Top chaebol groups search for breakthrough strategies

Major conglomerates are holding management meetings to review their performance in the first half of the year and to discuss strategies to avoid crisis in the remaining half of 2023.

SK Group, South Korea's second largest conglomerate group by revenue, held the 2023 Extended Management Meeting on Thursday, gathering top executives of its affiliates to discuss the group's action plans for the second half of the year, and to share their long-term visions.

SK Chairman Chey Tae-won attended the meeting, walking on a set of crutches as he injured his leg playing tennis the previous week. Some 30 chief executive officers of SK affiliates, including SK E&S, SK Telecom, SK hynix and SK Innovation, attended the meeting.

The SK Group executives planned to review business operations for the first half of the year, and share management strategies moving forward.

Semiconductors, which are one of the company's three pillar businesses, is expected to become the key agenda of the meeting, as the sector is where the company has suffered most. SK's other two key business sectors are biopharmaceuticals and batteries.

Management is also likely to address measures to respond to the United State's semiconductor subsidy program, the Chips and Science Act, which intends to ban chipmakers from advancing manufacturing facilities in China in exchange for funding in the US.

In the first three months of this year, SK hynix landed in the red for the second consecutive quarter, logging an operating loss of 3.4 trillion won. The world’s second largest memory chipmaker is also expected to report an operating loss of some 3 trillion won in the second quarter this year.

In last year’s meeting, Chey had underscored how a company’s market competitiveness will depend on whether it achieved carbon neutrality, and stressed SK should reach its carbon neutrality goal faster.

Amid the global economic downturn, other conglomerates are also set to hold management strategy meetings.

Samsung Electronics, which recorded its worst earnings record in the first quarter this year, is set to hold a series of strategy meetings for its business divisions next week.

The meeting for Samsung's Device Solution division in charge of Samsung's semiconductor business, led by the CEO Kyung Kye-hyun, is scheduled to be held on Tuesday. The Device eXperience division led by CEO Han Jong-hee, which is in charge of Samsung's mobile device and consumer electronics, will also hold a two-day strategic meeting from Tuesday.

As the global chip market is suffering from a serious slump in demand and falling prices, Samsung witnessed its worst quarterly operating profit in 14 years in the first three months of this year. It posted 640.2 billion won ($500 million), dipping 96.6 percent on-year, as its sales fell 18.1 percent to 63.75 trillion won.

Hyundai Motor Group, which houses the country's top automakers Hyundai Motor and Kia, is also expected to hold strategic meetings next month to discuss operation plans for the next half of the year.

LG Group, the fourth largest conglomerate, already held a series of strategy meetings presided by the chairman Koo Kwang-mo, to come up with action plans for the rest of the year.

The leaders of the country's top conglomerates accompanied President Yoon Suk Yeol in his state visit to the United States in late April, where they met with key government officials and industry leaders to discuss business cooperation.

Conglomerate leaders, including Samsung Electronics' Lee Jae-yong, SK's Chey and Hyundai Motor Group Chairman Chung Euisun, are also expected to accompany the president on his state visit to Vietnam from June 22 to 24.