Lotte Group Chairman Urges Focus on Core Business Strength Amid Growth Stagnation

Lotte Group Chairman Shin Dong-bin has instructed executives to prioritize strengthening the fundamentals of the company's core businesses, particularly as major affiliates face a plateau in growth. Speaking at the '2026 Mid-Year VCM' meeting, Shin stressed the importance of building intrinsic value by focusing on the essence of each business.

While acknowledging that overall operating indicators have improved compared to the beginning of the year, Shin observed that the financial market's assessment remains harsh. He anticipates increased volatility due to global geopolitical changes and a faster pace of technological innovation, especially driven by AI agents. Consequently, he urged company leaders to adopt a multifaceted approach, considering political, economic, social, and technological factors to respond proactively.

Shin expressed concern over the stagnant growth trend of the past decade. He reiterated the need for structural reform, emphasizing three key directions: swiftly divesting non-core businesses that deviate from strategic goals, continuously improving operational efficiency, and adhering to fundamental principles. He also advised rigorous assessment of the effectiveness and return on investment for any new capital injection, ensuring investments remain within manageable financial limits.

Looking outward, Shin cited examples of successful transformations in traditional industries abroad, encouraging continuous innovation. He argued that a company's history and established practices should serve as a launchpad for advancement, not a barrier. Shin concluded by stating that management leaders must set clear objectives, address shortcomings from a customer-centric perspective, and drive disruptive changes to foster organizational development.

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We will focus on strengthening the fundamentals of businesses in a phase of growth stagnation.