Reaching far and wide
When a financial crisis dealt a substantial blow to Korea’s economy 3 years ago, businesses and consumers shrank as banks feared losses.
Soon after it appeared that small and medium companies were hit the hardest; some did not survive while others, desperately looking for a last resort, were driven to take shelter at an equally dangerous or losing game, private loans with high interest, with no other option in sight (this cash-strapped group accounted for over 96 % of all businesses in Korea) which, everyone knew then, never boded well for future economy. Then came a silver lining.
Since 2005, Chairman Park, Hae-chin has led Gyeonggi Credit Guarantee Foundation (GCGF). He recalls, “We, as a savior for business people who were struggling, did not tighten our belt despite many risks. On the contrary, the foundation reached out extensively and directly.“
GCGF aims to offer credit guarantee programs to all types of small–to-medium and unregistered enterprises. Last month, GCGF received the Presidential Award of the best organization for “Business Support” at the 24th National Venture Competition, the first time for business support agency.
He continues, “How everything worked is very similar to how different gears work as a perfect mechanism; after I took charge in 2005, GCGF simplified an application, added 9 dispatch agencies and 14 new local offices to the mere 5 which previously existed. The organization’s contribution has increased up to USD 538 million from USD 190 million since then. All of these eventually resulted in creating more jobs and stabilizing economy in Gyeonggi province.“
When the crisis went viral in 2009, GCGF focused on lessening pressure on average people and was ready and effective in putting preparations into good use.
Park says, “In 2009, we loosened up more in an effort to assist mom-and-pop businesses, and at the same time rolled up our sleeves to work in the field to pay personal attention to each of them, because I was interested in lending a hand to especially those who are financially isolated without any voice. That year, GCGF made a bold decision by guaranteeing up to nearly USD 1.7 billion for 86,000 companies.”
Over the past 3 years, GCGF recorded a total amount of guaranteed funds of USD 2.3 billion for around 170,000 businesses, which is each 2.4 times and 1.8 times larger than that of the past 13 years combined before the crisis hit in 2009 (about USD 1 billion and 100,000 companies more).
In particular, up until last year, GCGF worked on the frontline for “social safety net” in Korea by backing up unregistered and store-less businesses that had been disqualified for the credit support (around 50,000 businesses and USD 590 million). In addition, as of June 11, the organization became the first initiative to reach 316,870 businesses and over USD 10 billion in support in 16 years among provincial credit guarantee foundations, vitalizing and stabilizing a local economy in Gyeonggi area.
In January, 2010, President Lee Myung-bak recognized its achievements and wrote a personal letter to Chairman Park. In the letter, the President praised his efforts, “During the crisis, GCGF provided an immense contribution towards overcoming it. What your foundation offered was not only money, but ‘ hope’.”
GCGF Chairman’s Personal Beliefs
When asked about the moment he felt most proud, he smiled, “Among many cases, it happened one day. A man came and told us about his company which was under heavy financial stress. We helped him with a guarantee worth of USD 49,000. Later he donated the same amount to GCGF when his company finally rebounded with success.”
Upon his management philosophy, “I believe that, whether they are public organizations or financial institutions, management must center on people. With this in mind, everything will find its place when the time comes. In other words, things will not fall apart but come together to provide solutions against troubles. For example, GCGF with the customer in mind was busy covering debts extensively when others were busy cutting off employees and spending. Of course, belt-tightening sometimes is called for, but we GCGF knew that all necessary measures were in place and led to synergy effects in reviving economy during the crisis.”
The 1st Proud Nonghyup-In
Last year, GCGF’s Director won “the 1st Proud Nonghyup-in“at the 50th anniversary celebration of his previous organization Nonghyup. The prestigious prize is awarded to a single individual who has been praised for his prominent past achievements and deserves respect from all of Nonghyup employees. Chairman Park was recommended and selected out of 300,000 candidates by his colleagues. He is grateful, saying ”It truly means something more glorious than any other title, because my junior colleagues are involved.”
The financial group founded in 1961 has been promoting the welfare of farmers and developing local communities. “During my tenure as secretary-general of Nonghyup headquarters in Gyeonggi, the bank held the number one position for 4 years in a row in annual management evaluation contests. What happened Well, every day I never skipped visiting a report room and a daily briefing, not to mention that I kept coming up with new ideas and spared no efforts to provide better management.” During Korea’s foreign currency crisis, his employee-centered leadership worked and generated profit when various risks were prevalent. “It is in my nature; I cannot help but care a lot about my people with attention and infatuation. I never regret or punish any of them as long as their mistakes or misdeeds do not cross the line.”
His own successful management passed from one organization to the other; GCGF has been sitting at No.1 for 6 years since 2007 in management evaluations on public institutions under the Gyeonggi provincial government. He says, “This time, everything revolves around “team work”, and I always highlight the importance of it before our employees. However, without passion for what we are doing, we cannot succeed, as customers will be far more impressed if they find such passion in our service. “Certainly, Chairman Park is as passionate now as he was at Nonghyup.
He is always on the lookout for the most ideal candidate, “Who is ready to dedicate his passion and hard work to his prospective group. Next are his personality, positive attitude, ethics, and so on. From which university he graduates or how smart he is does not interest me.”
Chairman Park concludes the interview with a hopeful message for the struggle in Gyeonggi-do, “First, I deeply thank small and medium companies for their adventurous mind and respectable entrepreneurship. Based upon their sweat, Korea has been able to compete shoulder-to-shoulder with other advanced countries. These days, everyone says ‘economy is getting worse, and businesses are failing.’ But Korea has come out strong every time a major economic setback has struck in the past. If business people do not give in, but keep moving forward with hope, there surely will be a way for them, and GCGF is always here to support them behind. “