We must quickly push innovation to break away from past formulas for success and strengthen our fundamental competitiveness.
Shin Dong-bin, chairman of Lotte, presided over the first-half 2026 VCM (Value Creation Meeting; formerly the presidents' meeting) at Lotte World Tower in Jamsil, Seoul, on the 15th and declared a "major shift in management policy toward qualitative growth," saying the above. To that end, Shin stressed that indicators must be managed with a focus on profitability, corporate value must be raised, and a foundation for sustainable growth must be laid.
The VCM is a meeting where all Lotte affiliates gather to share the group's mid- to long-term goals and strategies. It is held once in the first half and once in the second half. About 80 people, including the CEO and Deputy Minister of LOTTE Corporation and the heads of affiliates, attended the VCM that day. Shin Yoo-yeol, Shin's eldest son and a co-CEO of Lotte Biologics, also attended. Shin has been appearing at the VCM since 2023.
From around 1 p.m. on the 15th, black corporate vehicles arrived one after another at the Lotte World Tower entrance. Executives from Lotte affiliates who got out of the vehicles headed to the meeting room with resolute expressions while keeping their answers brief to questions from reporters.
The meeting, which began at 2 p.m., proceeded in a consistently somber mood. Shin expressed concern about the group's recently slowing growth and imbalances in its business portfolio and projected that this year's business environment would not be favorable. He emphasized that, to overcome the tough environment and for the group to grow further, strengthening business competitiveness must come first.
CEOs of each affiliate held in-depth discussions on strategy rebalancing by business group to strengthen business competitiveness. As priority tasks by business, food was assigned to enhance core brand value; retail to maximize customer satisfaction through trade area-specific store strategies; and chemicals to conduct swift restructuring in line with government policy and to advance a specialty-centered portfolio. They also discussed building a stringent risk management framework to preempt information security and safety accidents.
To address the priority tasks discussed, Shin presented management policies that must be executed: ▲ a shift to profitability-based management ▲ swift and agile decision-making ▲ vigilance against arrogance and focus on the essence of the business.
Shin called for a shift to profitability-centered management for qualitative growth. He urged solidifying fundamentals by adopting ROIC (Return on Invested Capital) as a principle, centered on strengthening profitability and efficient investment rather than on the traditional sales-driven top-line growth. ROIC, calculated by dividing after-tax operating profit by invested capital, is a key profitability metric that shows how efficiently corporations generate profit from the capital invested in operations.
Shin also emphasized that investments should be executed under clear principles and standards, and that even for businesses already under investment, feasibility should be continuously reviewed and details adjusted.
He also called for swift and agile decision-making through group governance adjustments. In last year's 2026 executive appointments, Lotte abolished the HQ system and strengthened affiliates' accountable management to build leadership focused on rapid change management and execution. Shin urged CEOs to consider their company's mid- to long-term vision and the resolution of pressing issues at the same time, and to foster an organizational culture where employees can autonomously innovate and grow.
Shin reiterated that they must guard against the arrogance of thinking they are different, trapped by past successes. He also asked that they focus on the essence of the business, defining innovation as the continued improvement of products and services to meet customer demand.
Shin concluded the meeting by saying, "If we do not change without parting from what is familiar, we cannot solve the problems we are experiencing now," and, "We must quickly push innovation to break away from past formulas for success and strengthen our fundamental competitiveness."
Meanwhile, before the VCM that day, Shin, along with the CEO and Deputy Minister of LOTTE Corporation, laid flowers and observed a moment of silence at the bust of founder Shin Kyuk-ho on the first floor of Lotte World Tower to mark the 6th anniversary of his passing (Jan. 19, 2020). The attendees reaffirmed their resolve to overcome the current difficulties by reflecting on the founder's spirit of challenge and management philosophy, which found opportunities amid crises and grew the group.