[E-Daily Marketin Reporter LEE GEON-EOM ] It has been confirmed that KOLON CORPORATION, the holding company of the KOLON Group, has established a “Management Committee” under its board of directors, composed solely of inside directors, to accelerate its response to operational issues across the entire company. KOLON CORPORATION(002020)Since the company, unlike its major affiliates, did not previously have a Management Committee, this move is interpreted as a strategy to handle major financial and legal decisions—such as fundraising and asset sales—more swiftly amid the rapidly changing financial environment.

According to a comprehensive report by E-Daily on the 14th, KOLON CORPORATION held a board of directors meeting on March 31 and established a new Management Committee as a subcommittee under the board. The Management Committee is a body authorized by the board of directors to directly deliberate on and vote on major agenda items—excluding matters requiring approval at the shareholders’ meeting or the appointment and dismissal of CEOs. In fact, the Management Committee immediately began operations on May 14 by directly approving two proposals for borrowing from financial institutions without convening the full board of directors.

Composed solely of three key executive directors who oversee KOLON CORPORATION’s company-wide management, legal affairs, and finance, the KOLON CORPORATION Management Committee will serve as a “fast track” for decision-making. For KOLON CORPORATION, which has carried out a series of large-scale fundraising initiatives—including the issuance of hybrid capital securities and private exchangeable bonds, as well as participation in capital increases by subsidiaries—this effectively establishes an efficient system that allows for timely responses based solely on the judgment of the internal leadership, bypassing the logistical procedures involved in coordinating the schedules of outside directors.

A closer look at the composition of the Management Committee reveals its strong expertise. Chairman Ahn Byung-deok, CEO, is a management expert who has steered the group steadily through crises since joining KOLON CORPORATION in 1982, having served as CEO of major affiliates such as KolonGlobalCorporation and KOLON INDUSTRIES.

Joining him are Executive Vice President Yoo Byung-jin and Senior Vice President Han Woo-jun, who oversee the company’s legal and financial affairs, respectively, ensuring seamless risk management. Executive Vice President Yoo is a legal expert who served as a prosecutor at the Daejeon, Gwangju, and Incheon District Prosecutors’ Offices from 2006; since joining the group in 2013, he has steered the Ethics Management Office with stability.

Senior Manager Han, who was newly appointed as an inside director this past March, is a “finance expert” who has proven his practical capabilities by serving as Head of Management Support at KOLON CORPORATION and CEO of KOLON Auto; he currently serves as Chief Financial Officer (CFO) of the holding company.

The establishment of a Management Committee within the KOLON CORPORATION’s holding company is viewed as a move to further strengthen its role as a control tower for legal and financial affairs. Amid ongoing internal and external economic uncertainties, this has laid the groundwork for the holding company to respond more swiftly and flexibly to critical issues requiring a high degree of expertise, such as providing financial support to affiliates or reviewing investments.

In fact, while KOLON CORPORATION’s consolidated operating profit for the first quarter of this year improved year-over-year to 98.7 billion won, financial expenses—which included interest expenses and valuation losses on derivatives—rose to 142.6 billion won, more than doubling (104.8%) compared to the same period last year (69.6 billion won). Despite the operating profit, the growing burden of financial expenses led to a consolidated net loss of 44.7 billion won, underscoring the increasing importance of financial management.

A series of financial schedules, such as providing funds to subsidiaries, is also cited as a reason why swift decision-making is necessary. KOLON CORPORATION resolved to issue 60 billion won worth of private exchangeable bonds (EBs) in March and invested those funds in a capital increase at Kolon TissueGene, Inc. Given that the company raised 785.2 billion won in short-term borrowings in the first quarter alone—resulting in a cycle of borrowing and repayment—it is understood that a system was needed to streamline procedures, such as coordinating schedules with outside directors, and to enable timely decision-making led by internal management.

Regarding this, a KOLON CORPORATION official explained, “We established the committee to handle issues arising from the legal, corporate affairs, and finance departments more efficiently.”