Kang Seok-hoon, Chairman of KDB, "Corporate liquidity burden increases due to deepening labor-management conflicts amid complex crises"

Sharing CEO's Management Philosophy and Presenting Second Half Business Plans at the Second Half Management Strategy Workshop
Activating the 'Emergency Management Committee' Within the Organization Considering the Severe Economic Situation

[Asia Economy Reporter Song Hwajeong] Kang Seok-hoon, Chairman of the Korea Development Bank (KDB), warned that in the situation where our economy is facing a complex crisis, intensified labor-management conflicts could increase liquidity burdens on companies.

According to KDB on the 25th, Chairman Kang made these remarks at the '2022 Second Half Management Strategy Workshop' held at the Yeouido headquarters on the 22nd.

Chairman Kang diagnosed, "Our economy is facing a complex crisis due to the recent rise of economic nationalism and profit bloc formation causing global supply chain disruptions, worsening economic instability factors such as high inflation, high interest rates, and high exchange rates, and the resurgence of COVID-19. During this period of interest rate hikes, there is a sharp decline in asset markets, a cliff effect caused by the end of COVID-19 maturity extensions and repayment deferrals, and contraction in startup and venture investments, increasing the risk of liquidity tightening in both financial and real economies." He warned, "Labor-management conflicts that ignore recent industrial damages are intensifying, which could further expand losses for marginal companies and increase liquidity burdens."

Furthermore, Chairman Kang expressed concern that "due to declining corporate vitality and accelerated ultra-aging, our economy may fall into a long-term low-growth trap," emphasizing that "KDB must lead the enhancement of Korea's industrial competitiveness by expanding support for economic security responses, innovative growth, and investments in digital, green, and bio transitions."

In particular, Chairman Kang summarized the key phrase of his business management philosophy as 'Move first! Move forward!' and stressed, "We must boldly discard tasks that should be abandoned and focus on core tasks that only KDB can perform to improve efficiency and work competitiveness." He also added, "We will innovate organizational culture and internal systems by establishing a flexible organizational culture, efficient work environment, and fair personnel system."

Considering the severe economic situation, Chairman Kang declared the establishment of the 'KDB Emergency Economic Response System' based on the judgment that a system capable of preemptive response before an economic crisis occurs is necessary. Accordingly, KDB will continue close policy coordination with the government while operating an internal Emergency Management Committee to closely monitor funding and capital supply situations, the normalization status of troubled companies, and will also make thorough efforts in bank profit and risk management.

The workshop was attended by more than 160 people, including Chairman Kang, executives, department heads at headquarters, and domestic and overseas branch managers, and was broadcast live. Through this workshop, Chairman Kang shared his CEO management philosophy and organizational operation direction with employees for the first time since his appointment as head of KDB on the 7th of last month. The workshop proceeded in the order of sharing the CEO's management message, announcing the second half business promotion plan reflecting the new government's economic policies, and presenting major sales promotion plans of the sales division.