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Win-win Management

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Win-win
Management

Win-win Management
Hyosung Group’s
Win-win Management

Based on the belief that "partner competitiveness is the company's growth engine" and that "Hyosung shares a common destiny with its partners," Hyosung aims to create a shared future with its partners.

Win-win Management Strategies

Win-win Management
  • Shared
    Growth
  • Fair
    Trade
  • Supply Chain
    Management
  • Shared Growth

    We will pursue shared growth to create sustainable growth engines, jobs, and an economic foundation for a fair society, as well as engage in cooperative activities between companies with a mid- to long-term perspective.

  • Supply Chain Management

    We will develop a supply chain management strategy that can support shared growth and fulfill our social responsibilities through an integrated management of supply chain risks.

    • - Establishment of supply chain management strategies
    • - 공급망 행동규범 준수 지원
    • - Supply Chain Risk Management
  • Fair Trade

    We will promote fair trade and free competition and abide by the basic order of economic activities.

    • - Establishment of fair trade order
    • - Prohibition of abuse of dominance
    • - Prohibition of collusion
    • - Prohibition of unfair trade practices

Win-win management
promotion organization

  • Hyosung
  • Technical cooperation and
    research department
    • Technical cooperation and joint research
  • Business site
    purchase department
    • Partner contract and purchase management
  • Person in charge of
    win-win cooperation (Strategy Division)
    • Operation of support programs
  • Hyosung has a win-win cooperation department in the strategy headquarters that operates the alliance supporting programs. Considering the supply chain's characteristics, purchasing departments manage the alliances for each business site. Thanks to this system, we can listen to and communicate with our partners about their challenges and suggestions, thereby facilitating mutual growth. Moreover, we encourage our partners to participate in research conducted jointly by the Hyosung R&D Center and the Hyosung Power & Industrial Systems R&D Center so as to improve their technological capabilities and competitiveness.
  • We implement numerous support programs for our partners, including financial support, support for technological innovation and R&D, support for growth infrastructure, and support for improving working conditions.

Shared Growth

  • Signing of shared growth
    agreements with excellent partners and cash payments

    Hyosung selects excellent alliances through self-assessment to create a fair-trading culture and mutual growth with alliances. Hyosung annually concludes the shared growth agreements with excellent alliances to support win-win cooperation, such as compliance with fair trade laws and payment in cash. We make sure that our partners receive payment for goods three times per month and improve their cash flow by making cash payments within ten days of tax invoice issuance.

  • Excellent Partner Award

    Hyosung recognizes excellent alliances with a special plaque and prize money for the 'Proud Hyosung Person of the Year'. It helps alliances to understand the purpose of shared growth and be motivated.

  • Energy Companion Project
    with large enterprises
    and SMEs

    To assist partners in saving energy and reducing GHG emissions, Hyosung, together with the Korea Energy Agency, signed business agreements for shared growth with large enterprises and SMEs. We offer our partners energy diagnosis and consulting services. Through a diagnosis of process and workplace environments, energy managers of partners can receive information on factors such as energy saving and GHG emission reduction factors, analysis of problems and economic feasibility, and improvement themes. We endeavor to help our partners receive support for energy-saving facilities where necessary.

  • Support for energy-saving

    By diagnosing partners' facilities, identifying ways to reduce energy loss or consumption, and promoting support projects to replace facilities with high-efficiency ones, Hyosung assists our partners in lowering energy costs and GHG emissions.

  • Provision of individualized
    instruction and
    manuals on ESG

    Through specialized consulting, Hyosung carries out a project that provides education on ESG-related topics, such as human rights, ethics, supply chain, environment, safety, and climate action, in order to increase understanding of partners' ESG activities and facilitate their application to management activities. We have provided ESG management manuals to our partners so that they can respond to the growing demand for sustainability management. In addition, we employ an incentive system which awards additional points in supply chain evaluation for businesses that strive to implement an ESG management system.

  • Partner communication

    To practice shared growth with its partners, Hyosung participates in purchase counseling sessions and visits partners in person to learn about their challenges and suggestions. Partners are open to report unreasonable demands or regulatory violations in transactions via online and offline channels such as hotline and Sinmungo (online reporting system). In addition, we maintain constant communication with our partners in order to foster a relationship of trust, and we operate a number of support programs in conjunction with institutional reorganization to ensure that all partners have equal access to various opportunities.

  • Support for enhancing
    partners' productivity

    To enhance the productivity of partners, Hyosung participates actively in the government's SME support projects, including the performance sharing system, Industrial Innovation Movement, innovation partnership and investment finance project, and management doctor program.

Fair Trade

Four-pillar
plan of action
for fair trade
  • Contract negotiation
    procedure
  • Partner selection and
    operation procedures
  • Written document issuance and
    preservation practices
  • Installation of internal
    deliberation committee and
    operation procedures
  • Establishment of fair trade order

    Hyosung fosters a culture of fair trade with its partners and implements and enforces the Fair Trade Commission-recommended company rules. The company regulations stipulate four fundamental procedures: contract signing, the selection and operation of partners, the establishment and operation of an internal deliberation committee, and the issuance and preservation of documents. By announcing guidelines for the prohibition of retaliatory acts, such as unilateral trade restrictions or suspensions, we hope to lay the groundwork for equitable partnerships and reasonable and transparent trade relationships.

  • Fair trade and social responsibility

    Hyosung complies with the Fair Trade Commission's standard subcontract agreement and applies it to contracts. Clauses guaranteeing the physical and intellectual property rights of partners and the transfer of ownership of objects are included in standard subcontracting agreements, and we are committed to defending both types of property rights.

  • Compliance Program

    Hyosung introduced the Compliance Program (CP), which is conducted by companies themselves to comply with fair trade laws, in September 2006 in an effort to foster a desirable fair trade culture. On June 1, 2018, the date of division, each business company inherited and introduced the plan. The Legal Compliance Team is responsible for the daily operation of the CP and strives to minimize fair trade-related risks through activities such as familiarizing all employees with the program's operating guidelines, fair trade training, and monitoring. The program's CP manager is a compliance officer appointed by the Board of Directors, and the Compliance Program Handbook, where employees can review program operation guidelines, is updated annually to assist employees in complying with fair trade laws and regulations despite changes in ethics-related laws and regulations and the environment.

  • Disclosure of fair trade principles to partners

    Hyosung has enacted the "Partner Code of Conduct" so that Hyosung and its partners can pursue sustainable growth and earn the public's trust. This facilitates the formation of transparent and fair trade relationships and the promotion of social responsibility standards to all of our partners. In addition, by publishing this code on the website, we announce our intention to fulfill it as a social promise, not as a contract with our partners.

Supply Chain Risk Management

  • Enhancement of partner
    registration and evaluation

    Hyosung strives to establish transparent and equitable criteria for selecting partners. The company's shared growth website clearly outlines the mandatory and recommended criteria for bidding participation, and anyone is free to apply for partner registration via the electronic procurement system. We also review the registrations of all new partners before allowing them to participate in the bidding for supply chain risk management. In addition to traditional criteria such as quality, delivery, price, and management performance, indicators for compliance with legal requirements for environment and safety, human rights, and labor are used as evaluation criteria when registering a new partner.

    Hyosung's partner selection procedure
    • Recruitment
    • Review for
      partner selection
    • Selection
      (bidding-contract)
    • Initiation of
      transaction
      (order-receipt)

    Hyosung conducts re-evaluations of existing partners and takes unique follow-up actions based on the evaluation outcomes.

    Evaluation criteria and scoring
    Checklist
    Scoring
    Management evaluation
    50
    Human rights issues
    30
    Environmental and
    safety assessments
    20
    Measures based on supply and assessment
    1. A Over 90 : Priority given to the contract, exempt from reevaluation the following year
    2. B Over 80 : Priority given to the contract
    3. C Over 70 : Maintain transaction
    4. D Over 60 : Warning and guidance, special review within three months
    5. E Under 60 : Stop transaction
  • Pledge to abide by the Partner
    Code of Conduct for shared
    growth

    Hyosung and its partners complete the "Pledge of Compliance with the Partner Code of Conduct" so that they can fulfill their social responsibilities and become companies trusted by the public. Hyosung drafted the Pledge reflecting international standards such as the Universal Declaration of Human Rights, the Ten Principles of the United Nations Global Compact, the core conventions presented by the International Labor Organization (ILO), and the OECD guidelines. It specifies in detail four compliance requirements: corporate operation, respect for the human rights of employees of partners, establishment of a safe workplace, and environmental management responsibility.

    Pledge of Compliance with
    the Partner Code of Conduct
  • Establishment of
    an emergency scenario and
    response manual for supply
    chain continuity

    Hyosung has established scenario training and response manuals for the delivery of all products supplied to customers, thereby enabling systematic response to emergency situations. Such emergencies include labor shortages caused by strikes, transportation accidents, environmental incidents, and cyberattacks. By conducting simulation drills to determine the state and extent of damages, causes, recovery, and mitigating measures due to emergencies, Hyosung derives issues and improvement plans for each stage of response based on the enacted scenario. In addition, such simulation drills ensure the accuracy of the scenario-specific response outcomes.