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By Nam Hyun-woo
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| Hyosung Chairman Cho Hyun-joon announces the company's transformation into a holding firm structure at the Shilla Hotel in Seoul, on June 1. / Courtesy of Hyosung |
The textile giant adopted a holding firm structure in June, launching four companies under a control tower, Hyosung Corp. With the four firms expected to log solid numbers in their third quarter earnings, outlook is that the company's efforts to improve its governance structure will pick up momentum.
Cho attended the company's non-deal roadshows in Hong Kong and Singapore held from Oct. 3 to 5, and presented the spun-off firms' future growth plan to overseas institutional investors including Goldman Sachs Asset Management and JPMorgan Chase.
"Hyosung transformed into a holding firm structure this year and became more active in communicating with the market to win trust from investors," Cho said during the roadshows. "To help overseas markets understand the company, we will regularly hold overseas roadshows as well as expand the network with global investors."
The move is the latest edition of Cho's efforts to have the company's governance structure more stable and transparent.
In September last year, Cho established a transparent management committee. In its first move, the committee has changed the company's outside director recommendation committee to be headed by outside figures.
Initially, Cho was the head of the outside director recommendation committee, but he handed over the position to former Minister of Environment Kim Myung-ja, in a bid to make the committee more independent.
"With the appointment of Kim, who has rich professional experience, Hyosung has set the basis for raising corporate value and conducting its social responsibility faithfully," a Hyosung official said.
"This development will help the company build transparent management, securing the independence of non-executive directors and strengthening internal monitoring procedures."
Along with the move, the transparent management committee will play a role of preliminarily reviewing the company's primary management plans, such as inspecting the implementation of compliance programs, spin-offs and mergers, M&As, and capital increase and reduction, Hyosung said.
Cho has been placing a strong drive for transparent management and enhanced communication with markets after his appointment as Chairman in January of the previous year.
In August, Hyosung held a "Corporate Day" roadshow event in which the four spun-off firms' heads and chief financial officers met institutional investors and showcased their status and future plans.
The move was seen as a fresh attempt, as Cho carried out his pledge to make the company more transparent and communicating with the market promptly _ less than 100 days after the governance overhaul.
"The improvement plans for corporate governance mean that the company will expand its shareholder policies and strengthen transparent management while enhancing corporate credibility by expanding communication between shareholders and markets," the Hyosung official said.
The company said it will also reinforce its internal accounting monitoring through stronger evaluation of its internal accounting management system, along with expanded education programs for accounting staffers and introducing a more substantive evaluation process.
