AIIB SK chief stresses importance of fulfilling social responsibility

SK Group Chairman Chey Tae-won delivers a keynote speech during the 2017 Shanghai Forum at Fudan University in Shanghai, May 27. / Courtesy of SK Group

By Lee Hyo-sik

SK Group has set an example for other large business groups by implementing a range of corporate social responsibility (CSR) programs to support small business partners and improve the livelihoods of marginalized people.

Under the leadership of Chairman Chey Tae-won, Korea’s third-largest conglomerate has placed a particular emphasis on fostering social enterprises that cater to solving various social issues.

SK has been extending financial and other support to dozens of social enterprises, which hire the disabled, carry out community improvement programs, protect the environment and conduct other social projects over the past few years.

The group has now begun preaching its “grow together” spirit to its counterparts at home and abroad, encouraging them to do more to fulfill their CSR.

On May 27, Chey delivered a speech at the 2017 Shanghai Forum in Shanghai, urging business leaders to generate not only financial value but also social value to coexist with society.

The forum is the 12th of its kind since 2005. The non-governmental and non-profit academic organization is co-hosted by Fudan University and the Korea Foundation for Advanced Studies (KFAS). Chey has participated every year as KFAS board chairman.

“It has become more difficult not only for the West but also for Asian economies to sustain rapid growth,” the SK chief said. “It is time for us to look back on what we left behind after the era of robust economic growth. Our top priority used to be generating as much financial gain as possible. But we should shift our focus to social issues.”

He said SK Group is looking beyond conventional CSR activities to generate social value.

“It is not only creating job opportunities and looking for coexistence with its business partners,” Chey said. “It is more about generating social value. We should look harder for opportunities to strengthen our core competence to grow together with business partners and other members of society in a sustainable manner.”

The chairman has introduced the social progress credit (SPC) program, one of SK’s experiments of rewarding entities that create social value.

“SK operates 13 social enterprises like Happyschool and Happydosirak, creating 2,500 jobs. We also support dozens more to join our cause through the SPC program,” Chey said.

Happyschool offers after school tutoring programs to students from low-income families and Happydosirak delivers lunchboxes and other food items to senior citizens living alone and other low-income households.

In April, SK offered 4.8 billion won ($4.2 million) to 93 social enterprises, which it estimated to have generated 20.1 billion won in social value. In particular, the firms created a combined 1,368 jobs, valued at 8.41 billion won.

To nurture talented entrepreneurs dedicated to solving social problems through innovative business models, SK established a master of business administration course in 2013 in cooperation with the Korea Advanced Institute of Science and Technology.

The program offers a range of theoretical lectures and field learning activities to enable students to plan business models and put their ideas to work. It has produced 37 graduates, 91 percent of whom have successfully set up social enterprises.

The group plans to extend 12.5 billion won in financial support to the program over the next five years to educate more social entrepreneurs and more effectively help them found startups.

In addition, SK has been organizing a series of seminars all year round, inviting CEOs and executives from its small business partners, to share its knowhow on business planning, finance, marketing, leadership and other aspects of corporate management.

More than 5,500 people have taken part in the seminars since 2007, according to group officials. They also said SK Telecom, SK hynix and other group units have been offering consulting services tailored to each small business partner.

“We have signed a fair trade agreement with our partners, pledging to do business in a fair and transparent manner,” an SK official said. “SK has also extended 617.7 billion won in loans to 951 small firms as part of our efforts to grow with them.”

Plus, the group has been actively implementing community improvement projects abroad.

Since 1996, it has paid for operations on Vietnamese children suffering from facial deformities, with more than 3,700 benefiting from this. SK has also been donating computers and other school supplies to schools in many developing countries.