Popular Culture Column ESG Management and K-Pop

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Hive is acquiring a world-class entertainment company and is producing audition programs with local North American companies. The cases in which our entertainment agencies, including SM, launch idol groups with local companies in the US are similar to those of the past. Park Jin-young, the head of JYP, was also selected as the ideal boss in Japan. This is because they have achieved great success by setting and launching Niju.

It can be said that these things are possible because the status of K-pop has risen that much. In the early 2000s, even when K-pop was gaining popularity abroad, mainly idols, there were more criticisms than favorable reviews. K-pop, which was well received in Asia, did not get good reviews, especially in North America and Europe, due to the flaws in the business model of entertainment agencies. In particular, the singer’s singing ability was low, and the artistry could not be mentioned. But now, many idols have the singing ability and freely write lyrics, compose, and produce. I no longer ask them for artistry.

The governance structure of the agencies was unclear. The word that condensed it is ‘slave contract.’ It was notorious for saying that unreasonable contracts for an extended period were exploitative. Sexually exploitative behaviors were also defined as frequent occurrences. Sooner or later, we had to aim for social values ​​, including human rights.

Now, K-Pop represents the plight of the world’s young people, speaks out against racism, and joins the anti-dictatorship protests. Indeed, it is striving to realize the values ​​of world democracy and human rights. Even if they do not move under the banner of a grand ideology, they provide financial support to people in disadvantaged situations.

Governance should also be fair and transparent. Even the fans demand fairness. If a popular group is abused with the love and support of its fans, it immediately causes a considerable backlash from fans and a boycott. As you can see from the production situation, it has become impossible to form an idol through score manipulation in conjunction with a broadcasting company. Actively participate in environmental issues. Fan clubs and artists are working hard to combat climate change. Donate to help those suffering from floods and droughts.

Recently, ESG (Environmental and Social Governance) management can be seen as a global topic, and in that regard, K-Pop may have made some progress. Sooner or later, ordinary companies must learn from K-Pop. This is because the betrayal of interest by companies that promoted eco-friendly management or emphasized such products is causing controversy and conflict. This is a so-called greenwashing phenomenon. However, K-pop should also consider this greenwashing problem.

In the case of 4th generation idols, they start based on the success rules of 3rd generation idols from the beginning. Of course, that doesn’t guarantee success. This is especially true if it is used as a marketing strategy. The sincerity, not the technique, must come first, and the universal principles and values ​​must be fully realized by oneself. Recently, metaverse has become very popular, and we are pursuing a strategy to link or converge it with the fan community business. It was thought of as simply an entertainment agency, but as it gradually turns into a platform company, one side is sending concerns between surprise and anticipation.

In some cases, mergers and acquisitions or advances for stock prices are on the rise. Even if it follows Google’s precedent, if it is an event to drive the stock price, it may be at odds with ESG management. It is unknown whether the fans want a K-pop agency to become a global platform company like Amazon. It is necessary to reflect on whether the sincerity of the fans is being quantified and quantified at some point through the size of the profit.

Building a foundation that will not collapse at any moment is the way out of the Hong Kong case.

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