EY Hanyoung "In an Era of Extreme Uncertainty, Securing Resilience is Necessary"

New Year Economic Outlook Online Seminar
"Predicting Crises to Minimize Damage and Secure Profitability"

Global accounting and consulting firm EY Hanyoung held a New Year economic outlook seminar on the 31st under the theme "Securing Resilience in an Era of Hyper-Uncertainty." The seminar, conducted online, was attended by executives from major domestic companies and figures from the economic sector. The topic emphasized that companies must secure resilience to respond to changes in the global economic and financial environment.

Park Yong-geun, CEO of EY Hanyoung, stated in his opening remarks, "EY Hanyoung has held a New Year economic outlook seminar every year to review domestic and international economic trends and provide solutions and strategies to companies. This year marks the 10th anniversary." He also pointed out that while companies have traditionally addressed problems by reacting after facing crises, to cope with increasing uncertainty and volatility, they must develop resilience to predict crises, minimize damage, and secure growth and profitability.

Former Chairman Ko Seung-beom, who delivered the keynote speech, forecasted that global economic uncertainty will increase due to the slowdown in growth among advanced countries and changes in economic policies. The domestic economy is expected to experience a moderate recovery in the first half of the year due to expectations of easing domestic and foreign interest rates and improvements in the manufacturing sector, but external risks in the second half suggest a "high first half, low second half" economic trend.

Former Chairman Ko said, "The world is caught in a dilemma between debt accumulation caused by the pandemic and stimulus policies for growth. Elections are taking place in many countries, including the United States and the European Union, increasing uncertainty." He added, "The domestic economy is expected to grow in the low 2% range in the first half due to export recovery, but growth is likely to slightly decline in the second half due to base effects and the slowdown of the U.S. economy."

He predicted that conflicts between camps will intensify as artificial intelligence (AI) expands its industrial influence and decarbonization policies are fully implemented, emphasizing that corporate responses are crucial amid such turmoil. Furthermore, he stressed, "Domestic companies must secure resilience against uncertainty through giryakjonghwang (機略縱橫) and establish and execute flexible strategies according to circumstances." Giryakjonghwang means "freely employing a flawless strategy capable of responding to any change."

Following him, Byun Jun-young, Director of EY Hanyoung Industrial Research Institute, identified four key characteristics of resilient companies: ▲proactive optimization of business portfolios ▲discovery and investment in next-generation growth engines ▲bold modification of operating systems and response to market changes ▲establishment of systems to systematically respond to various crises. He stated, "The global business environment has entered an era of hyper-uncertainty, driven by diverse and highly disruptive factors such as geopolitical risks, digital technology innovation, cybersecurity, human resource management, and environmental concerns. Companies that have secured resilience demonstrate differentiated performance, achieving results about four times higher than those that have not."

Kim Su-yeon, EY Consulting Partner and AI Leader, introduced specific measures and cases for companies to secure resilience. Kim cited ▲corporate spin-offs and divestitures ▲building supply chain management (SCM) with resilience ▲AI-based operations ▲investment in future businesses as concrete ways to secure corporate resilience. "Simply adopting new technologies and tools does not guarantee that a company can secure resilience," she said. "As markets change rapidly, it is essential to select key tasks considering industry characteristics and situations, and combine personnel and organizations with diverse project experience and expertise to build a structure capable of proactive crisis response." Kim added.

This content was produced with the assistance of AI translation services.