"Reduced Working Hours Implemented from the Moment Pregnancy is Confirmed" - 'This Company' with a Sharp Increase in Birth Rate [K Population Strategy]

(45) Gounsaeng Cosmetic, Maker of 'Dr.G'
Boosts Responsibility and Performance Through Autonomy
System Upgraded Annually... Increased Sense of Effectiveness

Editor's NoteThe key to solving South Korea's population problem lies within companies. A workplace culture that evaluates employees based on their work regardless of gender and a family-friendly environment are crucial to addressing the K-population issue. While low birth rates result from complex factors, it is important to ensure that workplace burdens do not become obstacles that make people hesitate to have children. Asia Economy visits companies leading family-friendly policies to identify the factors that helped these systems take root steadily, and plans to explore various solutions with companies that face practical challenges. Through this, we encourage change starting from companies and analyze the government's role in enabling this. We listen to voices emphasizing that company culture and atmosphere that reduce psychological burdens are more important than financial support, and present alternatives from diverse perspectives.

Kim Seon-ho, Team Leader of Talent Development at Gounsesang Cosmetic (left), who is expecting childbirth, and Oh Yong-hwa, Manager of Product Planning Team (BM1 Team), who recently returned from parental leave, are discussing the company's family-friendly policies. Photo by Younghan Heo younghan@

2.70 children. This is the total fertility rate for 2022, self-calculated by Gounsesang Cosmetic, a small and medium-sized enterprise that produces the cosmetic brand 'Dr.G', citing data from Statistics Korea. The total fertility rate refers to the average number of children a woman is expected to have during her childbearing years, and Gounsesang Cosmetic's total fertility rate was three times higher than South Korea's national rate of 0.78 in the same year. This figure is close to Israel's (the OECD country with the highest fertility rate) 3.0 in 2021. In 2019, Gounsesang Cosmetic's fertility rate was only 0.43, but thanks to various family-friendly policies established internally over more than a decade, the fertility rate has sharply increased.

The beginning was flexible working hours. Gounsesang Cosmetic first implemented a flexible clock-in and clock-out system in 2017. Having launched the Dr.G brand in 2003, Gounsesang Cosmetic was expanding from selling products only within hospitals to entering the commercial market. Flexible working hours were introduced with the intention of granting autonomy so employees could focus more on their work. The company believed that giving employees autonomy would also enhance their ability to manage tasks. Kim Sun-ho, Team Leader of the Talent Growth Team, said, “There is a perception within the company that if an employee achieves the goals set for the day, the rest is not the company's management area,” adding, “Creating an environment where employees can focus on achieving their goals is what companies should do.”

From around 2020, Gounsesang Cosmetic became more proactive in introducing policies related to childbirth and childcare. Although legally reduced working hours are only allowed within 12 weeks of pregnancy and after 36 weeks, the company implemented a flexible working system allowing two hours of reduced work from the moment pregnancy is confirmed until childbirth. The childcare leave period was also extended to a maximum of two years, longer than the legal one-year limit. Team Leader Kim explained, “The newly created family-friendly policies align with the life cycles of organizational members.” At that time, Gounsesang Cosmetic had a high proportion of young workers and many female employees. As of 2021, the average age of all employees was 34.5 years, with 65% being young workers (under 35). The proportion of female employees and female executives reached 79%.

As stronger family-friendly policies emerged, actual pregnancies and childbirths among employees increased. The number of births, which was about five per year, exceeded 10 in 2022. Last year, Gounsesang Cosmetic's total fertility rate reached 1.34.

Oh Yong-hwa (35, female), who returned to work last year after 15 months of parental leave, said, “Being a working mom can be challenging, but seeing other employees perform well within this system made me feel that I could raise a child while working here.” She added, “After returning, there was no reduction in my work scope or status.” Oh mentioned that adapting was easier thanks to the company's ‘Supporting Working Moms’ program, which provided guidance on the changed policies and systems upon her return.

Oh drops off her 23-month-old daughter at daycare at 9 a.m. and arrives at work by 9:55 a.m. She only needs to comply with core working hours from 10 a.m. to 4 p.m., allowing her to adjust daily working hours according to personal circumstances. Gounsesang Cosmetic manages working hours monthly based on a 7.5-hour workday. If she arrives late one day, she can make up the time by working longer on other days. Even if she works overtime while telecommuting, the company recognizes it as overtime and grants compensatory leave.

Childbirth Incentive Payments... Policies Upgraded Annually

In 2022, when the total fertility rate exceeded two, the number of employees giving birth surged, with multiple employees in one team taking maternity leave simultaneously. While replacement workers were hired, the company also introduced a ‘Supporters Allowance’ of 100,000 KRW to remaining team members. This was to alleviate concerns about work gaps due to pregnancy and childbirth and to create a celebratory atmosphere. Team Leader Kim explained, “The intention is not only to support the person giving birth but also to give a small reward to team members to foster a genuinely congratulatory environment.”

Based on experiences during the COVID-19 pandemic, the company introduced a care telecommuting system and a serious illness leave system last year. The care telecommuting system allows employees to work from home five days a week if their family members require care due to illness, accidents, or old age. Employees can take up to 10 days of leave annually and up to 90 days of leave of absence. If an employee develops a serious illness while employed, the company provides up to 100 million KRW in medical expense support and up to one year of paid leave, paying 100% of the base salary during the leave period.

Gounsesang Cosmetic's family-friendly policies continue to advance. The Talent Growth Team, which handles HR functions, actively incorporates employee suggestions to create new policies every year. This year, the company introduced support for infertility treatment costs for employees and their spouses, and unlimited paid leave for infertility treatment procedures on the day of treatment. They also support reduced working hours for male employees during their spouse's pregnancy (two hours per month from 36 weeks of pregnancy) and half-day leave for accompanying spouses to fetal checkups. Additionally, employees can take a one-day leave on the day of entrance ceremonies for daycare centers, kindergartens, elementary, middle, high schools, and universities.

The strengthened family-friendly policies have increased employee satisfaction and created a stable work environment, which has also driven the company's sales growth. Gounsesang Cosmetic's sales in 2022 reached 197.1 billion KRW, more than seven times the 26.4 billion KRW recorded in 2017.

Lee Ju-ho, CEO of Gounsesang Cosmetic, emphasized that establishing family-friendly policies is essential for improving employees' work capabilities. Lee said, “A company should be a social institution that supports its members in acquiring lifelong expertise to make a living,” adding, “This forms the foundation for developing good products, benefiting both customers and shareholders.” He also noted, “There are people within the company. The company should be a space that creates opportunities for individual growth through its policies.” Related article: CEO Lee Ju-ho: 'Investment in Employees is the Company's Competitiveness' [K-Population Strategy]

Special Coverage Team 'K-Population Strategy - Gender Equality is the Answer'

Reporters: Kim Yuri, Lee Hyun-joo, Jung Hyun-jin, Boo Aeri, Gong Byung-seon, Park Joon-yi, Song Seung-seop
Editor: Kim Pil-su (Economy & Finance)