

Feedback Feedback

PM Set-up PM ValidationPM Operation

Goal agreement

Performance goal, Capability goal

Goal management

Evaluation, Compensation Education/Development

Achieve businessstrategy

•Internalizing corevalues•Achievement

through work•Respecting

standards and ruleson work

•Establishing andstrengthening theleader trainingsystem (A/L)•Fostering global

elites

•Securing businesscapacity to help thecompany carry outmanagement tasks •Strengthening nece-

ssary capacity foreach level[Job R&R]

•Innovation of on-siteculture•Win-win labor

managementrelationship•Creating an

accident-freeworksite

┃Fostering talents ┃

Our purpose in training talents is to strengthen necessary capabilities of all employees. We also

aim at bolstering internal competitiveness to help us implement our vision and mission

successfully by promoting employees' desire for growth.


+

EMPLOYEE SATISFACTION

+

42

43

Employee development system

Value Creator/Creating high performance [organization member/professional/innovation man]

DSME SpiritCenter

Leadership CenterProfessional

CenterCulture Innovation

Human Performance

Improvement &Support forEmployees' Desire for Growth

Comprehensive heavy industries group

with the capacity to provide total solution

Vision 2020

Traininggoal/direction

5 Core successpoints

HRD strategy

Personnelcultivation mission (including vision)

DSME Leadership Model

HRM (securing talents, placement, evaluation, migration, institution, system

DSME Spirit-(Core value /Attitude) Driven HRD

Competency-Based HRD Innovation-Oriented HRD

Classification Mandatory LearningJob training

Self-Basic course Intensive course

Core talentsdevelopment

┃Office and technical posts┃

Advancement

A-learningNewly appointed leader

Advancement

Breakfast seminarNewly appointed executive

Advancement

Advancement

Advancement

F/U courseO/T Introduction

Executive

Notappointed

Appointed Group leader

General managerexecutive advisor

Deputy manager

Manager

Assistant manager

Below assistantmanager

Domestic/Internationalstudies

GlobalLeader

DSM

EM

BA

Professionallevel

Planningskill/Negotiating

skill

Marine

PM

PracticalEnglishby

team

Languagecourse

Cyber

Com

missioned

trainingto

shipordercom

panies

Com

missioned

trainingto

externalorganizations

Basic courses for generalmanagers

Basic courses for deputymanagers

Basic courses for managers

Basic courses for assistantmanagers

Classification Mandatory Education

Innovationcourse

(selectedemployees or

applicants)

Enhancing workcapability(selected

employees)

Languagecourse(appli-cants)

┃Production posts┃

Workplace HR consultant course (HR 2 group)

Leadership course forexperienced heads

Introduction course for newlyappointed heads

Training courses by jobhierarchy (in case of promotion)

Follow-up course fornewly hired

Appointed

Not appointed

Valueinnovation

course/production

innovationcourse

Safetyeducation

(mandatory)

Quality

education(selected)

Custom

ersatisfactioncourse

Jobtraining

course

Cyber/reading-based

learning

Basic

English

VideoEnglish

Fostering future leaders

We have operated the DSME MBA course, a course for future chief executives, who will lead the

shipbuilding and marine industry since 2004. A total of 138 trainees have completed the course

over five years till 2008, and the 2009 DSME MBA course was conducted over six months as an

intensive course for the 6th class of trainees. The participants took regular MBA classes like future

management, innovative management and leadership as well as having the opportunity to learn

problem-solving skills and global management methods through workshops.

┃Welfare ┃

Housing support

DSME, which has employee apartments with capacity to accommodate 2,300 families and

dormitories with over 2,500 rooms for singles, completed a new dormitory in 2009. The well

equipped Dumo dormitory, with the best residential environment, was built to keep up with the

increasing number of new recruits. Meanwhile, we are also conducting programs such as housing

fund support to help our employees make a stable residential life.

Educational support

We are operating schools that range from kindergarten to high school so that our employees and

their families are provided with good education, and providing high school and college

scholarships not only to our employees, but their families as well. In 2008, DSME bought Geoje

College in order to pre-train professionals for the shipbuilding industry, customize human

resources development for the incumbent employees, and establish a shipbuilding industry R&D

system.

Healthcare support

We operate an affiliated medical clinic, health classes and a healthcare center within the shipyard,

and a general hospital outside the shipyard to support our employees and their families with

regular medical checkups and hospital expenses. Moreover, we support the medical expenses

(operation and hospitalization costs) for immediate family members of our employees with

congenital heart disease and childhood cancer.

DSME MBA intensive course

Dumo dormitoryRegular medical checkups

Onsite

organizationvitalization

course(applicants)


+

EMPLOYEE SATISFACTIONSAFETY AND HEALTH

+

44

45

Supporting expenses for congratulations and condolences

DSME supports not only the various occasions of our employees, but also provides expenditure

for congratulations and condolences of our partner firms' employees and their families. We also

grant our employees leave of absence to raise their morale on the occasion of moving, their 60th

birthday and childbirth.

Cultural and recreational support

We host various cultural events such as concerts, plays, lectures and exhibitions to enhance the

sentiments of our workers and local citizens, and support about 300 groups within the company

dedicated to sports, hobbies, and social relationships. Athletic meetings, talent contests, and

cultural events are also held for foreign workers in our company. Moreover, our employees are

allowed to use the company's condominium to get rest and refreshment, and we are doing our

best to enhance the quality of life of our employees.

┃Employee satisfaction activities ┃

Rewarding outstanding clubs

DSME has rewarded outstanding clubs and provided prize money for the clubs that have

enhanced the company's image internally/externally through various ways like contributing to the

local community, creating a healthy corporative culture and so on. At the 1st Best Club Award held

in 2009, as a means to activate internal clubs, the 'Woojeong Alpine Mountain Climbing Club' won

first place by renovating the walking paths of 10 mountains in the region and holding various social

activities like mountain climbing for the disabled etc. The second place went to the 'Beautiful

Disital Camera World’, who have took a photo services to senior citizens while the third place went

to the 'Geoje Mask Dance Conservationists' who have offered free performances in local events

for the elderly. There are currently 1,494 clubs for sports/leisure, culture/arts, friendship, alumni,

and other sectors.

'Group Counseling Program for Parents'

We operate a group counseling program for parents to provide systematic counseling to

employees with young children and teenagers. The program was created to prevent potential

conflicts within the household like parent-children relationships, education and others and also to

help employees form a happy family. Moreover, with the understanding that a peaceful family

stabilizes the company, we have employed a clinical psychologist and have operated counseling

center called 'Maeumnoori Happy Center' since 2003, to solve personal, work-related problems,

thus enhancing the physical and mental health of our workers.

Labor-management joint culture event 'In unity! To the world!'

DSME held a joint labor-management event 'In unity! To the world!' to express gratitude to our

employees who have worked very hard for the advancement of the company. A total of over

30,000 employees, families, and local citizens participated in various performances and family

programs.

Rewarding well-performing clubsLabor-management joint culture event

┃HSE Credo ┃

We, members of DSME, seek to establish an HSE that sticks to the basics and principles based

on respect for human dignity and love.

Safety and Health

DSME builds a pleasant and safe worksite through operating a

variety of programs such as education, safety inspection, and

health promotion.

•Priority on HSEWe will make no compromises with respect to HSE.

•Preventive ApproachWe will promptly eliminate risk factors upon their discovery and carry out preventive action.

•Health PreservationWe will promote health and improve the work environment to enhance quality of life.

•Environmental ActivitiesWe will carry out environmentally friendly activities to realize pollution-free, green shipbuilding.

•Responsibility and ObligationWe will fulfill our obligations through responsible action.

HSE Code of Conduct

HSE policy

ㅡEstablishing a self-abiding HSE culture•Disseminating IIF culture •Strengthening HSE training by

position•Vitalizing safety communication

(sensitivity safety management)•Strengthening of the HSE role and

responsibilityㅡSecuring a safe working environment•Observing standard work

regulations, practicing JSA•Enhancing on-site HSE activities by

supervisors•Strengthening HSE support for

internal/external partners•Rooting RCA and strengthening

prevention of re-occurrencesㅡSecuring a healthy worksite•Improving the working environment•Improving employee health•Preventing work – related diseases•Strengthening management of toxic

materialsㅡRealizing a comfortable worksite•Reducing wastes and recycling

resources •Abiding by environmental standards

(air, water, soil pollution)•Responding to environmental risks •Broadening the base of green life

Securing a safeworking

environment

Establishing aself-abidingHSE culture

Realizing acomfortableworksite

Securing ahealthy worksite

HSE policy and main direction

HSE vision

HSE operation team

Generalmanager of

shipyard

Safety and healthgroup

HSE customersupport group

Environmentalmanagement group

HSE support group 1

HSE support group 2

Industrial Safety and Health Committee

Transportation SafetyCommittee

Safey representative council of partners inside the company

Safety council of partnersinside the company

Safety council of partnersoutside the company

No injury, no illness,

no pollution

┃HSE management system ┃

In order to protect all workers, equipment, and the environment, DSME is operating its HSE

Management System. This system states the guideline and standards for safety and the

environment and encourages our employees to execute it, and management evaluates the results

of the HSE plan to eliminate and mitigate potential dangers in safety and the environment.

HSE performance indicator management system

We manage HSE performance indicators to evaluate and effectively handle the safety points of

each division, including that of business partners. From April 2010, the ‘HSE performance indicator

standard’ will be subdivided in order to prevent HSE risks and operate HSE performance more

effectively. The new ‘HSE performance indicator’ consists of 6 items of prevention, 6 items of

execution, and injury deduction. Moreover, the new indicator stipulates a stricter rewards and

punishments, and expands individual rewards. Other key changes are as follows: ▲quarterly to

monthly (evaluation period) ▲relative evaluation→absolute evaluation (evaluation method) ▲part

unit→position unit (evaluation unit)▲qualitative→quantitative (evaluation item).


+

SAFETY AND HEALTH

+

46

47

HSE vision

Performance indicator Items

Prevention scoreRegular checking, education, improving human engineering, management

system, daily JSA activity, prevention of near-miss accidentsUse of temporary workforce, voluntary activity to improve HSE, prevention of

Execution score accident reoccurrence, improving the inspection findings, improving the working environment, responding to major requirements of customers

Injury deductionMajor accidents and industrial accidents, small/large/fire/traffic accidents, reporting delays

┃HSE performance indicator structure┃

Performance indicator monitoring byorganization

HSE Management System (OHSAS, EMS)

HSE Code of Conduct(obligation, behavior)

HSE Faith

Unanimous participation(labor/management,partner companies)

Provicing guidelinesFostering awareness and

culture

Promotion

Goalaccomplishment

Result

Education on a systematicapproach

Education on a stronginfluence

Stimulation

Sharing

HSE Vision

People oriented management to improve the quality of life

1. Ordinarysafety

management

2. Dangerouswork

management

3. On-sitesafety

education

4. Safetymanagementactivities in

case ofemergency

HSE PDCA system

Through PDCA (Plan - Do - Check - Act) process that covers from establishing the inspection plan

for each team to conducting improvements, DSME is automating statistics and aggregations on

HSE activities. We are also seeking practical improvements on field safety, strengthening

prevention activities through HSE general performance indicators.

DSME safety inspection system

Weekly inspections by HSE executives and corporate level joint safety inspections are carried out.

In addition, safety inspections focused on risk process are conducted every week while

inspections on a specific process with frequent accidents are done on monthly safety check day.

Other than these, we are constantly pursuing safety management by placing HSE personnel in the

field to support onsite safety activities, dangerous work management, and safety measures in case

of emergency as well as safety training at worksite.

Overview of integrated HSE computer system

On-site activities by HSE support agent

Plan

•Head of team/part (more than two times)•Focused on important

inspection items and sites

Do

•Head of team/group,representativve ofpartners, head of relevantfunction•Inspection visit by HSE

support agent

Inspection

Check

•Items that are pointed out•Action taken immediately,

improvement requestform, amendment requestform, etc.

Issue of improvementreport

Action

Amendmentresult report

On-site confirmation, assessment and feedback by HSE organization

Inspection plan by team(month)

Intensive safety check on dangerousprocessSafety check day Safety training for HSE managers

•Safety gear, safety workstandard•Establishing devices at

safety facilities•Amendment request form,

improvement request form

•Approval of dangerouswork/direct and managesafety•Safety management in

case of major productionevents (large-sizedloading, T/O, etc.)

•Weekly classroomeducation at worksite,safety OJT for the newlyhired employees•Other special safety

education

•Evacuation and responseat early stage in anemergency•Relief and rescue

operation

┃Safety and health education ┃

Safety education system

DSME is conducting various educations by category through its own cyber programs and video

programs.

Safety and health education facilities

We at DSME, conduct an experience-based education that enables trainees to effectively respond

to real situations through the HSE training center. Meanwhile, we were the first company in Korea

to operate a 'mobile safety education bus' and we are conducting field-based education by

request from the field.


+

SAFETY AND HEALTH

+

48

49

DSME HSE education structure

Safety training for supervisors(16H)

HSE cyber education (16H) Training for new headsTraining supervisors

Passion Hanmadang classroomsafety training (1H)

Safety experiment morningsession

Training within eachdepartment

Regular training(office/production posts)

New employee training (8H)Special education withineach department (6H)

HSE support agent on-site safetytraining (2H)

New employees

Industrial healthcourse

HSE management systeminspectors

Commissionedtraining to external

organizations

Rescue/salvage training forfire fightersHSE experts

Cranes Forklift Flaggers FootholdWirelesscranes

GondolaInternal qualification

training

Special safety training on majoraccidents

Explanatory session on workingenvironment evaluation results

External expert lecture

Ship owner/classification agent/inspector Induction training

Special safety training forproject

Internal HSE lecturercertificate course

Internal HSE lecturerreeducation course

Argon/nitrogen gas user trainingSpecial HSE training

Korean language course(40H)

Half-yearly classroom safety training for foreignersForeign workers

HSE training centerSpecial HSE trainingSafety training by organization

Feature •Training hours: 16H (▼ 8H)

•Increasing training concentration level and effectiveness

•Theory and experience (three levels), OJT repeat training

Level 1 •Special education (HSE training center)

- Theory lecture (4H)

- Field education on 7 safety rules (4H)

Level 2 •HSE support agent education (field education)

- Theory lecture (4H)

Level 3 •Education within the deployment department (workplace)

- On-site self-OJT training (6H)

Textbook •Theory (movies and videos), textbooks

Lecture method •Participatory type

Trainer's qualification •All lecturers have relevant certification

Safety education for new recruits

We plan to reform safety education for new recruits from the existing four steps to three steps to

enhance the efficiency of the education, which is carried out for employees from hiring to three

months after joining the company. Moreover, we have advanced our education programs into a

participatory system to enhance understanding of new employees through videos and movies.

Improvement of safety education for new employees

Courses Main contentOffice, technical posts under direct supervision of

HSE cyber education shipyard head/new chiefs and heads of partner

companies/training for heads of group (total 1,462 people)Video education on fall prevention Title: My life partner (shown 100 times)Video education on cycling safety -

Special safety education on major accidentsAll users of argon and nitrogen gasSkid beam collapse, platform fall

Safety education for foreigners by language 15 countries, 1,577 people trained (3 hours every quarter)

┃Main safety training courses┃

Korean language education for foreigners

Executing safety training observation

With our subcontractors, DSME is actively engaged in accident prevention by carrying out safety

training session for various circumstances such as crashes, falls, and flying debris accidents. The

training are carried out by the types of possible accidents in the work fields of each organization to

predict the risk of injuries from various accidents. Education on how to wear safety gear is given at

the same time, maximizing the effectiveness of safety accident precautions.

Korean language education to increase safety consciousness

To increase safety consciousness of our foreign workers and to help them settle quickly, we have

promoted the "Foreigners' Korean language school" for the past 3 years and in 2009, expanded

the program to ship owners and classification members. There are currently 1,300 foreigners

working for DSME. However, since the number of foreign workers increased, we supplemented

safety related materials in our training courses to prevent accidents and also increased the training

period from 8 to 10 weeks, while increasing the number of lecturers from 4 to 11. As a result, the

effects of training are substantially improving.

┃Healthcare activities ┃

Operation of DSHC (DSHC: DSME Smile Health-Care Center)

We map out a plan to operate the DSHC in 2010 with a view to enhancing life quality of our

employees and providing them with an optimal working environment.

DSHC direction

DSME set a DSHC direction by stage to improve the quality of life and to increase life span in the

long term. For this, we plan to facilitate non-smoking, body fat reduction, temperance

improvement and also create a companywide atmosphere for health improvement. We will

drastically lower the rates of smoking and overweight in 2012.


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SAFETY AND HEALTH

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51

Health campaign

Goal of DSHC

Direction by stage

Short-term2010

•Success in quitting smoking (60%)

•Success in reducing body fat (45%)

•Reducing risk of brain cardiovascular(20%)

•Success clinical test results intemperance (20%)

•Creating an atmosphere for healthenhancement

Mid-term2012

•Reducing companywidesmoking rate (20%)

•Reducing companywideoverweight rate (10%)

•Reducing risk of braincardiovascular (20%)

Long-term2012

•Quitting smoking•Decreasing body

fat

•Improving thealcohol drinkingculture

•Looking after thesick (D2) (Braincardiovascular 3main illnesses)

•Health campaign(blood donation/organ donation afterdeath, healthpromotion booth)

Non-smoking,overweight fund

Temperance/Braincardiovascular

Health enhancementclinic

Social contributionactivities

DSHC (DSME Smile Health-Care Center) Operation

Establishing ahealthy and fun business

•Expanding life span

•Improving quality of life

•Creating best workingenvironment

Activities to improve work environment

In 2008, DSME produced a 'guideline for ventilation fans' by establishing methods of ventilation

suitable for the field, based on the 'Ventilation Standardization Consulting' conducted in 2007.

Moreover, in 2009, we established a standard control method in consideration of harmful materials

in each process of building ships. Based on this, we plan to provide an appropriate working

environment for workers by forming the optimal method of ventilation on future marine projects

(Drill-Ship, Rig, FPSO).

Cartoon that shows the effects ofdrinking on safety and health

Improving work environment

Scope Details

Health enhancementSmoke-quitting/overweight fund programTemperance program

Management of 3 main Management program for brain cardiovascular (high blood illnesses in brain cardiovascular pressure/high cholesterol/ diabetes D2 patients)Health campaign Health promotion campaignHealth related social contribution Labor-management joint blood donation/organ donation drive

┃Health improving activity scope┃

Level 1 (Mar. 2009) Level 2 (Apr.~Aug. 2009) Level 3 (Sep.~Nov. 2009)

Selecting demonstrativeworkplace and forming aCommunity of Practice (CoP)

① Selecting demonstrative workplaces:(indoor work) No.2 assembly plant(outdoor work) container ship*Considering measurement resultsand order backlog

② Formation of CoP: (indoor work)production staff of No. 2 assemblygroup (outdoor work) Load/Design/Painting 2 group production staff(support) production support group,equipment support staff, HSE supportgroup, safety and health group, Hulloutfitting design group

Drafting and evaluating thestandard control method

① Process categorization : Processcategorization of standaer controlmethod per harmful factors (consideringthe process flow)

② Designing the standard control method :Forming the control method based onon-site tests and the opinions of workers

③Monitoring working environment : Finaldecision on the control method afterunderstanding workability andeffectiveness of harmful factor control

④ Drafting standard control method:Drafting in consideration of managementorganization and operating method byprocess

Concluding the demonstrativeworkplace and expansion to allworkplaces

·Indoor work: Setting the HSE control

standard to apply to all manufacture

group, assembly 1~5 group

·Outdoor work: Setting the HSE control

standard container, LNGC, Ro-RO,

VLCC/COT, Deck house, PE block


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SOCIAL CONTRIBUTION

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52

53

Social Contribution

•Chairman of Management Committee: Head of GeneralAffairs Team•Member of Management Committee: Secretary general/

secretary/ heads of each organization and 1 nominee•Secretary-general: Head of General Affairs Team•Secretary of Executive Office: 1 dedicated personnel

DSME is leading the way to make the world a better and more

harmonious place through various social contribution activities.

DSME started a social volunteer group consisting mainly of its employees in 1993. Currently, it is

bringing warmth to the society through 'DSME Public charity group', which was established in 2003.

Social contribution system

Social contribution organization

Establishment of infrastructure for social activities (social contribution calender, self-effort management, social contribution fund)

Executives' and workers' social contribution activities based on local community

Korea's representative social contribution activities

Close-to-local type global social contribution activities

DSME's system for social

contributionactivities

Head Deputy Head

ManagementCommittee

Secretary-general

Secretary

Chairman

CommitteeMember

ExecutiveOffice

Public Volunteer's Committee(3,500 members)

Damuldan (2,902 members)

The Sound of New Buds Committee(1,456 members)

True Love Welfare Committee(1,227 members)

Technology Sharing Committee (61 members)

Hope Community Service (83 members)

Name Major activities

Environmental preservationVolunteer activities for local communityLove nationLove companyLove communityCare childrenBlood donationInvite young patientsAssist the elderly who live alone and welfare facilitiesScholarshipBathing for the elderly

Technology Sharing Committee Home building and repairsBathing for the elderlyAssist the elderly who live alone and welfare facilities

┃Major activities of DSME Public Service Group┃

┃Infrastructure for social contribution ┃

Social contribution calendar

DSME operates a social contribution calendar system on the company's portal sites so that any

employee can participate in a volunteer activity of their choices. The social contribution calendar is

designed to automatically link the registered accomplishments to the Social Volunteer History

Management System, which records the contents and number of hours of the person's volunteer

work.

Social contribution award system

We are creating an environment where employees can actively participate in social contribution

activities by granting the social service award to high-performing individuals and groups that have

continuously invested time during weekends and after work in helping out facilities for the

disabled, helping undernourished children, washing and taking care of senior citizens and

conducting other activities.

┃Social Contribution Activities ┃

Cleaning the environment

DSME employees have spent weekends and holidays in cleaning the environment. Moreover, in

2009, 150 new employees picked up trash from the Juklim Beach and cleaned the streets before

participating in their ocean training, a part of their regular orientation. Also, 40 members of the

scuba club helped maintain the Geoje ocean clean by participating in sea cleaning activities.Cleaning the environment

Public Volunteer's Committee

Damuldan

The Sound of New BudsCommittee

True Love Welfare Committee

Hope Community Service

Helping children with leukemia and cancer

'The night of new life, sea festival,' a charity event, designed to encourage children suffering from

cancer and leukemia and to give hopes for recovery, was hosted in Myungsa Beach, Geoje City in

August 2009. The event marking its 20th anniversary has been organized by the DSME volunteer

group, ‘The Sound of New Buds’. Children with leukemia and cancer, their families and hospital

staff from 12 hospitals nationwide and about 700 people from supporting organizations across the

nation including the Korean Association for Children with Leukemia and Cancer (KACLC) attended

the event. Established in 1990, '‘The Sound of New Buds’ is an organization providing support for

children with leukemia and cancer, and has been running campaigns of monthly donations to 30

children with the sickness. In addition, the DSME social service group raised KRW1.3 million by

selling ice cream and other goods at the 'In unity! To the world' joint labor-management culture

event. It was donated to help students of local elementary schools suffering from leukemia.

Furthermore, DSME donated the Safety Award Prize money it had received from the Norwegian

Odfell company to the family members of partner companies undergoing treatment for leukemia.

Bathing service for the disabled

The members of the True love Welfare Group provided social service at SeongSimWon, a nursing

home for elderly citizens with Hansen's disease in Sancheong, Gyeongnam. They cooked food,

cleaned the living areas, and took care of the gardens while also providing KRW2 million worth of

daily goods like soap, toothpaste and others.

Vitalizing the local economy

We have tried to increase sales and vitalize the local economy of small stores in Geoje which suffered

a sales decrease due to the business expansion of Super Supermarkets (SSM) by purchasing

KRW1.8 billion worth of 'Geoje love gift certificates' in time for the Korean thanksgiving day.

Sharing Kimchi

DSME held the first annual Making Kimchi for charity as part of DSME's commitment to the local

community. About 130 volunteers from the client side and classification societies such as

Transocean, Petroserv, OOG (Odebrecht Oil Gas), GrupoR, TMT Drillship, Anangel, and the Okpo

International School as well as 'Hope Community Service' volunteer group made two tons of

Kimchi. It was delivered to 10 welfare organizations in Geoje.

K-point: Knowledge for Colleagues, Love for Neighbors

We donated approximately KRW130 million to Geoje city that was raised through the end-of-the-

year fundraising event for the needy held by the labor-management community. This donation is

being used for building facilities for the disabled, self-support centers, welfare facilities for the

youth, and providing lunch to undernourished children. This donation especially contains the

KRW30 million incentives 'K-Point (Knowledge Point)' received for our activities in the knowledge

management area.

Global Top Cooperative

Our external cooperative council 'Global Top Cooperative' donated KRW5 million to DSME for

helping the needy. This fund was used to support facilities for the elderly and helping underfed

children. Global Top Cooperative regularly donates at the end of every year to help the needy.

Remodeling houses

DSME employees helped remodel houses of senior citizens in the Jangmok-myeon Hwangpo

village and Hacheong-myeon Yoogye village in Geoje through their affiliated social service groups.

The living areas were much improved after changing electric wiring, painting outside walls,

renovating roofs and so on.


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SOCIAL CONTRIBUTIONAWARDS AND RECOGNITION

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54

55

'The night of new life, sea festival'Sharing KimchiGlobal Top Cooperative's donationRemodeling houses

2009•Received Korean Export Management Award by the Ministry of Knowledge

and Economy•Leading Resource Recycling Company by the Ministry of Environment•Won 10 billion dollar Export Tower on the Trade Day•Outstanding security inspection-Best Security Corporation by the Ministry of

Defense

2008•Awarded the Industrial Service Medal and the Presidential Recognition in

Shipbuilding Korea 2008•Awarded the Presidential Award in '2008 Korea IT Innovation Awards'•Global Management Award•Awarded Top Class Company CEO Prize•Obtained ISO 27001 certification

2007•Awarded the Presidential Award in Korea Technology Awards (shared by 3

shipbuilding companies)•CEO Nam Sang Tae awarded Gold Tower Order of Industrial Service Merit,

Won 6 billion dollar Export Tower on the 44th Trade Day•Received Certification of Manufacturer of World's Top Class Products of the

first half of 2007 from Korea Industrial Technology Foundation•Selected as a Company of Excellent Governance by Korea Corporate

Governance Service•Awarded Grand Prize in Large Enterprise Section of the 19th Labor-

Management Cooperation Awards by Korea Employers Federation•Awarded in the Transparent Management Section of the 5th Korea Ethical

Management Awards by New Industry Management Academy

2006•Ghassan Ghandour (Gulf marine) Industrial Service Medal - The 43rd Trade

Day•LGN-RV selected as one of the top ten new technologies

(Ministry of Commerce, Industry and Energy)

2005•Awarded Grand Prize for Best IR of the Year by MoneyToday•Selected as the best corporation in the fourth annual Korean Best

Corporation Awards, Received world-class business grand prize (Korea CEOAssociation)•Awarded 21st Century Management Grand Prize in technology category (The

21st Century Top Management Club)•Won the award for Excellent Transparent Management (Five business

associations)

2004•Awarded Grand Prize for Best IR of the Year by MoneyToday•Won Stevie Awards (IBA)•Won Best Talent Management Award (Korea Management Association)•Won top prize in Green Management Award (Korea Management

Association)•Selected for best corporate governance (CLSA, Asian Corporate Governance

Association) Included in top 6 firms along with Samsung Electronics, POSCO•CEO Jung Sung Leep named the 2004 CEO of the Year in Asia in the

transport category by Asia Equities Market Report (Institutional InvestorResearch Group)•Ranked 19th in sales and net profit among top 100 Korean firms

(Joint selection by Korea Information Service & Hankyung Business Weekly)•Selected for excellence in corporate governance

(Korea Corporate Governance Support Center)•CEO Jung Sung Leep won 13th Dasan Financial Awards' CEO category

(Korea Economic Daily)•Awarded the top prize in community service in local economy category

(Lions Club)•Ranked 3rd in the third annual survey of corporate transparency

(Financial weekly Economy 21, Samsung Economic Research Institute)

2003•Awarded Grand Prize for Best IR of the Year by MoneyToday•CEO Jung Sung Leep awarded Gold Tower Order of Industrial Service Merit,

Won 2 billion dollar Export Tower on the 40th Trade Day•Awarded BP Group's Helios Awards for Performance and Partnership•Awarded Global CEO Prize (Maeil Business Newspaper)•Named the workplace with best health and safety practices in the

shipbuilding industry (Labor Ministry)•Selected for excellence in corporate governance (Korea Corporate

Governance Support Center)

2002•Awarded Tower Order of Industrial Service in Vocational Ability Development

Training Promotion Contest (Ministry of Labor, Human ResourcesDevelopment Service of Korea)•Awarded Best in Corporate Management Improvement

(Korea Management Association)•LNG carrier selected a world-class product

(Ministry of Commerce, Industry and Energy)•Named top investment candidate among domestic shipbuilding industry

(Maeil Business Newspaper)

2001•Obtained OHSAS 18001 certification•Awarded the silver prize in National Convention on Quality Control Circles on

Export Day•LNG carrier awarded Iron Tower Order of Industrial Service Merit for

commercializing new technology (Korean Agency for Technology andStandards)•LNG carrier selected as Korea's top ten products (Samsung Economic

Research Institute)•LNGC IAS certified as New Technology (NT) and Excellent Machine (EM)

(Ministry of Commerce, Industry and Energy)•LNGC IAS, named Korea's top ten new products to lead the new millennium

(Ministry of Commerce, Industry and Energy)•Obtained Defense Quality System certificate (Ministry of Defense)

Awards and Recognition

DSME has grown into a global shipbuilding and marine company

based on excellent technologies and optimal facilities.


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57

Description Index PageCEO message 1.1 p 2∼3

Introduction Company profile 1.2 p 4About the report 1.3 p 0Summary 1.4 -Environmental policy 2.1 p 22

Environmental Mid-to-long-term environmental goals 2.2 p 22Vision and Strategy Environmental goals accomplished in the year 2.3 p 22~23

Environmental goals of the following year 2.4 p 22Environmental management system 3.1 p 23Environmental accident response system 3.2 p 24Environmental audit 3.3 p 24

Environmental Environmental education 3.4 p 27Management System Environmental performance evaluation (EPE) 3.5 p 26

Environmental accounting 3.6 p 25External environmental investment 3.7 -Resource use 4.1 p 34~35Water use 4.2 p 32~33Energy use 4.3 p 36Response to climate change 4.4 p 28~29Use and emission of ozone depletion materials 4.5 p 30Emission of air pollutants 4.6 p 30Emission of water pollutants 4.7 p 33

Environmental Waste discharge and recycling 4.8 p 34~35Impact and Performance Soil contamination management 4.9 2008 ESR

Environmental impact assessment 4.10 -Eco-friendly products 4.11 p 29, 31Eco-friendly packaging 4.12 -Eco-friendly transportation 4.13 p 29Health and safety 4.14 p 45~51Noise and vibration 4.15 -Harmful chemical substance management 4.16 p 36Ecosystem preservation effort 5.1 p 53Eco-friendly supply network management 5.2 p 37

Stakeholders PartnershipLegal compliance 5.3 -Certification and awards 5.4 p 37, 55Environmental communication activities 5.5 p 0, 22Response to international environmental regulation 5.6 p 28

┃General Status┃

Ministry of Environment Environmental Report Guideline

DSME 2009 Environmental & Social ReportReader Survey

•To: DSME HSE Operation Team•Address: 1, Aju-dong, Geoje-si, Gyeongsangnam-do •Fax: 82-55-680-2177

DSME places great value on the opinions of the readers. Please take a moment to consider the

following questions. Your feedback will be invaluably reflected in our future reports.

1. Please state your affiliation.

①Employee ②Shareholder ③Customer ④Supplier ⑤NGOs

⑥Local resident ⑦ Investment analyst ⑧Student or academic ⑨Others

2. How satisfied are you with the report?

①Extremely satisfied ②Satisfied ③Average ④Not satisfied ⑤Extremely not satisfied

3. Which section was of most interest to you?

①Sustainability of DSME ②Economic performance

③Environmental performance ④Social performance

Environmental Management Employee Satisfaction

Activities and Performance Safety and Health

Social Contribution

4. Please comment on areas that need improvement in the report and information you would like to

see in our future reports.

5. If you have further comments, please specify.

※Please provide us with the following information if you would like to

receive the DSME Environmental & Social Report in the future.

Name :

Address :

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•Head Office85, Da-dong, Jung-gu, Seoul

Tel: 82-2-2129-0114 Fax: 82-2-756-4390

•Okpo Shipyard1, Aju-dong, Geoje-si, Gyeongsangnam-do

Tel: 82-55-680-2114 Fax: 82-55-681-4030

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ME

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eport

Documents

Evolution Builder - Amazon Simple Storage Services3.amazonaws.com/zanran_storage/ · As of 2010, DSME is composed of one shipyard, four divisions, three units (Corporate Ethics Office