-
- Kyobo Life Faces Industry Downturn and Holding Company Transition, Shin Chang-jae's Weapon is ‘Digital’
- The domestic life insurance market is facing a crisis.
The market has become saturated, and the demand for life insurance, particularly whole life insurance—the core product of the life insurance industry—has decreased due to demographic changes such as low birth rates and an aging population.
Kyobo Life Insurance, in particular, faces an urgent need to enhance its competitiveness as it prepares to transition to a financial holding company next year.
Shin Chang-jae, the owner and chairman of Kyobo Life Insurance, is seeking to overcome this crisis through a digital transformation.
According to Kyobo Life Insurance on the 13th, Chairman Shin and his two sons are focusing on digital innovation to strengthen the company's insurance business competitiveness.
Currently, Kyobo Life Insurance is operated under a dual management system, with Chairman Shin and Co-CEO Cho Dae-gyu each overseeing different business sectors. Shin is responsible for strategy, planning, and asset management, while Cho oversees the insurance business. As a result, the digital innovation project falls under the direct supervision of Shin.
Shin’s two sons are also supporting the digital innovation efforts in key roles within Kyobo Life Insurance and its subsidiary, Kyobo Lifeplanet.
His eldest son, Shin Jung-ha, after graduating from New York University, joined Kyobo Life’s subsidiary, KCA Loss Adjusters, in 2015. In 2021, he led the digital innovation and new business team at Kyobo Information & Communication, the IT subsidiary of Kyobo Life Insurance, and worked on digital operations strategy at Dplanix, another subsidiary. In 2022, he moved to the Group Digital Transformation division and has been serving as Head of Group Management Strategy and Head of the Group Data Task Force since April this year.
The second son, Shin Jung-hyun, after graduating from Columbia University, joined the digital insurance company Kyobo Lifeplanet in 2020 as a manager in the Digital Strategy Department, eventually becoming the department head. Since April this year, he has been the head of the Digital Strategy Office.
The fact that all three members of the Shin family are deeply involved in the digital innovation process stems from their belief that digital transformation is the only way to respond to the rapidly changing insurance market.
In his New Year’s address this year, Chairman Shin highlighted the changes in the life insurance market environment, stating, “Only through innovation can we strengthen the competitiveness of the insurance business and lay the foundation for new business success.” He emphasized the importance of using digital technologies to provide greater value to customers.
In his 2022 New Year’s address, he further elaborated, saying, “The ability to collect and utilize diverse data is the key to corporate innovation and growth in the digital era,” and proposed specific methods for digital innovation.
Chairman Shin’s digital innovation efforts are directly strengthening Kyobo Life’s core insurance business.
In July, Kyobo Life enhanced its app to allow customers, even those without insurance contracts, to easily access financial and health-related services, such as insurance analysis and asset management.
In March, Kyobo Life developed "Kyobo TalkTalk," a mobile messenger-based customer support system that connects KakaoTalk with the company’s existing customer support systems, enabling seamless two-way communication between policyholders and consultants.
In July of last year, Kyobo Life became the first in the insurance industry to introduce a generative AI system, "KyoboGPT," for use by its employees.
Kyobo Life plans to further improve KyoboGPT and expand it into a customer-facing AI service.
In its annual report released in March this year, Kyobo Life stated, “We will enhance our competitiveness by digitally transforming our entire insurance business,” and added, “Through this, we aim to meet customers' needs and provide differentiated customer experiences.”
#KyoboLifeInsurance #ShinChangJae #digitaltransformation #insuranceindustry #KyoboGPT #AIinsurance #financialinnovation #KyoboLifeplanet #digitalstrategy #customerexperience
-
- Hyundai Motor Forms Comprehensive Partnership with Rival GM, Chung Eui-sun Says "Partnership Will Strengthen Competitiveness"
- Hyundai Motor and General Motors (GM) are joining forces in various fields, including the development and production of passenger and commercial vehicles, internal combustion engines, clean energy, and electric and hydrogen technologies.
Hyundai Motor announced on the 12th that Hyundai Motor Group Chairman Chung Eui-sun recently met with GM Chairman and CEO Mary Barra in the U.S. to sign a memorandum of understanding (MOU) to explore cooperation in vehicle technology, supply chains, and clean energy technologies.
Through this agreement, Hyundai and GM plan to work together to reduce costs by leveraging their complementary scales and strengths, while also seeking ways to deliver a broader range of vehicles and technologies to customers more quickly.
Both companies have set plans to further develop the details of their collaboration through comprehensive reviews following this MOU.
Chairman Barra stated, "GM and Hyundai both have complementary strengths and talented teams," adding, "Our goal is to utilize the scale and creativity of both companies to provide competitive vehicles to customers more quickly and efficiently."
Chairman Chung Eui-sun emphasized, "This partnership presents an opportunity for Hyundai and GM to strengthen their competitiveness in key markets and vehicle sectors," adding, "By combining expertise and innovative technologies, we will enhance cost efficiency and increase customer value."
#Hyundai #GeneralMotors #ChungEuiSun #MaryBarra #CleanEnergy #ElectricVehicles #HydrogenTechnology #AutomotivePartnership #SupplyChain #Innovation
-
- Hyundai E&C’s Yoon Young-joon VS POSCO E&C’s Chon Jung-son: Tight Race for Top Spot in Urban Redevelopment Again This Year
- Hyundai E&C CEO Yoon Young-joon and POSCO E&C CEO Chon Jung-son are expected to engage in a fierce battle for the top spot in new urban redevelopment project orders by the end of this year.
Both Hyundai E&C and POSCO E&C have been emerging as leading players in the urban redevelopment market. Industry attention is focused on whether Yoon will maintain his six-year streak as the leader, or if Chon will claim the number one position in his first year as CEO.
As of the 12th, the urban redevelopment industry reports that both Hyundai E&C and POSCO E&C have surpassed KRW 4 trillion in new orders this year, and the competition for first place is expected to continue until the end of the year.
In this year’s race, POSCO E&C has taken the lead while Hyundai E&C is closely following.
On August 31, POSCO E&C secured the redevelopment project for Gilum District 5 in Seongbuk-gu, Seoul (KRW 284.8 billion) and the remodeling project for Mae Hwa Village Phase 2 in Seongnam, Gyeonggi-do (KRW 554.4 billion), making it the first company to surpass KRW 4 trillion in new orders.
Hyundai E&C followed on September 8 by winning the contract for the Goejeong District 5 redevelopment project in Saha-gu, Busan (KRW 719.7 billion), becoming the second company to exceed KRW 4 trillion in new orders.
Looking back at the beginning of the year, POSCO E&C outpaced others by securing the redevelopment project for Promotion District 2-1 in Busan (KRW 1.3274 trillion) in January, overtaking Samsung C&T. After crossing KRW 1 trillion, POSCO E&C was the first to reach KRW 2 trillion and KRW 3 trillion.
Hyundai E&C started its race in March with the urban environment redevelopment project for Jung District 2 in Seongnam, Gyeonggi-do (KRW 678.2 billion), followed by securing the reconstruction project for Hanyang Apartments in Yeouido, Seoul (KRW 774 billion), where it outbid POSCO E&C. Since then, Hyundai E&C has been steadily chasing POSCO E&C.
As of the latest figures, POSCO E&C has secured KRW 4.7191 trillion in new urban redevelopment orders, while Hyundai E&C has accumulated KRW 4.0258 trillion.
Considering that other major construction companies, such as Lotte E&C, Samsung C&T, and Daewoo E&C, have achieved new orders worth around KRW 1.5 trillion, it is clear that this year’s competition for first place is between Hyundai E&C and POSCO E&C.
The rivalry between the two companies is also a clash of leadership styles, as Yoon Young-joon is in his fourth year as CEO of Hyundai E&C, and Chon Jung-son has just started his first year as CEO of POSCO E&C.
Yoon, now in his fourth year, is aiming to extend Hyundai’s five-year streak of topping the urban redevelopment order rankings to six years. Known for his expertise in the housing sector, Yoon has the opportunity to further solidify Hyundai E&C’s dominance in the market. In March, Yoon personally visited the site of the Hanyang Apartments project in Yeouido ahead of the final contractor selection meeting and pledged to build a "landmark with a significant lead," leading to Hyundai’s success in securing the project.
On the other hand, Chon Jung-son, who became CEO of POSCO E&C this year, is proving to be a strong contender despite initial expectations. As a finance and strategy expert with no prior experience in construction, many in the industry expected Chon to take a cautious approach to securing new orders amid uncertain market conditions. However, Chon has been emphasizing selective bidding and has achieved excellent results in terms of project scale.
Hyundai E&C has held the top spot since 2019, while POSCO E&C has secured more than KRW 4 trillion in new orders each year since 2021. Their competition for first place has been a consistent feature of the industry in recent years.
Excluding 2022, when Hyundai E&C set a record with over KRW 9 trillion in new orders, the gap between the two companies has remained within KRW 1 trillion each year since 2020.
Last year’s competition was especially fierce, with Hyundai E&C securing the remodeling project for Gongjak Buyeong Apartments in Anyang, Gyeonggi-do (KRW 290.8 billion) on December 30, resulting in a last-minute reversal in the rankings.
This year, the competition between Yoon and Chon for the top spot is expected to remain unpredictable until the year’s end.
However, the key factor in this year’s race may not be intense bidding wars but rather whether the selection processes for key projects of interest to both companies are completed by the end of the year.
Due to ongoing sole bidding and eventual private contracts, project timelines remain uncertain. The construction industry has seen a trend of avoiding competitive bidding to prevent losses, which has intensified this year.
Since the start of the year, there have only been two major bidding wars between large construction companies: for the Promotion District 2-1 project in Busan and the Hanyang Apartments project in Yeouido, Seoul. Both projects began their selection processes last year.
When comparing the projects that Hyundai E&C and POSCO E&C are interested in, Hyundai appears to have an edge in terms of the size of new orders expected this year.
Hyundai E&C is targeting projects such as the Mia District 9-2 reconstruction project in Gangbuk-gu, Seoul (KRW 600.5 billion), the Sinbanpo Phase 2 reconstruction project in Seocho-gu, Seoul (KRW 1.2831 trillion), and the Yeonsan District 5 reconstruction project in Yeonje-gu, Busan (estimated at KRW 1.4 trillion).
Hyundai E&C is the sole bidder for both the Mia District 9-2 and Sinbanpo Phase 2 projects, making it highly likely to secure both contracts. Hyundai has also expressed interest in the Yeonsan District 5 project, although no companies participated in the first bid after the site briefing.
Meanwhile, POSCO E&C is interested in projects such as the Samho Garden Phase 5 reconstruction project in Seocho-gu, Seoul (KRW 213 billion) and the redevelopment of the east side of Anyang Sports Complex in Gyeonggi-do (estimated over KRW 500 billion).
The Samho Garden Phase 5 project was canceled due to a lack of participating companies in the first bid, but the industry expects a possible bidding war between POSCO E&C and SK Ecoplant.
The redevelopment of Anyang Sports Complex has gone through two rounds of unsuccessful bidding, and the association is now pursuing a private contract process.
An industry insider commented, “Although private contracts are becoming more common in the urban redevelopment market, as the year-end approaches, competition between construction companies for new orders could still intensify at certain project sites.”
#HyundaiE&C #POSCOE&C #YoonYoungjoon #Chon Jung-son #urbanredevelopment #constructionindustry #neworders #redevelopmentprojects #realestatemarket #constructioncompetition
-
- Shinhan Life's Lee Young-jong Sees Strong Performance, Reappointment Likely; Shinhan EZ General Insurance's Kang Byeong-gwan Faces Uncertainty Amid Poor Results
- As Shinhan Financial Group begins the succession process for the CEOs of its subsidiaries whose terms are set to expire, attention is focused on the potential reappointment of Lee Young-jong, CEO of Shinhan Life, and Kang Byeong-gwan, CEO of Shinhan EZ General Insurance, both of whom are up for consideration.
Shinhan Life has continued to post strong performance under the leadership of CEO Lee Young-jong, and the company is also preparing to enter the senior care business, which increases the likelihood of his reappointment.
Lee Young-jong’s term as CEO of Shinhan Life expires in December of this year. However, with continued strong performance and plans for new business ventures, there is speculation that his management success will lead to his reappointment.
On the other hand, Shinhan EZ General Insurance has struggled with underperformance, leading to uncertainty about the reappointment of CEO Kang Byeong-gwan. However, considering that Shinhan EZ General Insurance is a relatively new digital insurer, there is speculation that Kang may be given another opportunity to improve performance.
According to Shinhan Financial Group on the 12th, the group's CEO Recommendation Committee held a meeting on the 10th to begin the succession process for the CEOs of 12 affiliates.
Both Lee and Kang, whose terms expire on December 31, were included in the review, but their contrasting company performances are reflected in differing outlooks for their reappointments.
The strong performance of Shinhan Life is seen as bolstering Lee’s chances of reappointment.
In his first year as CEO in 2023, Lee managed to increase Shinhan Life’s operating revenue, operating profit, and net profit by 1.2%, 19.6%, and 5.1% respectively compared to the previous year.
The positive momentum continued in the first half of this year, with net profit increasing by 0.4% year-over-year to KRW 312.9 billion.
Lee is also preparing to enter the senior care market, seen as a new growth driver for Shinhan Life. This further strengthens the case for his reappointment, with the insurance industry noting the importance of continuity in the company’s business direction.
Lee’s deep understanding of the Shinhan Life organization is another factor in favor of his reappointment.
Lee, a strategic expert at Shinhan Financial Group, previously served as head of the strategic planning team and played a key role in the acquisition of Orange Life. He later became CEO of Orange Life and led the integration of Shinhan Life and Orange Life.
After the integration, Lee served as head of Shinhan Life's strategic planning group and became CEO of Shinhan Life in January 2023, leading the company since then.
Kang Byeong-gwan, CEO of Shinhan EZ General Insurance, is facing challenges due to poor company performance, but some believe he could still be reappointed due to the unique nature of his role as head of a digital insurer and the fact that he was brought in early in the company’s founding.
However, the burden of Shinhan EZ General Insurance’s poor performance clouds the outlook for Kang’s reappointment.
Since its establishment in 2022, Shinhan EZ General Insurance has struggled with losses. The company reported a net loss of KRW 12.7 billion in 2022, KRW 7.8 billion in 2023, and KRW 6.1 billion in the first half of this year.
Despite these losses, some in the insurance industry speculate that Kang may be given another year to turn things around.
Kang was recruited from Samsung Fire & Marine Insurance at the time of Shinhan EZ General Insurance's founding. Given his efforts to lay the groundwork for improving performance, it is possible that he may be reappointed and given another chance to address the company’s underperformance.
Digital insurance companies like Shinhan EZ General Insurance face structural challenges, such as relying on online sales and focusing on short-term, small-scale products, which make it difficult to improve performance.
Kang’s extensive experience in the insurance industry and his relatively younger age as a CEO are also considered strengths, making him well-suited to lead a digital insurer that needs to respond quickly to change.
Born in 1977, Kang graduated from Pohang University of Science and Technology and holds a master’s degree in mathematics from New York University.
He worked at Samsung Fire & Marine Insurance, where he led efforts to establish a digital general insurance company and helped build an integrated platform for Samsung’s financial subsidiaries before joining Shinhan Financial Group. He later led the task force for the acquisition of BNP Paribas Cardif General Insurance and became the first CEO of Shinhan EZ General Insurance.
#ShinhanLife #LeeYoungjong #ShinhanEZGeneralInsurance #KangByeonggwan #ShinhanFinancialGroup #insuranceindustry #digitalinsurance #CEOreappointment #financialperformance #insuranceexpansion #businessleadership
-
- 'Giant' Mirae Asset's Park Hyeon-joo, Relentlessly Marching Toward a Global Investment Bank
- The overseas expansion of domestic financial companies is regarded as a necessity, not an option.
This is because the domestic financial market is considered to have reached its growth limit due to the slowdown in economic growth, aging population, and concerns over household debt.
Among domestic financial companies, Mirae Asset Group stands out as the most proactive in its overseas business efforts.
Park Hyeon-joo, chairman of Mirae Asset Group, turned his attention overseas early on, even during challenging times, to build competitiveness in the global market. At the end of last year, he launched a second-generation management system focused on overseas business, preparing for a new leap forward.
As of the first half of the year, according to the financial investment industry, Mirae Asset Securities operates 12 overseas subsidiaries and 3 overseas offices, totaling 15 international locations, the most among domestic securities firms.
Following Mirae Asset Securities are Korea Investment & Securities (11 locations), NH Investment & Securities (8 locations), KB Securities (6 locations), Shinhan Investment Corp. (6 locations), Samsung Securities (5 locations), and Hana Securities (1 location).
There has been a constant call for the need for overseas expansion in the domestic securities industry, which is already saturated.
In particular, comprehensive financial investment firms (CIFs) with equity capital of over KRW 3 trillion have been criticized for being overly confined to the domestic market, despite their large size. There has been a strong push for these firms to expand abroad and grow into global investment banks.
Although both the Korea Financial Investment Association and financial authorities have promised support and emphasized the importance of overseas expansion for domestic securities firms, significant results have yet to materialize.
Park Hyeon-joo’s efforts to expand Mirae Asset Group overseas are starting to bear fruit.
Last year, among the nine CIFs (Mirae Asset Securities, Korea Investment & Securities, NH Investment & Securities, Samsung Securities, KB Securities, Meritz Securities, Shinhan Investment Corp., Hana Securities, and Kiwoom Securities), only Mirae Asset Securities increased its overseas presence.
Other CIFs either maintained or reduced their overseas operations.
Mirae Asset Securities' confidence in this decision seems to stem from the fact that its overseas subsidiaries have started generating substantial profits.
In the first half of the year, Mirae Asset Securities’ pre-tax profit from its overseas subsidiaries reached approximately KRW 60 billion. The total net profit of its Hong Kong, London, and U.S. subsidiaries was KRW 27.5 billion, while its subsidiaries in Brazil, Vietnam, Indonesia, and India collectively generated a net profit of KRW 30.7 billion. Other regions recorded a net profit of KRW 1.7 billion.
Notably, profits were evenly distributed across various regions, with particularly strong performances in emerging markets.
Mirae Asset Group’s success overseas is not limited to its securities business. Mirae Asset Global Investments has also achieved significant results in its overseas ventures.
As of the end of July this year, Mirae Asset Global Investments' total assets under management (AUM) reached KRW 360 trillion, of which approximately 43% (KRW 156 trillion) was managed overseas.
Mirae Asset Global Investments has aggressively expanded its overseas business through acquisitions, starting with the purchase of the Canadian ETF firm ‘Horizons ETFs’ in 2011, followed by the acquisition of the U.S. firm ‘Global X’ in 2018 and Australia’s ‘ETF Securities’ in 2022.
On September 9th, Mirae Asset Global Investments held a ‘Nasdaq × TIGER ETF Seminar’ in Jongno-gu, Seoul.
This was the first seminar hosted by Mirae Asset Global Investments in partnership with Nasdaq, targeting global investors. At the event, they introduced the world's first AI semiconductor stock index, the 'U.S. AI Philadelphia Semiconductor Index (ASOX).'
There is growing recognition that Park Hyeon-joo's efforts are coming to fruition.
Even during the 2008 financial crisis, Park did not withdraw overseas operations and remained committed to expanding abroad. After moving to serve as Mirae Asset Group’s Global Strategy Officer (GSO) in 2018, he continued to lead the group’s overseas expansion efforts.
In particular, at the end of last year, with the launch of the second-generation management system, Mirae Asset Securities appointed Kim Mi-seop, a global expert, as CEO and promoted Swarup Mohanty, the head of Mirae Asset Global Investments India, to Vice Chairman, further emphasizing its commitment to overseas business.
Currently, India is seen as the market where Park is most focused. Last year, Mirae Asset Securities signed an agreement to acquire Sharekhan, a top-10 Indian brokerage firm.
Sharekhan is the 9th largest brokerage in India, with 3,500 employees and 3.7 million client accounts. It has a solid network with over 130 branches across 400 regions in India and more than 5,000 business partners.
The promotion of Swarup Mohanty as Vice Chairman at the end of last year, the first foreign vice chairman in the group, further highlights Park’s dedication to the Indian market.
Mirae Asset Securities expects its overseas pre-tax profit to grow to KRW 642.2 billion by 2030, with about half of this expected to come from India.
In addition, Mirae Asset Securities has achieved strong results in Indonesia, maintaining the No. 1 market share in stock brokerage among 90 securities firms from 2020 to 2023.
Mirae Asset Securities is expected to generate about KRW 300 billion in net profit from the Indian market in the future.
Park’s foresight in laying the foundation early in emerging markets, where global investment banks have relatively low market share, is now paying off.
In recognition of these achievements, Park was awarded the prestigious 'International Businessperson of the Year' award at the 'Academy of International Business (AIB) 2024 Seoul' event in July this year. He is the first Asian financial professional to receive this honor.
Park recalled that his experience studying in the U.S. had a significant influence on his decision to pursue overseas expansion. After founding Mirae Asset Group, he went to UC Berkeley in the U.S. to study English just three years later.
At the International Businessperson of the Year award ceremony, Park said, “Through my overseas experience, I realized how important it is to diversify investments beyond just the Korean stock market to include overseas markets as well.” This led to the launch of the Park Hyeon-joo Fund, which is based on diversified investment.
Although Mirae Asset Group has begun to see positive results overseas, it is expected that Park will continue to push forward in completing the group's transformation into a global investment bank.
One official who worked closely with Park during Mirae Asset Group's entry into Japan recalled, “Chairman Park never took a day off, even on weekends. If there was something he was curious about, he would call late at night, and this dedication led to Mirae Asset Group's entry into Japan.”
#MiraeAsset #ParkHyeonjoo #globalexpansion #securities #overseasinvestment #India #emergingmarkets #GlobalX #ETFs #investmentbanking #financialmarkets
-
- CJ Group Chairman Lee Jay-hyun's Emphasis on 'Co-Prosperity Management' at Risk of Losing Credibility
- CJ Group is grappling with controversies surrounding unfair practices by its affiliates.
Although CJ Group has implemented various co-prosperity programs in line with Chairman Lee Jay-hyun's "co-prosperity management" philosophy, which emphasizes shared growth with small and medium-sized partner companies and franchisees, the group now faces allegations of unfair practices that threaten to undermine the efforts it has made thus far.
According to the distribution industry on the 11th, while the Fair Trade Commission (FTC) is investigating allegations of abuse of power by CJ Olive Young, there are growing expectations that, if the allegations are confirmed, the penalties could be harsher than last year.
CJ Olive Young is suspected of pressuring purchasing managers from small and medium-sized suppliers who do business with its competitor, Musinsa, to avoid participating in Musinsa's promotional events.
After receiving reports of the allegations, the FTC initiated an investigation. On the 10th, the FTC sent inspectors to CJ Olive Young's headquarters in Yongsan-gu, Seoul, to conduct an on-site investigation and examine documents related to supplier contracts.
Last year, CJ Olive Young faced a similar investigation by the FTC.
At that time, CJ Olive Young was found guilty of coercing suppliers into exclusive participation in its events, failing to return prices to normal after promotional events, and unfairly charging fees for processing information. As a result, the FTC imposed corrective orders and a fine of KRW 1.896 billion (US$ 1.37 million).
The company avoided more severe penalties last year because the FTC did not conclude its review of whether CJ Olive Young abused its market dominance, a key issue. If market dominance had been recognized, some analysts predicted that CJ Olive Young could have been fined several hundred billion won based on its sales volume and the relevant time period.
However, since similar allegations have resurfaced, CJ Olive Young could face heavier penalties if the FTC confirms the allegations this time.
Another CJ Group affiliate, CJ Freshway, was fined KRW 24.5 billion (US$ 17.67 million) last month for allegedly providing illegal support to its subsidiary.
The FTC found that CJ Freshway supported its food distribution subsidiary, Fresh One, by providing personnel and paying their wages (worth approximately KRW 33.4 billion), thus helping Fresh One gain a dominant position in a market largely composed of small and medium-sized businesses.
Given that CJ Freshway's operating profit in the second quarter of this year was KRW 30.1 billion (US$ 21.72 million), the fine is nearly equivalent to the company's operating profit for one quarter.
Fresh One has responded by arguing that the food distribution market consists primarily of small and medium-sized businesses, and its market share is far from dominant. The company plans to explain its position through an administrative lawsuit.
With multiple affiliates embroiled in unfair practice controversies, CJ Group is under significant pressure. Even if the investigations are not yet complete, the group could face both tangible losses in the form of fines and intangible losses, such as damage to its corporate image, simply due to the allegations.
Since CJ Group operates a large number of B2C (business-to-consumer) businesses, corporate image is particularly important.
Although consumer boycotts have not yet gained significant traction against CJ Group, similar companies in the food and retail sectors have faced direct harm from consumer boycotts in the past.
Given CJ Group’s business structure, which involves many partnerships with suppliers and franchisees, there are frequent opportunities for disputes over fairness in business practices to arise.
This is why CJ Group has consistently emphasized co-prosperity management. As part of its co-prosperity efforts ahead of this year’s Chuseok holiday, CJ Group plans to make early payments of KRW 580 billion (US$ 418 million) to over 3,700 small and medium-sized partner companies—the largest amount in its history.
On the 10th, CJ Group Chairman Lee Jay-hyun visited CJ Olive Young’s headquarters in Yongsan-gu, Seoul, to encourage front-line employees. During his visit, Lee stated, “The foundation of the distribution industry is co-prosperity and shared growth. A company that forces its partners to suffer losses cannot grow.”
Chairman Lee Jay-hyun has long emphasized co-prosperity management.
In a meeting with CJ Olive Young employees on January 11 this year, Lee reiterated that “the foundation of the distribution industry is co-prosperity and shared growth. A company that forces its partners to suffer losses cannot grow.”
This visit marked Lee's first on-site visit to an affiliate in nearly five years, and it underscored his commitment to co-prosperity management.
Earlier, on November 3, 2021, Lee announced CJ Group’s mid-term vision through an internal broadcast, stating, “Our affiliates must strongly promote future innovation and growth based on wellness, sustainability, and the global trend of ESG (Environmental, Social, and Governance) management, ensuring that everyone prospers while rejecting unfair practices and power abuse.” He emphasized that co-prosperity management was essential for the group's future.
Following Chairman Lee’s management principles, CJ Group’s affiliates have conducted various activities aimed at fostering shared growth with small and medium-sized partners. These efforts include direct financial support, as well as programs designed to help partners develop new sales channels and support marketing efforts.
However, with its affiliates now entangled in unfair practice controversies, CJ Group finds itself in a difficult situation.
A CJ Olive Young representative stated, “We are deeply regretful that recent controversies involving our partners have surfaced, and we will cooperate fully with the ongoing investigation and take necessary actions.”
A CJ Fresh One representative added, “The food distribution market can be considered a large-scale market worth KRW 64 trillion, depending on how it is defined, and it includes many different types of businesses. It is therefore impossible to say which company dominates the market. For now, our stance remains unchanged, and we will explain our position through administrative litigation.”
#CJGroup #LeeJayHyun #coProsperityManagement #CJOliveYoung #unfairpractices #FairTradeCommission #ESGmanagement #CJFreshway #corporateethics #Koreanbusiness
-
- Will Shinhan Financial's Jin Ok-dong Continue His Long Tenure This Year? Profitability Could Affect Leadership Changes
- Shinhan Financial Group Chairman Jin Ok-dong has begun selecting the next executives who will lead the group's subsidiaries during the latter half of his term.
Last year, during his first year in office, Chairman Jin reinforced responsible management by retaining all subsidiary CEOs, stating that "you don't change generals during a war." However, with the new variable of "value-up" emerging this year, it is speculated that Jin may broaden the scope of executive changes with a focus on profitability.
On the 2nd of this month, Jin Ok-dong, Chairman of Shinhan Financial Group, responded to employee questions at a talk concert held at Shinhan Financial's headquarters in Jung-gu, Seoul.
According to Shinhan Financial on the 11th, the group's CEO Nomination Committee held a meeting the day before and began succession planning for 12 subsidiary CEOs. The results are expected to be announced around early December.
The focus will be on 12 subsidiary CEOs whose terms expire between the end of this year and early next year. This includes CEOs from Shinhan Bank, Shinhan Card, Shinhan Life, Shinhan Capital, Jeju Bank, Shinhan Savings Bank, Shinhan Asset Trust, Shinhan DS, Shinhan Venture Investment, Shinhan REITs Management, Shinhan Fund Partners, and Shinhan EZ General Insurance.
The CEOs of Shinhan Bank, Shinhan Card, and Shinhan Life, which are key subsidiaries of Shinhan Financial, are expected to remain in their positions.
Jeong Sang-hyuk, CEO of Shinhan Bank, Moon Dong-kwon, CEO of Shinhan Card, and Lee Young-jong, CEO of Shinhan Life, have all achieved excellent results and have been supporting Shinhan Financial since their appointment early last year. Typically, CEOs of financial group subsidiaries serve a term of 2+1 years.
Since reappointment is highly likely, market attention is focused on whether Chairman Jin will break with tradition and extend their terms by two years instead of one. At the end of last year, Jin gave Kim Sang-tae, CEO of Shinhan Investment & Securities, and Cho Jae-min, President of Shinhan Asset Management, 2+2 year terms, signaling a strong message of responsible management.
However, given that Jin’s term runs until March 2026, it is more likely that the CEOs of the bank, card, and life insurance subsidiaries will receive only a one-year extension to align with his term.
The atmosphere in other subsidiaries is quite different from that of the major subsidiaries, as their visible performance has not been as strong.
In the first half of this year, Shinhan Savings Bank, Shinhan Capital, Shinhan EZ General Insurance, and Jeju Bank all struggled to overcome difficult business conditions, posting poor results.
Shinhan EZ General Insurance continued to suffer a net loss, while the net profits of Shinhan Capital, Jeju Bank, and Shinhan Savings Bank fell by 43%, 29%, and 27%, respectively, compared to the previous year.
Although Lee Hee-soo, CEO of Shinhan Savings Bank, Jeong Un-jin, CEO of Shinhan Capital, and Park Woo-hyuk, CEO of Jeju Bank, were reappointed at the end of last year, with Chairman Jin's trust, they now face a precarious situation.
Since they have either completed their three-year terms (2+1 years) or surpassed them, there is a possibility that Chairman Jin will aim for a renewal by making changes. If a reshuffle takes place, it could signal Jin’s intention to establish his own leadership style, as these executives were appointed during former Chairman Cho Yong-byeong's tenure.
This upcoming reshuffle is expected to serve as an indicator of Shinhan Financial's future strategy, particularly in non-banking sectors.
Chairman Jin may also use this reshuffle to send a message to the market about his goal to improve the group’s profitability.
Shinhan Financial's stock price has recently soared amid a "value-up" boom, and the group cannot afford to miss this momentum.
As of September 10, Shinhan Financial's stock price had risen 17.5% since the start of the third quarter (from June 28 to September 10), significantly outpacing Woori Financial (6.19%), KB Financial (5.60%), and Hana Financial (1.31%).
At the start of this year, Shinhan Financial's stock price lagged behind KB Financial and Hana Financial due to concerns about potential overhang (excess supply of shares).
This reshuffle is also expected to provide insights into Shinhan Financial's non-banking portfolio strategy.
From Shinhan Financial’s perspective, while Shinhan Bank performed well in the first half, ranking first in net profit among banks, the outlook for the non-banking sector has become critical with interest rate cuts on the horizon.
Given that Chairman Jin has recently emphasized focusing on current business operations rather than new ventures, this round of executive appointments is of great significance. During a talk concert marking the group's 23rd anniversary on the 2nd, he reiterated his intention to concentrate on existing business activities.
Personally, as Chairman Jin approaches the halfway point of his term, next year’s performance—effectively his last year—will be crucial. Jin's term runs until March 2026, leaving about a year and a half remaining.
Chairman Jin has been emphasizing value enhancement and working to strengthen the resolve of employees.
At the 23rd-anniversary talk concert, he stated, "The recently announced plan to enhance corporate value is the minimum goal we must achieve for our survival," adding, "In order to further elevate Shinhan’s value, we must all recognize our current position clearly and approach challenges with a sense of urgency."
#ShinhanFinancial #JinOkDong #leadershipchange #subsidiarymanagement #valuegrowth #bankingprofitability #CEOappointments #nonbankingstrategy #Koreanfinance #Shinhanstock
-
- Hyundai Motor Group: "No Retreat on EVs", Chung Eui-sun’s Steadfast Leadership to Overcome the 'Chasm'
- As the global electric vehicle (EV) market faces a temporary demand stagnation or 'chasm,' automakers are revising their EV-related targets. However, Hyundai Motor Group Chairman Chung Eui-sun has maintained confidence in the inevitable growth of EV demand and has continued with aggressive investments in the sector, despite other global automakers slowing their pace.
Chung has focused on preparing for long-term EV success by ensuring production capacity and a diverse EV lineup, positioning Hyundai for a new leap forward in the EV era. From January to July 2023, EV sales in Europe (EU, EFTA, UK) only grew by 0.6% year-on-year, compared to 62.4% growth during the same period in 2022. In the U.S., first-half 2023 EV sales increased by only 7.3%, down sharply from 47% growth in the first half of 2022.
In South Korea, the situation is more dire, with EV sales falling by 16.5% in the first half of 2023 compared to the same period last year. In 2022, South Korea was the only major auto market to experience negative EV sales growth, down by 1.1%.
In response to this global EV slowdown, many automakers have revised their EV roadmaps. Volvo, for instance, scrapped its plan to sell only battery electric vehicles (BEVs) by 2030, opting instead for 90-100% of sales to be a mix of BEVs and plug-in hybrid vehicles (PHEVs). Toyota lowered its target of selling 1.5 million EVs annually by 2026 to 1 million, while Mercedes-Benz cut its plan for 100% EV sales by 2030 to 50%. General Motors also withdrew its goal of selling 1 million EVs annually by 2025 and postponed production of electric pickups.
In contrast, Hyundai Motor and Kia have retained their ambitious EV sales goals for 2030. Hyundai plans to sell 2 million EVs globally by 2030, comprising 36% of its total vehicle sales, while Kia targets 1.6 million EV sales, making up 38% of its total.
Chung, during a groundbreaking ceremony for Hyundai’s EV-dedicated plant in Ulsan in November 2022, reaffirmed his commitment to aggressive investment in EVs, stating, “In the bigger picture, EV demand will inevitably grow, so we’ll utilize our operational strengths to navigate this period.”
Under Chung's leadership, Hyundai Motor Group has accelerated the completion of its EV-dedicated plant in Georgia (Hyundai Motor Group Metaplant America, HMGMA) and the Ulsan plant, and has adhered to its EV launch schedule.
While Hyundai has lowered its 2026 EV sales target from 940,000 to 841,000 units, Kia has increased its target from 1 million to 1.147 million units by 2027, balancing the overall group's sales goals.
Hyundai and Kia are employing a division of focus in their strategies during the EV transition. Hyundai will emphasize hybrid vehicles, planning to increase its lineup from seven to fourteen models, including five new hybrid models under the Genesis brand. The goal is to sell 1.33 million hybrid vehicles by 2028, a 40% increase over last year's target.
To compensate for the potential loss of EV sales due to this focus on hybrids, Hyundai plans to introduce Extended Range Electric Vehicles (EREVs). EREVs are powered by electric motors, with internal combustion engines generating electricity to recharge the battery. Hyundai expects EREVs to have a driving range of over 900 kilometers per charge, with production starting in late 2026 for the North American and Chinese markets.
Meanwhile, Kia aims to tackle the global EV market slowdown head-on with affordable, high-value electric models. Starting with the recently launched EV3 in South Korea, Kia plans to release six EV models, including the EV2, EV4, and EV5, in major markets such as Korea, North America, and Europe. Kia’s goal is to grow its sales of these mass-market EV models from 131,000 units in 2023 to 587,000 units by 2026.
A Hyundai Motor Group official stated, “We plan to gradually expand our EV lineup, including EREVs, by 2030, when we expect electrification demand to recover. We aim to lead the market by providing consumers with a wide range of choices during the EV era.”
#ChungEuisun #HyundaiMotorGroup #Kia #EVMarket #ElectricVehicles #EREV #HybridVehicles #EVSales #HMGMA #EVInvestments #GlobalAutoMarket #ElectricCar
-
- Naver's Growth Slows, Choi Soo-yeon Aims for Breakthrough with Naver's AI
- Choi Soo-yeon, CEO of Naver, took the helm in 2022 with a mandate to revitalize the organization and secure long-term growth by exploring new business ventures. Since her appointment, Choi has prioritized expanding global operations and developing AI-based new businesses as key challenges.
According to IT industry sources on the 10th, Naver’s need for new growth engines has become more pressing as the growth of its long-standing core businesses, such as search and advertising, has slowed.
Since Choi took office in March 2022, Naver has achieved record earnings. Over her two-year tenure, the company’s revenue grew by 42%, reaching KRW 9.6706 trillion (USD 6.97 billion) in 2023, while operating profit increased by 12%. For the first half of 2024, Naver’s revenue reached KRW 5.1365 trillion (USD 3.7 billion), and the company is expected to surpass KRW 10 trillion (USD 7.2 billion) in annual revenue this year.
However, Naver’s stock price has declined from KRW 300,000 when Choi took office to around KRW 150,000 currently. While Naver was once considered a "national stock" during the COVID-19 boom, the current decline reflects concerns about future growth rather than current strong performance.
Naver’s once double-digit revenue growth has also slowed. From 2019 onward, the company's average annual growth rate exceeded 20%, but by the second quarter of this year, it had fallen to 8.4%. This decline is primarily attributed to the search platform (advertising) and commerce divisions, which accounted for 37% and 26% of revenue in 2022, respectively.
Although Naver continues to generate stable profits from its core businesses, there are concerns about future growth due to reduced consumer spending and intensified competition in the e-commerce market.
Choi is now tasked with identifying new growth drivers for Naver as its high-growth period comes to an end.
Her appointment as CEO in 2022, bypassing other executives and affiliates, was considered bold. Many viewed the appointment of a young leader in her 40s as a sign that Naver was committed to cultural reform and long-term growth. Choi herself remarked at the time, "I was appointed CEO to take on far greater challenges."
Choi is looking beyond the domestic market to find growth opportunities abroad. She has set a goal to achieve 1 billion global users and KRW 15 trillion (USD 10.8 billion) in revenue within five years. As part of her growth strategy, Choi oversaw Naver’s acquisition of the U.S. online fashion platform Poshmark in 2022.
Leveraging the Line platform for its overseas business, Naver plans to accelerate international expansion, particularly as tensions between Japan and South Korea surrounding Line Yahoo subside.
In addition to global growth, Choi is focused on strengthening Naver’s AI business, which is expected to be a core future industry.
As AI’s global impact grows, major IT companies are investing heavily in AI technology development. U.S. Big Tech firms alone invested over KRW 100 trillion (USD 72 billion) in generative AI development last year. In this competitive "money game," Naver, as Korea’s leading IT company, must secure its AI competitiveness, which presents a major challenge for Choi.
While Naver is actively exploring AI business opportunities, it is seen as struggling to compete with global Big Tech in terms of capital and AI-driven profits.
Choi aims to expand Naver’s AI business and generate profits by leveraging the large language model (LLM) HyperCLOVA X, which marked its first anniversary on August 24. She plans to grow B2B services and integrate HyperCLOVA X into Naver’s core search and commerce businesses to enhance profitability.
During the company’s second-quarter earnings call, Choi said, "In the second half of the year, we will accelerate efforts to strengthen our core products and platform capabilities by leveraging AI and data, and we will proactively explore new business opportunities based on technology."
#ChoiSooyeon #Naver #AIExpansion #HyperCLOVAX #GlobalGrowth #SearchAndCommerce #NaverLeadership #NewBusinessOpportunities #PoshmarkAcquisition #DigitalTransformation #TechInvestment