Chairman Choi Jeong-woo of POSCO explains to writer Lee Yi-nam at a ceremony to unveil the Chapter of Corporate Citizenship at POSCO Center in Seoul on July 28. (Photo: POSCO)

Chairman Choi Jeong-woo of POSCO, marking two years in office, is accelerating efforts to secure new growth engines for the group.

Despite the sagging steel business caused by the spread of COVID-19, POSCO is diversifying its business portfolio to secondary battery materials, energy and logistics under the stewardship of Chairman Choi, to overcome a crisis.

POSCO aims to become a company respected in society by devoting itself to putting into practice its new management tenet of corporate citizenship.

Chairman Choi celebrated the 2nd anniversary of his inauguration on July 27.

Choi is evaluated to have established the groundwork to secure future growth engines by diversifying its business portfolio to businesses other than steel.

Choi announced 100 reform tasks since he took office and he has been devoting himself in diversifying business portfolio.

His strategy is that given the rapidly changing industrial structure, caused by the 4th Industrial Revolution, depending only on steel business cannot guarantee the future of the group.

The chairman has focused on EV batteries, dubbed “2nd Semiconductor.” He merged POSCO Chemtech, a subsidiary specializing in anode material for secondary battery, and POSCO ESM, a cathode material maker, and renamed the merged entity as POSCO Chemical after he took office.

The move may be construed as POSCO’s decision to ramp up specialization in the secondary battery business.

Under the stewardship of Chairman Choi, POSCO Chemical has been getting aggressive with facility expansion.

POSCO Group aims to nurture anode materials and cathode materials into the group’s representative material with the goal of taking a 20 percent market share and posting 17 trillion won in sales by 2030. The figure is more than half of the sales POSCO’s steel business achieved last year.

POSCO Group has strengthened its presence in the energy business.

The liquefied natural gas and trading business has been transferred to POSCO International, while POSCO Energy has taken over the operation of the LNG terminals.

POSCO has taken over a combined power plant using by-product gases at steelworks from POSCO Energy to establish a regime ranging from LNG production to power generation.

POSCO Energy plans to expand Korean and overseas gas infrastructure.

POSCO Group has established an integrated logistics entity to absorb all logistics functions, scattered among subsidiaries, in order to enhance efficiency.

In accordance with the group’s business diversification strategy, the portion of the steel business in a consolidated financial statement is expected to drop to a range of 30 percent this year. The group plans to secure a competitive edge by focusing on the selling of value-added products.

Chairman Choi, POSCO’s first chief financial officer-turned CEO, has beefed up financial fundamentals. He has concentrated on efforts to secure liquidity in advance to brace for a protracted recession and enhance unit price competitiveness.

POSCO has seen cash and cashable assets increase about 1 trillion won from 3.514.9 trillion won as of the end of 2019.

Chairman Choi is endeavoring to put into practice management tenets. On July 28, POSCO announced “Corporate Citizenship Guide,” designed to demonstrate its determination to be a sustainable company for 100 years.