We must quickly push forward innovations to break away from past success formulas 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, declaring a "major shift in management policy toward qualitative growth," and said this. To that end, Shin stressed that indicators should be managed with a focus on profitability, corporate value should be raised, and a foundation for sustainable growth should 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 each in the first and second half. About 80 people, including the representative director and Deputy Minister of LOTTE Corporation and heads of affiliates, attended the VCM that day. Shin Yoo-yeol, executive vice president and Shin's eldest son, who serves as a co-CEO of Lotte Biologics, also attended. Shin has been appearing at the VCM since 2023.
Starting around 1 p.m. on the 15th, black corporate vehicles arrived one after another at the entrances of Lotte World Tower. Executives from Lotte affiliates who stepped out of the vehicles headed to the meeting room with resolute expressions, holding back words in response to reporters' questions.
The meeting, which began at 2 p.m., proceeded throughout in a heavy atmosphere. Shin expressed concern about the group's recently slowed growth and the imbalance in its business portfolio and predicted that this year's business environment would not be favorable. He emphasized that strengthening business competitiveness must come first to overcome the difficult environment and enable the group to grow further.
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 tasked with enhancing core brand value; retail, with maximizing customer satisfaction through trade-area-tailored store strategies; and chemicals, with swift restructuring in line with government policy and upgrading the portfolio centered on specialties. They also discussed building a rigorous risk management framework to prevent information security and safety incidents in advance.
To resolve the priority tasks discussed, Shin presented management policies that must be executed: ▲ a shift to profitability-based management ▲ swift and proactive decision-making ▲ wariness of arrogance and focus on the essence of the business.
Shin called for a shift to profitability-focused management for qualitative growth. He urged the group to solidify its fundamentals by making ROIC (Return on Invested Capital) the principle, focusing on strengthening profitability and efficient investment rather than sales-driven top-line growth. ROIC, calculated by dividing after-tax operating profit by invested capital, is a key profitability indicator that shows how efficiently corporations generate profit from the capital invested in business activities.
Shin also emphasized executing investments under clear principles and standards and continuously reviewing the validity and adjusting details even for projects already underway.
He also called for swift and proactive decision-making following adjustments to the group's governance. In executive appointments last year for 2026, Lotte abolished the HQ system and strengthened affiliates' accountable management to build leadership focused on rapid change management and execution. Shin urged CEOs that day to contemplate both the company's mid- to long-term vision and resolving current issues, and to foster an organizational culture where employees can innovate and grow autonomously.
Shin repeatedly warned against the arrogance of thinking "we are different," trapped in past success experiences. He also urged a focus on the essence of the business, defining innovation as continuously improving products and services to meet customer demand.
Shin concluded the meeting by saying, "If we do not change without parting with what is familiar, we cannot solve the problems we face now," and urged, "We must quickly pursue innovations to break away from past success formulas and strengthen our fundamental competitiveness."
Meanwhile, before the VCM that day, Shin and the representative director and Deputy Minister of LOTTE Corporation laid flowers and observed a moment of silence at the bust of Lotte founder Shin Kyuk-ho set up on the first floor of Lotte World Tower, commemorating the sixth anniversary of his death (Jan. 19, 2020). The attendees reaffirmed their determination to overcome the current challenges by reflecting on the founder's spirit of challenge and management philosophy, which found opportunities amid crises and grew the group.