iST pays close attention to climate risks and has referred to the Recommendations of the Task Force on Climate-related Financial Disclosures (TCFD) published by the Financial Stability Board (FSB) in June 2017.In accordance with the TCFD framework, we identified and managed transition and physical risks associated with climate change, conducted financial impact assessments for high-risk factors, and integrated climate change risk considerations into our existing risk management framework. By doing this, we facilitate long-term tracking and ensure the effectiveness of climate issue governance.

The Board of Directors of iST serves as the highest climate governance unit. The ESG Steering Committee, established at the Board level, is the supreme internal body responsible for supervising climate-related risks and opportunities. Furthermore, the Company regularly organizes climate-related training to ensure Board members stay informed of the latest international developments in climate change and possess the necessary climate-related expertise. The ESG Committee serves as a platform for resource integration, project collaboration, and communication across departments. The Environmental Health and Safety Subcommittee serves as the dedicated unit for promoting TCFD and regularly assesses climate-related risks and opportunities. Furthermore, the ESG Secretariat regularly reports on the development of climate-related issues, various risks and opportunities, and future plans and goals to the ESG Committee, ESG Steering Committee, and the Board of Directors. iST facilitates the refinement of its climate risk and opportunity management through mechanisms such as climate-related risk and opportunity identification meetings and the setting of future targets. This allows the Company to consistently address the concerns and expectations of the government and other stakeholders regarding our climate governance.

iST has systematically integrated climate change-related issues into its overall corporate risk management framework. By gathering domestic and international climate research, conducting internal risk identification and assessment procedures, and comprehensively considering stakeholder priorities alongside international sustainability trends, iST continues to identify, analyze, and develop response plans for climate-related risks.

In its risk classification and analysis framework, iST follows the risk framework recommended by TCFD and IFRS S2 to categorize climate-related risks into "transition risks" and "physical risks". The Company analyzes the impacts of policies and regulations, technology, markets, and corporate reputation, as well as acute and chronic climate events.

iST incorporates climate change-related factors into its overall risk management framework, systematically managing the scope and potential impact of climate change risks through a regular process of risk identification, assessment, control, monitoring, and communication.

The Environmental Health and Safety Subcommittee established a preliminary list of climate-related risk and opportunity issues and described the risk implications of each issue by comprehensively referencing international climate change research, stakeholder concerns issues, internal business strategies, and climate issues prioritized by peers and benchmark companies. Furthermore, we designed an internal risk assessment questionnaire and invited department heads to evaluate the potential financial impact and timing of climate-related issues on the Company. The results were then compiled to serve as the foundation for subsequent climate risk management and response planning.

iST continues to implement climate change response strategies, focusing on energy saving and carbon reduction measures—such as improving energy efficiency and expanding the use of renewable energy—as its primary mitigation targets. Since the physical risks faced by iST have been assessed as largely insignificant, we aim to ensure that climate disasters do not lead to production disruptions. Detailed target setting and achievements will be disclosed in the Environmental Sustainability Force Target Management chapter.