SK hynix : 2022 Corporate Governance Report

Corporate Governance Report

2022

In accordance with Article 24-2 of the KOSPI Market Disclosure Regulation, SK hynix has completed this report on its corporate governance status to assist investors' understanding. The corporate governance status disclosed in this report is as of December 31, 2022, with any changes occurring between the aforementioned date and the date of submission* indicated accordingly. Moreover, corporate governance activities disclosed in this report are those occurring from January 1, 2022, toDecember 31, 2022, unless otherwise required by the guidelines.

• This English language version is a translation of the original report in Korean that was disclosed onMay 31, 2023. The date of submission refers to the original report in Korean.

-1-

	Contents
Overview	3
Corporate Governance	5
1.	Corporate Governance Policy	5
2.	Shareholders	9
	(Key Principle 1) Shareholders' Rights	9
	(Key Principle 2) Fair Treatment of Shareholders	20
3.	Board of Directors	40
	(Key Principle 3) Functions of the Board	40
	(Key Principle 4) Composition of the Board	49
	(Key Principle 5) Responsibilities of Independent Directors	77
	(Key Principle 6) Evaluation of Independent Directors' Activities	88
	(Key Principle 7) Operation of the Board	90
	(Key Principle 8) Committees of the Board	100
4.	Audit Systems	110
	(Key Principle 9) Internal Auditing Bodies	110
	(Key Principle 10) Independent Auditors	123
[Appendix 1] Conformity Level with the Corporate Governance Key
Indicators	129

-2-

• Overview
• Company Name: SK hynix Inc.
• Date of Report: December 31, 2022
• Company Overview

			SK square and		Ownership of Largest		20.07%
	Largest		9 persons with		Shareholder, etc.1)
	Shareholder, etc.			Ownership of Minor		64.80%
		special interests
				Shareholders2)
							Memory Semiconductor
							products such as DRAM,
	Industry						NAND, MCP (Multi-Chip
						Package), etc., and Non-
	(Finance/Non-		Non-finance		Primary Products
				memory Semiconductor
	finance)
						products such as CIS
							(CMOS Image Sensor),
							Foundry, etc.
	Conglomerate as				Subject to Act on the
	per Monopoly		Yes
			Management of
	Regulation & Fair				No
				Public Institutions
	Trade Act (Yes/No)
				(Yes/No)
	Conglomerate		SK

	Summary Financial Statements (Unit: KRW Billion)
	2022	2021	2020
Consolidated	44,621.6	42,997.7	31,900.4
Revenue
Consolidated	6,809.4	12,410.3	5,012.6
Operating Income

-3-

	Consolidated
	Continuing		6,809.4	12,410.3	5,012.6
	Operations Operating
	Income
	Consolidated Net		2,241.7	9,616.2	4,758.9
	Income
	Total Consolidated		103,871.5	96,346.53)	71,173.9
	Assets
	Total Non-		91,800.2	84,972.5	64,071.0
	Consolidated Assets

1. As of the end of December 2022
2. Minor shareholders holding less than 1% shares, as of the end of December 2022
3. Initial accounting for business combinations was not completed by the end of December 31, 2021, and provisional amounts were reported in the consolidated financial statements for the year ended December 31, 2021. During the year ended December 31, 2022, the provisional amount recognized at the acquisition date was adjusted retrospectively based on the newly obtained information about facts and circumstances that existed as of the acquisition date.

-4-

• Corporate Governance

1. Corporate Governance Policy

1. Corporate Governance Principles and Policies

SK hynix (the "Company") believes that transparent and sound governance serves as a basis for reasonable and responsible business activities and wins the trust of all stakeholders. The Company also believes that it forms the foundation for a sustainable enterprise that generates both economic and social value over the long-term.

As such, the Company has established and seeks to maintain a sound governance structure to not only ensure continued stability and prosperity of its operations but also generate value for its customers, employees, and shareholders, serving as a crucial driver of social and economic growth and contributing to the wellbeing of broader humanity.

The Board of Directors (the "Board") of SK hynix, the Company's highest decision-making body, sets the Company's key business objectives and basic policies while monitoring execution by top management. For the effective performance of its duties, the majority of the Company's Board is comprised of Independent Directors with diverse backgrounds and areas of expertise. Such Independent Directors use their professional knowledge to review the procedural and actual legitimacy of various business activities including management decisions, thereby playing a crucial role in ensuring the soundness of the Company's operations.

B. Corporate Governance Characteristics

(1) Independent Board Composition

As of the date of submission, the Company's Board is currently comprised of ten Directors (two

-5-