SK Chairman Chey Tae-won: Performance bonuses may need adjustment if they harm shareholder interests

SK Group Chairman Chey Tae-won indicated that performance bonuses, particularly the '10% of operating profit' model, may need adjustment if they harm the interests of stakeholders such as shareholders. Speaking at a press conference in Jeju, Chey emphasized that while the happiness of employees is a goal, it must be balanced with the well-being of all stakeholders.

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There is a condition that stakeholders must be happy together.

"There is a condition that stakeholders must be happy together," Chey stated. He added that if the performance bonus system is found to infringe upon shareholder interests, "we must address it for sustainable happiness." This suggests a willingness to revise the current system.

The controversy surrounding performance bonuses, especially the unlimited 10% of operating profit payout agreed upon by SK Hynix and its labor union last September, has drawn significant attention. Samsung Electronics followed suit in May, agreeing to a 10.5% payout for its semiconductor division after labor disputes. The issue has even led to legislative proposals in the National Assembly to exclude performance bonuses from labor disputes.

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If it is judged that the payment of performance bonuses infringes on the interests of stakeholders such as shareholders, we must address it for sustainable happiness.

While Chey acknowledged the positive impacts of the current system and suggested a need to observe further, he also cautioned against immediate reforms. The SK Hynix management recently proposed distributing performance bonuses in the form of stocks instead of cash. The government is also exploring making shareholder approval mandatory for companies distributing performance bonuses.

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I think there are positive impacts, and we need to watch a little longer.