[Declaration of Korean BRT] Why Did Companies Bring Up the 'New Entrepreneurship'... The 'Architect' Is Chey Tae-won

Hyundai Motor Contributes to Job Creation by Supporting Startups
Companies Practice Sustainable Development for Stakeholders

New Entrepreneurship Council Launched…Companies Join In
Chairman Choi Shares Growth Ideas Based on Social Responsibility

[Asia Economy Reporter Oh Hyung-gil] Since 2012, Hyundai Motor Group has been supporting young startups with funding and networking through the ‘H-OnDream’ project. This year, it plans to invest a total of 1.16 billion KRW in startups that possess innovative business models and differentiated technologies. Over the past decade, 266 teams have successfully launched startups, creating as many as 4,588 jobs.

The active participation of major domestic business leaders in the declaration of the ‘New Entrepreneurship Spirit’ stems from the recognition that the role of companies in solving social community problems is being emphasized amid unprecedented crises and challenges such as digital transformation, climate change, and demographic cliff.

It is also interpreted that a sense of crisis has played a role, as companies must transform into entities that directly address social issues rather than merely achieving economic value creation, in order to break free from the stigma of anti-corporate sentiment.

It is also significant that society’s perspective on companies is changing as a movement toward sustainable development for stakeholders such as customers, employees, partners, and local communities, moving beyond the simple goal of ‘profit pursuit.’

[Image source=Yonhap News]

"Making money is not the only role of a company"

At the ‘New Entrepreneurship Spirit Declaration Ceremony’ held on the 24th at the Korea Chamber of Commerce and Industry, Ban Ki-moon, former UN Secretary-General, said, "The social role of companies is now the standard," adding, "It is difficult for individual companies to do this alone, but if many join forces and put it into practice, they can lead positive changes in society."

The New Entrepreneurship Spirit embodies the intention to actively respond to this era’s role. It is based on a shift in mindset to proactively solve roles that were previously carried out as additional activities in corporate social contribution or ESG (Environmental, Social, Governance) management. Business leaders also express a strong will to take diverse and concrete actions for the environment, people, and society as an urgent task of the times.

In the United States, companies have already attempted a shift from shareholder primacy to stakeholder capitalism through the Business Roundtable (BRT) declaration. In the statement released in August 2019, they pledged five commitments: delivering value to customers, investing in employees, treating suppliers fairly, supporting communities, and creating long-term value for shareholders. Europe has reinforced corporate social responsibility through initiatives like ‘CSR Europe,’ and Japan through the ‘Corporate Behavior Charter.’

Korean companies have also launched the ‘New Entrepreneurship Spirit Council (ERT)’ centered on the Korea Chamber of Commerce and Industry. They will undertake ‘joint challenges’ involving the economic sector, such as youth employment relays, and ‘individual challenges’ tailored to each company’s capabilities. Planned initiatives include ‘No Pressure’ where all employees leave work on time without hesitation, ‘Zero Plastic Day’ to refrain from plastic use for a day, ‘Jupjup’ which involves jogging while engaging in eco-friendly activities, and the ‘Bring Your Own Container Challenge’ offering discounts for using reusable containers.

At the ceremony, Chung Eui-sun, Chairman of Hyundai Motor Group, said in his congratulatory speech, "We will strengthen the automotive industry ecosystem during the transition to future mobility and contribute to creating jobs for youth and society." Jo Jun-hee, Chairman of the Korea Software Industry Association (CEO of Uracle), who attended the ceremony, stated, "We will address the imbalance and gap in software education opportunities caused by insufficient public education for children," adding, "To this end, we will create separate programs with private educational institutions and collaborate with other software companies to expand support."

[Image source=Yonhap News]

Choi Tae-won: "Companies must earn public trust through new roles"

Choi Tae-won, Chairman of the Korea Chamber of Commerce and Industry, is known as the ‘architect’ of the New Entrepreneurship Spirit. Chairman Choi, who has long been interested in ESG management, has focused on promoting the New Entrepreneurship Spirit since assuming the chairmanship.

The management discourse on social responsibility and growth based on it also originated from his ideas. It is said that he played a key role in encouraging many business leaders, including large corporations, to participate in the declaration of the New Entrepreneurship Spirit.

At the one-year anniversary press conference after his appointment, Chairman Choi emphasized, "Top-down ESG, where the Ministry of Environment allocates free and paid emission credits and demands carbon reduction compared to previous levels, is practically a tax," adding, "There must be a system where companies that perform better ESG activities than competitors receive credit ratings or rewards."

Chairman Choi’s recently emphasized ‘Net Zero Growth Theory’ is in line with this. Although achieving net zero, which means zero greenhouse gas emissions through carbon neutrality, requires significant initial costs, once the breakeven point is surpassed, it will bring enormous benefits.

The declaration of the New Entrepreneurship Spirit announced that day fully reflects his philosophy. The declaration stated, "Korea is facing new crises and challenges such as digital transformation, climate change, demographic cliff, and the pursuit of happiness by social members," and added, "To solve these issues and create a sustainable community, companies must renew their roles and earn the trust of the people."