Lack of New Ventures in Major South Korean Corporations

A recent survey by CEO Score, a corporate data research institute, revealed that over half of South Korea’s major corporations have not initiated any new business ventures in the past five years. This investigation focused on 331 of the top 500 companies in South Korea that have submitted business reports since 2018, finding that 175 companies, or 52.9%, did not introduce any new business objectives during this period.

This trend is evident even among industry leaders like Samsung Electronics, which has not added any new business objectives in the past decade. Such a lack of diversification raises concerns about the long-term strategic planning of these corporations, especially in a rapidly evolving global market.

CEO Score’s findings showed that the remaining 156 companies introduced a total of 684 new business ventures. However, only 487 (71.2%) of these ventures are currently operational, while 197 (28.8%) have yet to commence operations.

Among the firms that added new business objectives, 15, including IS Dongseo, Daou Technology, and Hanwha Ocean, have not seen any of their new ventures become operational.

The survey identified future-oriented automobiles as the most popular new business among the top 500 companies over the past five years, with 22 companies, including Hyundai Glovis, NVH Korea, iMarketKorea, Lotte Chemical, and CJ Logistics, pursuing this sector. For example, Hyundai Glovis has added four business objectives related to future automobile infrastructure, such as electric vehicle charging, hydrogen vehicle charging, and hydrogen storage.

In the energy sector, 17 companies, including HD Hyundai Oilbank, Kyeryong Construction Industrial, Hanjin, Korea Gas Corporation, and S-OIL, have set new business objectives, notably in solar power generation. Companies like Hanjin, BGF Retail, HL Mando, Kyeryong Construction Industrial, Lotte Chilsung Beverage, Harim, and Hotel Lotte are installing solar power generation facilities in idle spaces such as parking lots and factory rooftops. Additionally, Korea Gas Corporation, S-OIL, HD Hyundai Oilbank, Hanwha TotalEnergies, and Daesung Industrial are developing hydrogen energy production and infrastructure.

The AI and big data sector has also garnered significant interest, with 17 companies adding related business objectives. Seven of these are credit finance companies, including Shinhan Card, Hana Card, and Samsung Card. SK Telecom, for instance, is using AI and digital transformation (DT) capabilities for animal hospital X-ray imaging and diagnostic services, while Cosmax operates a hyper-personalized beauty platform using an AI recommendation system.

SK ecoplant has been notably proactive in adding eco-friendly business objectives, currently engaged in 11 such initiatives, including wastewater treatment management, wastewater treatment construction, carbon capture, and energy management systems. Other companies like Hyosung TNC, SK Geocentric, Hyundai Engineering, and Harim are also noteworthy for their involvement in eco-friendly new businesses.

The status of these new business ventures reflects a mixed picture of innovation and operational challenges among South Korea’s top corporations. While some companies are actively pursuing new opportunities in emerging sectors, others remain cautious or face hurdles in implementing their new business objectives. The findings underscore the need for strategic agility and innovation to stay competitive in a dynamic global market.

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