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POSCO vows to gain respect

Kwon Oh-joon
Kwon Oh-joon
POSCO chairman-nominee Kwon Oh-joon on Friday vowed to regain the public’s respect for the global steelmaker, which has struggled with difficult market conditions and a lack of willingness to innovate.

Faced with the challenge of changing POSCO’s rather rigid corporate culture while also keeping up with the volatile steel industry and streamlining the company’s businesses, Kwon said his biggest goal would be to build a company that can be respected by the people of Korea.

Regarding ways to financially improve POSCO, which has been losing money after numerous attempts at business diversification, Kwon said, “We will come up with a plan to enhance our competitiveness.”

He made the comments on his first day of work as the chairman nominee following his nomination on Thursday.

As the incoming chief, Kwon appeared willing to bring innovation to the company. Formerly run by the government, POSCO in the past was acclaimed for its efficiency and contribution to the local economy.

But in recent years, things began to fall apart and the company was accused of being too rigid and reticent to change with the times.

As a man who has built his career in engineering, Kwon is reputed to be stern and meticulous, traits that will be needed to put in place the necessary reforms, those close to POSCO said.

Kwon is also expected to address the company’s struggles against competition from China and the sluggish global demand for steel products. The global steel industry is currently faced with a so-called “squeezed-margin” environment created by an oversupply of steel coupled with an ongoing oligopoly in the raw material market.

POSCO’s board of directors said they nominated Kwon to combine technology and marketing to enhance the company’s core competence. Kwon will also be pushed to develop new technologies that can be later on nurtured into next-generation growth engines.

“I will study these issues to share with you in the near future,” Kwon told reporters.

Meanwhile, market watchers are hoping the new tech-savvy chief will bring vitality to POSCO stocks that have lost up to 60 percent of their value compared to their peak several years ago. POSCO stocks rose to 316,000 won a share on Friday morning, up 1.44 percent from the previous day. They ultimately closed nearly unchanged at 311,500 won.

By Bae Ji-sook