End of extended management meeting… Request for management improvement through financial story reconstruction
SK affiliates accelerate introduction of sustainable corporate value creation system
SK Group Chairman Chey Tae-won ordered that the management system be reconstructed in a way that maximizes corporate value in response to internal and external crises such as global supply chain disruptions and soaring raw material prices.
The explanation of SK Group is that Chairman Choi emphasized the need for a transition to the so-called ‘SK Management System 2.0’, which puts the enhancement of corporate value as the top priority.
According to SK Group on the 19th, Chairman Choi attended the ‘2022 Expansion Management Conference’ held at the Grand Walkerhill Hotel in Gwangjin-gu, Seoul on the 17th and asked about 30 group executives to do so.
The SK Expansion Management Conference is a place where the group’s top executives gather to discuss management strategies every year. In the same vein, SK Group holds the ‘Icheon Forum’ in August and the ‘CEO Seminar’ in October, respectively.
Chairman Choi emphasized, “The current ‘Financial Story’ was not connected with corporate value.” He emphasized, “We need to reorganize the financial story based on the corporate value analysis model and upgrade it to a new management system.”
A financial story refers to a strategy that creates a growth story with goals and specific action plans that the market can find attractive in addition to existing financial performance such as organizational sales and operating profit, and leads to trust and empathy among stakeholders through this.
Chairman Choi previously declared the ‘first year of implementation’, referring to the need to promote a financial story at an expanded management meeting in June 2020.
Chairman Choi also gave a detailed explanation about this.
First, he said, “Corporate value consists of various factors such as economic value (EV) such as financial performance and future growth potential, social value (SV), tangible and intangible assets, and customer value.”
“The idea is to restructure the financial story so that we can focus on what factors to focus on to increase corporate value and secure greater trust and support from stakeholders, as well as innovation and growth direction.”
In the face of domestic and international economic crises such as global supply chain disruptions and interest rate hikes, SK Group said that Chairman Choi thinks that the overall management system such as the financial story can be improved to not only overcome the crisis but also enhance corporate value.
Chairman Choi also said, “If you analyze the corporate value by limiting the current business model or area, you can fall into the trap of only taking a stand. We need to embark on bold management activities that do this.”
Lastly, Chairman Choi requested a review of new key performance indicators (KPIs), allocation of resources within the company such as investment, budget, and organization, evaluation and compensation, and communication with stakeholders in connection with the results of the analysis of the corporate value model.
He suggested, “Let’s prove our hypothesis that corporate value will be maximized if we create a good financial story and achieve it step by step to increase trust.”
About 30 group executives who participated in the expanded management meeting that day also actively agreed with Chairman Choi’s proposal.
The meeting was attended by Chairman Choi, SK Senior Vice Chairman Choi Jae-won, SK Discovery Vice Chairman Choi Chang-won, SK Supex Pursuit Council Chairman Cho Dae-shik, chairman of 7 committees, and CEOs of major affiliates.
They shared their awareness of the current economic crisis and had heated discussions with external experts on SK’s new management system establishment and new business search methodology.
In addition, they decided to work together to reflect the concept of a sustainable corporate value creation system that each affiliate should pursue in common in the group’s management philosophy and practice method, ‘SKMS’ (SK Management System).
Chairman Cho Dae-sik said, “A bold decision and meticulously prepared execution ability in an area that no one would have thought of trying is essential,” and asked CEOs to work hard to enhance corporate value through the second financial story.
/yunhap news
