[Value-Up Symposium] Cheon Seonghyeon, POSCO Group Leader: "Incorporating Social Value into Business Strategy Post-COVID-19 Is Essential"

POSCO Reflects 'Corporate Citizenship' in Business Strategy
Focus on Six Corporate Citizenship Projects Including Low Birthrate Solutions, Youth Employment, and Startups

Cheon Seong-hyun, Head of the Corporate Citizenship Strategy Group at POSCO Corporate Citizenship Office, is giving a lecture at the "2020 Asia Value-Up Symposium" held on the 22nd at the Chosun Hotel in Jung-gu, Seoul. Photo by Kang Jin-hyung aymsdream@

[Asia Economy Reporter Hwang Yoon-joo] "Changes in corporate management methods after the novel coronavirus infection (COVID-19) are not a choice but a necessity. As part of this, POSCO reflects a management philosophy that pursues economic value through social value in its main business strategies."

Chun Sung-hyun, Head of POSCO Corporate Citizenship Office (photo), stated this on the 22nd at the '2020 Asia Value-Up Symposium' held at the Westin Chosun Hotel in Jung-gu, Seoul, saying, "The criteria for evaluating corporate management after COVID-19 are shifting to how positively companies impact society."

He particularly explained, "As the global economic downturn deepens due to the COVID-19 crisis, new solutions at the corporate level are required, and demands for corporate social participation roles such as quarantine and support for vulnerable groups have increased. To respond to the rapidly changing business environment, companies are also establishing strategies to pursue economic profits through social value (CSR)."

Linking CSR strategies to economic profits has been gradually observed mainly among global companies even before COVID-19. A representative example is the 'Statement on the Purpose of a Corporation' announced by the U.S. Business Roundtable (BRT) in August last year. This declaration, joined by 181 CEOs of major U.S. companies including Jeff Bezos, CEO of Amazon, and Tim Cook, CEO of Apple, conveyed the message of changing the company's fundamental management policy from 'shareholder-centric' to 'stakeholder-centric.'

A month later, the U.S. financial newspaper Financial Times featured a front-page special article titled 'The Changing Capitalism That Shares Performance with Stakeholders,' and the Davos Forum held in January this year also discussed the theme 'Stakeholders for Harmony and a Sustainable World.'

Chun said, "In fact, the demands of POSCO's investment institutions and clients are changing similarly," adding, "Larry Fink, Chairman of BlackRock Asset Management, which holds a 5.2% stake in POSCO, stated in his annual letter earlier this year that companies failing to fulfill responsibilities from an ESG (Environmental, Social, Governance) perspective will be excluded from investment targets."

He emphasized, "If past corporate management was like a 100-meter sprint, the current situation is like a 110-meter hurdles race. POSCO's establishment of the management philosophy 'Corporate Citizenship for Mutual Growth' is also a strategy to become a sustainable company."

'Corporate Citizenship' is a management philosophy declared by POSCO Chairman Choi Jeong-woo after his inauguration. It goes beyond the philosophy that corporate profits are national profits, embodying the meaning that 'sustainable management can be achieved only when companies fulfill social responsibilities.' Currently, POSCO is promoting six major representative practical projects aligned with this management philosophy: ▲win-win growth ▲presenting a role model for low birthrate solutions ▲creating sea forests ▲supporting youth employment and entrepreneurship ▲building a venture platform ▲nurturing global model citizens. The business community evaluates POSCO's six major projects as exemplary CSR cases presenting solutions to social problems.

Chun also stressed that the system for evaluating social value pursuit is as important as the pursuit itself. This is because laws and systems related to non-financial information disclosure obligations are spreading recently. He said, "This year marks the third anniversary of the Corporate Citizenship declaration, and we expect tangible results from corporate citizenship efforts. We will improve the evaluation system that quantitatively measures corporate citizenship performance and institutionalize it as an internal culture."