‘Tesco supermarkets create more jobs than mom-and-pop stores’

Lee Seung-han Home plus Chairman

Lawmakers have recently attempted to regulate discount chains’ efforts to set up convenience stores in city centers as well as residential areas in the name of protecting mom-and-pop stores and ordinary people.

However, Home plus Chairman Lee Seung-han said in a recent interview with The Korea Times that its neighborhood Home plus Express supermarkets are of much greater assistance to people.

His rationale: the stores generate far more jobs and help tackle inflationary pressures that have been a big headache here over the past year.

“Instead of hiring a couple of workers as is the case at a typical mom-and-pop outlet, a Home plus Express stores need 10 to 20 employees on three shifts including those in charge of supply chain management,” Lee said.

“In addition, we have learned that their presence prods nearby big stores to cut prices of goods on their shelves because we offer various items at lower prices.”

Based on the belief that Home plus Express doesn’t damage the economy but boosts it by increasing jobs and curbing price hikes, Lee is against the recent regulations that limit the activities of the supermarkets belonging to big retailers.

Last year, the National Assembly introduced a law restricting the opening of stores operated by large retailers within a radius of 500 meters around a cluster of small shops.

Regional governments are set to urge major discount stores to close at least once or twice a month, which Lee worries will reduce Home plus sales by almost 10 percent.

Home plus is 100 percent owned by Tesco, the U.K.-based retail giant, but Lee said that does not mean it contributes to society less than Korean companies.

“Most Home plus executives including the chief executive officer are Koreans and we hire about 27,000 Koreans across the country,” said Lee who has led the Seoul-based entity since its foundation in 1999.

“We have never paid dividends to the shareholder and retained all the earnings so as to reinvest them in Korean ventures, which has helped the development of the economy and creation of jobs.”

The 65-year-old said that its social contribution is not limited to just economic aspects as amply demonstrated by its vehement efforts in the corporate social responsibility (CSR) programs.

“As soon as we started Home plus, one of our top priorities was CSR, and the installation of many convenient facilities on the first floor of our hypermarkets was in tandem with that philosophy,” Lee said.

“Back then, experts said that such a focus on CSR would hurt our bottom line. But all of our competitors copy our strategy now. I put the brand image and long-term profits on the front burner rather than short-term profitability.”

Lee said such an approach has been possible since he acts as if he has ownership of the company. Although the firm is wholly owned by Tesco he thinks and behaves under the mantra that he owns it.

Under such a mindset, the charismatic leader has kept staging various CSR activities and has led the Global Compact Korea Network, the Seoul bureau of the U.N. Global Compact.

“As far as corporate social activities are concerned, there seemingly is no global standard approach. We can take the initiative in establishing one on our own in the future,” he said. <Korea Times/Kim Tae-gyu>

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