SK Group Chairman Chey Tae-won called on the board of directors to review the decision-making process of South Korea's second-largest business conglomerate’s overall management activities and actively provide feedback to help CEOs make optimal and balanced decisions, the group said Wednesday.
“By making efforts to promote communication with executives and employees, the board of directors will be able to resolve (the group) affiliates’ problems and inconveniences, while promoting development efficiently,” Chey said in his speech at the SK Directors' Summit 2023, in Seoul on Tuesday.
The SK chairman came up with the idea as he presented his opinion on the role and direction of the SK board of directors, upon his participation in a panel discussion with 14 key affiliate companies’ outside directors at the summit on the day under the theme of the “Future of Governance Story.”
In line with Chey’s desire for fundamental innovation in governance structure, SK introduced its corporate management strategy, called “Governance Story,” in 2021 to build transparent corporate governance based on responsible management led by the board of directors.
Upon the discussion, SK’s outside directors decided to strengthen their systems in which the audit committee under the board of directors directly supervises the group’s internal audit organization to handle management risks in advance and retroactively.
They also agreed to establish a decision-making system that allows board members and SK workers to make specific decisions on investment and management in accordance with policies and regulations set by the board.
To make sure the board functions properly as the highest decision-making body, outside directors decided to enhance their insight into new businesses and strengthen their capabilities for ex-ante audits to minimize possible risks beforehand.
The outside directors reached the deal to expand stakeholder-centric management by actively communicating with stakeholders and investors as they talked about specific measures to enhance shareholder value through board-centered management.
Additionally, the directors examined the global market outlook for SK’s key businesses from electric vehicle batteries to artificial intelligence, and talked about the board’s role regarding business strategy and investment, as well as the direction of board composition for SK’s growth.
SK has been holding the Directors' Summit as a key meeting body since last year. This year’s summit was the second of its kind with the theme of “'Insight for SK's growth.”
The group said it has included the Directors’ Summit in its major annual strategic meeting from this year, alongside an expanded management gathering, a forum in Icheon, Gyeonggi Province, and its CEO seminar.
SK’s outside directors will gather each year at the summit to discuss group management and the agenda centering on governance.
“We ask outside directors to not only supervise and check management, but also understand major group businesses from a larger perspective and actively express opinions to help management,” SK Group Executive Vice Chairman Chey Jae-won said in his opening speech at Tuesday’s meeting.