CEOs Engage in Heated Discussions on Portfolio Optimization Direction at April 23 'April SUPEX Pursuit Council'
From the left in the photo: Choi Chang-won, Chairman of the SUPEX Council, Jang Yong-ho, CEO of SK Inc., Park Sang-gyu, CEO of SK Innovation. Photo by SK
SK Group CEOs have agreed to swiftly advance the 'Rebalancing' process to review and optimize each business within the group, accelerating efforts to 'Value Up' (enhance corporate value). In particular, they committed to making special efforts to strengthen competitiveness in electric vehicle batteries and green businesses, which are currently facing temporary demand slowdowns.
On the 23rd, SK Group announced that at the April SK Supex Council meeting chaired by Choi Chang-won, Chairman of the Supex Council, over 20 CEOs from major affiliates including Jang Yong-ho, CEO of SK Inc., and Park Sang-gyu, CEO of SK Innovation, attended and shared consensus on this direction and their determination to execute it.
The Supex Council is SK's highest decision-making body based on the unique 'SKMS management philosophy' and the 'together yet separate' culture. CEOs of major affiliates voluntarily participate and meet once a month to discuss current issues within the group.
At the meeting, the CEOs reviewed each company's recent performance and engaged in heated discussions to gather opinions on the direction and implementation plans for the ongoing business portfolio rebalancing within the group since early this year.
The CEOs first acknowledged that there had been shortcomings in sophisticated forecasting and responses to changes in the management environment, such as macroeconomic variables and geopolitical risks, related to investments and businesses of some affiliates.
Chairman Choi Chang-won emphasized, "It is a routine management activity to anticipate environmental changes and adjust plans accordingly. While some businesses have prepared well in advance, it is true that there are areas that have not. CEOs must first adopt a humble and leading attitude to effectively carry out the tasks necessary for future growth."
He continued, "SK possesses business units that have proven strong competitiveness in the global market, a portfolio with sufficient growth potential, and solid technological and business capabilities and resources. For a greater leap forward, let us confidently and agilely reorganize our ranks."
The CEOs also agreed on the need to respond faster to changes, such as optimizing the value chain to the fullest extent possible, tailored to each company's management conditions, acknowledging that they had not fully met the expectations of stakeholders including shareholders and employees.
Since the beginning of the year, SK's major affiliates have launched various task forces to adjust and optimize portfolios considering competitiveness enhancement and efficiency improvement. At the meeting, Jang Yong-ho, CEO of SK Inc., stated, "As the largest shareholder of each business company prioritizing corporate value, I will do my best to improve corporate value and strengthen financial soundness by actively voicing opinions at the board of directors for each company's value-up."
Park Sang-gyu, CEO of SK Innovation, emphasized, "We are rigorously evaluating the SK Innovation affiliate portfolio from multiple perspectives including past and current performance, future outlook, and profitability, and striving to optimally allocate limited resources. We will maximize profitability through operational optimization of existing energy and chemical businesses and work together to enhance the fundamental competitiveness of SK On's battery business."
Earlier, Park expressed at a recent SK Innovation affiliate employee workshop that "the electric vehicle-related business is a 'predestined future,'" reaffirming the commitment to continuous investment and competitiveness enhancement in the battery business.
Other CEOs also agreed to strengthen fundamental competitiveness through technological innovation and operational optimization in business areas such as semiconductors, AI, green business, and bio. SK Hynix plans to solidify its position as a 'Total AI Memory Provider' leading the AI era based on competitiveness in high-performance memory such as HBM. Investments in domestic and overseas sites, including the Yongin semiconductor cluster, will proceed as planned to establish a foundation for future businesses. SK Telecom will focus on realizing results as a global AI company based on its top-tier ICT capabilities.
The CEOs also shared the intention to continue discussing rational value-up measures, and to further devote themselves to portfolio optimization, discovering future growth engines, and securing technological competitiveness.
In his closing remarks, Chairman Choi Chang-won said, "If we set clear goals and concrete plans and execute them fiercely, better opportunities will come. Let us build a stronger SK that continuously enhances business competitiveness and corporate value, meeting the expectations of shareholders, employees, and other stakeholders."
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