[Asia Exclusive] Kim Soon-cheol, Secretary General of the Cooperation Foundation, "The 'Cooperative Profit Sharing System' Shone During the COVID Crisis"

Large and Small-Medium Enterprises Share Cooperation Profits from Win-Win Collaboration
Support Divided into 12 Types Including Rent and Sales Commission Reductions

Kim Soon-chul, Secretary General of the Foundation for Cooperation between Large, Small and Medium Enterprises and Agriculture and Fisheries, is being interviewed on the 20th at the Foundation for Cooperation between Large, Small and Medium Enterprises and Agriculture and Fisheries in Guro-gu, Seoul. Photo by Kang Jin-hyung aymsdream@

[Asia Economy Reporter Kim Heeyoon] The domain of the Foundation for Large, Small and Medium Enterprises and Agriculture-Fishery Cooperation is ‘Win-Win’. As the name suggests, ‘cooperation’ and ‘mutual growth’ are the foundation’s reason for existence and purpose. The Cooperation Foundation turned eighteen years old this year in Korean age.

When the unprecedented crisis of COVID-19 broke out, the foundation’s cooperation profit-sharing system shone. ‘Cooperation profit-sharing’ means that large and small-medium enterprises share the cooperation profits generated through win-win cooperation by carrying out projects together. They establish mutual standards in advance, agree on them, and then act according to that agreement.

In the COVID-19 crisis situation, the foundation subdivided tasks into 12 types to support small-medium enterprises and small business owners. Fifty-two organizations, including the Government Employees Pension Service and Korea Electric Power Corporation, reduced or waived rent for small-medium enterprises and small business owners struggling due to COVID-19. Many companies shared part of the total sales of products supplied to partner companies in cash (margin compensation), and other companies lowered sales commissions for partners participating in joint sales events. Some private companies supported the four major social insurance premiums for cooperating small-medium enterprises.

Korea Gas Corporation supported quality inspection costs for partner companies and reduced technology fees. Public enterprises also stepped up, such as interest rate reductions (Korea Technology Finance Corporation), review fee reductions (Korea Food Safety Management Certification Institute), delivery fee support (Korea Post Logistics Support Group), and agency fee reductions (Korea Electrical Safety Corporation). To ensure that such cooperation and mutual growth continue steadily, the foundation discovers methods and sometimes acts as a mediator.

Secretary-General Kim Sooncheol said, "We have registered and are operating 1,309 tasks in 12 categories to overcome and support COVID-19," adding, "We are continuously developing diverse cooperation profit-sharing tasks at the foundation level to help small-medium enterprises facing management crises."

Meanwhile, one type of cooperation profit-sharing system, the incentive type, shares cooperation profits in the form of incentives with partner companies that have worked together to achieve business performance. Although the system has not yet been legislated, the foundation explains that the number of companies using it has increased and that it is proving effective on the ground.

◇Career

▲Born in 1960 ▲Sunchang High School ▲Bachelor’s and Master’s degrees in Economics from Jeonbuk National University ▲Master’s degree from Seoul National University Graduate School of Public Administration ▲Ph.D. in Economics from the University of Missouri ▲27th Administrative Examination ▲Fair Trade Office, Economic Planning Board ▲Export Division Chief, Ministry of Trade, Industry and Energy ▲Deputy Administrator, Small and Medium Business Administration ▲President, Korea Credit Guarantee Fund ▲Secretary-General, Foundation for Large, Small and Medium Enterprises and Agriculture-Fishery Cooperation (current)

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