Investment Committee
SK Networks operates an ‘Investment Committee’ to review, deliberate, and make decisions on new investment and disposal, strategic suitability for significant changes in corporate governance, rationality and adequacy of execution, economic feasibility, and risk.
Roles & Organization of the Investment Board
The investment board discusses investment propositions forwarded from pre-reviews in terms of business environment, finance, legal affairs, ESG, and others. and makes a final decision. The working-level investment council moderates risk-focused pre-reviews of investment propositions before forwarding them to the investment board.
Before an investment proposal is submitted to the Investment Review Working Group, the Agenda Review Committee conducts a preliminary assessment to determine whether the proposal qualifies for submission to the Investment Committee 1). The Red Team serves as a dedicated oversight body, formed on a temporary basis for each proposal, and operates independently from the initiating department to analyze risk factors and assess investment feasibility2). For proposals requiring Board approval, the Red Team submits its findings, including worst-case scenarios projections, separately to both the Investment Committee and the Board of Directors 3).
1) The Internal members of the Agenda Review Committee are the same as those of the Investment Review Working Group
2) The Red Team operates as a virtual task force under the Chief Financial Officer (CFO), led by the Head of Risk Management and composed of team members from the Investment Review Working Group
3) Proposals involving changes to existing investment amounts or expansions of ongoing businesses are generally excluded from review. However, exceptions may be granted subject to management’s decision and approval by the Agenda Review Committee.
- Members: CEO, COO, Head of AI Division, Head of the Management Supporting Division, Head of Strategy Planning Division, Head of RM Division, Head of Sustainability Management Division
- Secretary: Head of AI Portfolio Innovation Division
/ Agenda Review Committee
- Members: Global Investment Group Team Leader, Strategy Planning Team Leader, Finance Team Leader, Accounting Team Leader, Tax Team Leader, Legal Team Leader, ESG Management Team Leader, RM Part Leader
- In the case of purchasing for investment, Supply Chain and Asset Management Team Leader is also included
Investment Process
- Initiating Department
- Agenda Review Committee
- Investment Review Working Group
- Investment Committee or Internal Investment Committee
- Result Notification
- Board Resolution
- Shareholders' Meeting
- ※ Decision Criteria: Strategic Alignment, Risk & Compliance (R&C) Strategy, Valuation, Milestones, Key Issues & Contingency Plans, ESG/Social Value (SV), Exit Plan, and other relevant factors ※ Investment Committee Approval Criteria: Approval requires the attendance of at least two-thirds of all committee members and the affirmative vote of at least two-thirds of those present.
* For investments subject to Board approval, a preliminary review shall be conducted by the Strategic ESG Committee, followed by final review and resolution by the Board of Directors.
SK Networks has classified first-tier subsidiaries and two second-tier subsidiaries into three groups taking into consideration their listing status, equity holding ratio, and growth stage and specified ESG management visions and targets per subsidiary group. Each subsidiary will improve their ESG management standards phase-wise by defining and achieving short to mid-term targets per ESG metric.
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Listed/non-listed
For listed subsidiaries, select extensive management metrics similar to those adopted by the parent company and improve performance on a variety of ESG metrics
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Equity holding ratio (80% or higher)
For non-listed subsidiaries in which the parent company holds 80% or more of equity, select their ESG performance to a standard similar to that of listed subsidiaries
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Growth stage (in terms of time elapsed from spin-off)
For new subsidiaries (two years or less from spin-off), select and manage a minimum set of essential ESG metrics and then expand the scope of ESG management step by step considering their industrial characteristics/growth level
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First/second-tier subsidiaries
Empower first-tier subsidiaries to manage and align the ESG performance of second-tier subsidiaries to their ESG vision and targets
We aim to enhance the ESG standards of listed and unlisted subsidiaries (with over 80% ownership & in the growth stage) by conducting status checks, implementing short/mid-term tasks, and publishing sustainability reports. Our ultimate goal is to have all subsidiaries/sub-subsidiaries reach top-tier levels by 2026. Furthermore, to reinforce execution capabilities, SK Networks holds SV Meetups where executives, team leaders, and working-level employees from business units/subsidiaries gather to share and discuss ESG initiative progress for each business, fostering mutual learning.
Roadmap
- Develop an ESG management policy for first/second-tier subsidiaries (2022)
- Monitor the ESG status of major subsidiaries, specify short to mid-term targets and perform short-term tasks
- Monitor the ESG status of major subsidiaries regularly and have them perform mid-term tasks to bring their ESG performance up to the SK networks level (2025)
- Perform short/mid/long-term tasks aligned with the ESG level of each first/second-tier subsidiary group
- Ensure that all first/second-tier subsidiaries reach a global top-tier level (7 subsidiaries now)
- Upgrade ESG management policies (key metrics) of first/second-tier subsidiaries (e.g. selection of subsidiary-specific indicator)
ESG Management Performance/Achievement
- Since 2020, the SV Meetup has been organized, involving all business units/subsidiaries, to monitor and manage the ESG status across these subsidiaries and sub-subsidiaries.
- SK Networks and eight subsidiaries and sub-subsidiaries committed to Net Zero 2040 in 2021, joined the EV100 initiative in 2021, signed up for the SBTi in September 2022, and received target approval in August 2023.
- Disclosure of significant ESG achievements from SK Magic, SK Networks Service, as highlighted in SK Networks' Sustainability Report.
- Phased ESG performance evaluation and disclosure by each subsidiary (since 2022)