SK is signing an agreement on mutual growth with partner companies and expanding its shared growth culture to second- and third-tier suppliers. SK said on Wednesday it held a signing ceremony at SKT Tower in Jung-gu, Seoul, for an agreement on mutual growth among SK and its first-, second- and third-tier partner companies, with seven affiliates and about 100 partner firms taking part.

Seven affiliates joined the agreement: SK Hynix, SK Telecom, SK Ecoplant, SK Geocentric, SK Siltron, SK Corp AX and SK Intelix. The agreement was arranged to strengthen the partnership between SK affiliates and their suppliers and to broaden the shared growth culture to second-tier and lower suppliers. It includes measures to improve payment terms, improve trading practices, and expand support for R&D and finance and funding.

SK decided to pay first-tier small and midsize partner companies within a maximum of 10 days after closing. It will also expand the share of cash payments, taking into account industry characteristics. SK will provide incentives to partners that use the shared growth payment system. Through the system, second- and third-tier suppliers can receive funds in separate escrow accounts earlier than before, easing funding burdens.

If first-tier suppliers ease payment conditions for second- and third-tier suppliers, they will receive additional points in evaluations for contract renewals and the selection of new partner firms. SK plans to check payment deadlines and methods for suppliers at each tier to establish a sound payment culture. It will also expand the beneficiaries of the group-wide shared growth fund, currently operated at 680 billion won, to include second- and third-tier suppliers, and run a tailored online training programme as well.

SK Hynix will inject 1.4 trillion won in new funds to strengthen the semiconductor ecosystem. It will operate an analysis and measurement support centre that helps partners develop new products and newly launch Trinity Fab, a testbed that verifies product reliability. It will also run an R&D challenge reward programme that provides technology development funding first and settles later based on results.

SK Telecom, SK Ecoplant, SK Geocentric and SK Siltron will also expand support for partner companies. SK Telecom has made early payments totaling 14.5 trillion won cumulatively over 22 years through its "Payment Right Away" service. The other three companies will support technology commercialisation, improvements in ESG and safety and environment, and wafer process training, respectively.

Choi Chang-won (최창원), chairman of the SK Supex Council, said, "SK has made efforts by regarding the growth and happiness of partner companies, which are key stakeholders, as an important value." He added, "I think today's SK exists based on government support for this and the active participation of partner companies." Choi said, "We will actively put into practice mutual growth measures that partner companies can feel in a practical way and work so that the shared growth culture spreads across the entire industry."