Chaebol chiefs stress shared growth

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Chaebol chiefs stress shared growth


The New Year’s messages of leading conglomerates yesterday mixed calls for careful growth despite global economic predictions with promises of greater corporate social responsibility (CSR) following the political tide of economic democratization.

Although the messages were not dramatically different from those released in the wake of the global credit crunch in 2008 or the IMF crisis of 1997 - both of which emphasized belt-tightening and seeking out new growth engines - calls for “shared growth” marked a new trend.

This follows President-elect Park Geun-hye’s determination to ease the growing gaps between rich and poor, and large and small businesses, and the conglomerates seemed eager to telegraph their willingness to support the new administration in this respect.

“When the economy faces hard times, companies’ social responsibility programs become that much more important,” said Samsung Electronics Chairman Lee Kun-hee. “Samsung should help create more jobs to fuel the economy and spread hope.”

Samsung seeks innovation

Not for the first time, the nation’s biggest conglomerate made a point of highlighting the need to see out new growth engines this year. Back in 2009, acting chairman Lee Soo-bin made similar calls when he said the group should “start from zero again.”

Flagship Samsung Electronics went from strength to strength last year in terms of sales and market share despite being hit with a record fine of $1 billion in a patent suit with Apple in the United States.

It now ranks as the world’s No. 1 mobile phone maker in terms of annual sales, accounting for 29 percent of the global mobile phone market based on shipments, after it overtook Nokia, whose market share stood at 24 percent last year, according to U.S. market research firm IHS iSuppli.

However, Chairman Lee Kun-hee stressed that the company should not make the mistake of resting on its laurels, but rather embark on scripting entirely new success stories in 2013 while also maintaining its smartphone dominance.

“Our duty is to seek out new challenges and explore new avenues of growth,” Lee said in his New Year’s address at the Shilla Hotel yesterday. “Samsung’s future success depends on how many world-leading products and services it can lay claim to.”

Automaker puts quality first

Hyundai Motor Group Chairman Chung Mong-koo emphasized “brand innovation through product quality” in his New Year’s speech at the company’s headquarters in Yangjae-dong, southern Seoul, yesterday. This marks a slight change in tone from his 2009 address in the wake of global financial crisis, when he focused on increasing sales.

Hyundai, together with its smaller affiliate Kia, now ranks as the world’s fifth-largest automotive group.

“We’ve grown into a global automotive group with an overseas production network in nine countries,” said Chung, 74. “We will focus more on quality growth this year to cement our status as a leading carmaker.”

Last year, the group was hit by a controversy over its misleading fuel-economy readings in North America, denting its brand image and leading to fines in Canada and the United States.

However, Kia also joined the ranks of Interbrand’s 100 best global brands for the first time by coming it No. 87 place. Hyundai was 53rd.

Combined volume sales of the two rose 8 percent on-year to 7.12 million vehicles, despite the deepening global slowdown. Chung said the group has targeted annual sales of 7.41 million units this year, up 4.07 percent.

SK looks overseas

SK Group, which has companies like SK Telecom, SK Innovation and SK Hynix under its belt, is chasing global growth based on more innovation and responsibility management.

Its New Year’s mission statement was vaguer than previous messages issued either amid or in the wake of major financial crises, but industry insiders said it is acting faster this time around to gird itself against external risks, while also adding stability by reorganizing the way it is managed.

As the group celebrates its 60th anniversary, SK Chemical Vice Chairman Kim Chang-geun will take over the helm of its top decision-making organization, known as Supex. Group Chairman Chey Tae-won stepped down to serve as a “supporter” after holding the position since 2004.

Chey, the 52-year-old son of late SK Chairman Chey Jong-Hyon, believes the group’s affiliates should have greater autonomy.

The new Supex chief showed his support for Choi’s “separate, but together 3.0” plan in his New Year’s address, a reference to the group’s annual sales goal of 300 trillion won ($283.43 billion).

“To succeed with the 3.0 plan we need each affiliate to improve its performance and continue raising the overall value of the group,” the 62-year-old said during his speech at the Sheraton Walker Hill Hotel yesterday. “If our employees unite and focus on shoring up the fundamentals, we will be able to overcome most problems.”

LG covets market-leader status

LG has set its New Year’s goal as releasing more market-leading products.

“The reality is that you can’t realize much growth unless you are No. 1 in the market,” Chairman Koo Bon-moo said during his speech. “We need to come up with more leading products to cope with future downside risks.”

His words are seen as being both more specific and more aggressive than the tone he set in 2009, when he said the group needed to focus on its “fundamentals.”

LG Electronics has been trying to regain its footing in the smartphone market recently by introducing its Optimus G. It became the first company in the world to release a 55-inch OLED TV yesterday.

By Joo Kyung-don []
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