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Wallenberg discusses mobile banking, car sharing and 5G

Dec 27,2019
Marcus Wallenberg speaks with the JoongAng Ilbo at the Lotte Hotel, central Seoul. [LEE DONG-HYUN]
Marcus Wallenberg is the fifth-generation leader of his family’s sprawling business empire and the chairman of Skandinaviska Enskilda Banken. When asked about the “optimum corporate governance model,” he gave a rather unexpected answer.

“Our mission is to make investments based on a long-term perspective. It doesn’t matter which one is better: business run by a family or business run by professionals,” Wallenburg said.

“We have our own system - make investments, reinvest profits to research and development (R&D) and give it back to the society.”

Marcus Wallenberg and Jacob Wallenberg, his cousin and the chairman of Investor AB, together are the public face of the Wallenbergs. When the two Swedish business leaders visited Korea as part of a business delegation, the JoongAng Ilbo spoke with them at Lotte Hotel in Sogong-dong, central Seoul. Below are the excerpts from the interview.



Q. Is Wallenberg family’s management motto, which is “esse non videri” or “to be, rather than to seem,” the role model for corporate governance?

A.
Well, Sweden is just a small country in the far north. To explain, our management model includes making investments based on a long-term vision, participating in corporate management through a foundation and creating an ecosystem for the industry. Also, it is our role to invest in education through social contributions. We cooperate with the government as a team, holding company shares, having common values and working together with each company’s board of directors.



What is the principle of Wallenberg family?

The Wallenberg family participates in the management through foundation and through the board of directors of the holding company Investor AB, but we have the same authority as other members of the board. What remains intact generation after generation is that we invest 80 percent of the profits to R&D and focus on raising the value of the company in the long term.



When I visited a Swedish company, it was impressive to see a labor union participating in the board to take equal responsibility and cooperate with the company.

It is based on long-term trust. Union membership rate is high, but [unions] cooperate with the government run by the Social Democratic Party and do not take radical paths. The government doesn’t intervene in a relationship between a union and a company, and the union contemplates what could be the best for the company’s future first and foremost. Executives try to provide information to the union as much as they can, and the union participates in management through the board.



Does the Saltsjobaden Agreement, a landmark grand bargain between Swedish unions and companies reached in 1938, still hold meaning?

Things changed after World War II, and it doesn’t mean that the agreement still works. However, the agreement remains in our way of thinking as a “gentleman’s agreement.” Both sides are figuring out ways to march forward.



What kind of accomplishments did you achieve from this visit?

Just like Korea, Sweden faces a series of challenges in 5G telecommunications, smart cities, smart factories and future finance. On top of them, there is another challenge of sustainable growth. Korea and Sweden can cooperate and secure common interests in many fields. I saw various possibilities and had a lot of conversations with Korean counterparts.



What kind of specific cooperation do you expect?

As a banker, I get a lot of requests for a mobile banking service that runs 24/7, and 5G telecommunications can open up a lot of possibilities. Including car sharing, aviation and life sciences, there are many areas where Korea and Sweden can help each other. For example, though it’s not my company, a Swedish start-up Impact Coding signed a memorandum of understanding with Hyundai Motor at this business summit.



What did you talk about when you met with Samsung Electronics Vice Chair Lee Jae-yong?

We are old friends. We met briefly this time and only had personal conversations. We didn’t talk about business.

[The friendship between Wallenberg and Lee goes back 15 years. The Samsung Economic Research Institute in 2003 studied the Wallenberg family’s corporate governance and social contribution activities.]



Korean society has a mixed opinion about big companies.

The developing speed of Korean companies is surely amazing. Korean people should be proud of so many platforms and products Korean companies have created. I don’t exactly know how Korean people see big companies and why they see them that way, but if two sides build trust by discussing what is best, then they can be proud of the companies.



Between the family management style in Europe and the professional management style in Britain and the United States, which is more appropriate?

Making long-term decisions for the public interest and putting customers first is how we approach the management style, and it has provided great results. There are many corporate governance models that we can adopt. I can’t say which system is better explicitly.



Does your focus on long-term investment get in the way of swift management decisions?

Long-term investment doesn’t mean it’s slow. One industry might require constant change while another might not. Making the best decisions for the future is equivalent to making investments with a long-term vision.

BY LEE DONG-HYUN [kim.byungwook@joongang.co.kr]


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