“Compassionate finance” has been the tagline for a key corporate philosophy of Shinhan Financial Group lately.

Shinhan Financial chairman Han Dong-woo presented what the nation’s third-largest financial group has been doing for “compassionate finance” at the 2012 Dow Jones Sustainability Index international conference early this month at Seoul’s Shilla Hotel.

Shinhan Financial’s “compassionate finance” was chosen as the most leading example of “creating shared value” among Korean companies.

The annual DJSI international conference is hosted by the world’s largest financial information company Dow Jones of the U.S., a Zurich-based international investment company with a specific focus on sustainability investments called SAM and the Korea Productivity Center. 

Chief executives of leading firms, industrial experts and investors participated in this year’s conference, held under the theme “Corporate Reputation and Financial Return.”

In recognition of the limits of social contributions that are far-fetched from the company’s regular trade, Shinhan Financial said it devised an idea that combines the scientific evaluation of the West and sincere hearts based on an Eastern way of thinking.

Regardless of the size and frequency of a company’s social contributions, if the contributions are not directly linked to what the firm actually does, society often does not take their goodwill seriously or as a lasting value.

Despite being one of the most generous banks in social contribution, Shinhan found social contributions unrelated to banking not enough to convey its goodwill.

It therefore came up with “compassionate finance,” a new management agenda that regards customers as partners for coexistence and cares for the underprivileged in what it does ― banking.

In spite of skepticism held by some over how serious Shinhan is about its new agenda, the group said it believes “compassionate finance” will be a zeitgeist of Korean society.

Shinhan’s corporate culture so far was focused on seeking growth and profits, but the new agenda is expected to shift the focus to sustainability.

“The real change for Shinhan begins now,” Han said in his closing comments at the conference.

“We will make consistent efforts to make ‘compassionate finance’ Shinhan’s DNA to fulfill both our business and social values.”

Shinhan has topped the annual DJSI evaluation for Korean banks for four years in a row.

It also received the honor of becoming one of the top 20 percent companies in the annual DJSI Asia Pacific survey for four consecutive years.

The Dow Jones Sustainability Korea Index is a corporate assessment method developed by Down Jones and SAM.

The firms’ financial performance as well as progress in dealing with risks deriving from environmental, economic (governance, management of suppliers) and social (social contributions, stakeholder engagement) developments are taken into account for the evaluation of 2,500 companies worldwide which started in 1999.

By Kim So-hyun (sophie@heraldcorp.com)