21 Organizations Including Gamjeongwon, Dogong, and LH Rated 'Excellent' in Management Performance... Multiple Warnings for Below Satisfactory (Comprehensive)

Hong Nam-ki Deputy Prime Minister "Public Institutions Must Be Especially Wary of Wasteful Management"
Korea Railroad Corporation, Korea Coal Corporation, etc. Are Below Expectations... Heads of Institutions Warned

[Sejong=Asia Economy Reporter Kim Hyun-jung] Twenty-one public institutions, including Korea Appraisal Board, Korea Expressway Corporation, and Korea Land and Housing Corporation (LH), received an 'Excellent' rating in last year's management performance evaluation. On the other hand, the Post Office Logistics Support Group was the only institution to receive the lowest rating of 'Very Poor,' and 17 institutions including Korea Railroad Corporation, Korea Coal Corporation, and SR received 'Below Poor,' with most heads of institutions receiving mass warnings.

On the 19th, the Ministry of Economy and Finance held a Public Institution Management Committee meeting chaired by Deputy Prime Minister and Minister of Economy and Finance Hong Nam-ki to review and approve the '2019 Public Institution Management Performance Evaluation Results and Follow-up Measures.'

According to the evaluation results, a panel of private experts including professors, accountants, and lawyers conducted document reviews and on-site inspections of 129 public enterprises and quasi-governmental institutions from March, awarding 21 institutions (16.3%) an 'Excellent' rating. Notably, this year, due to the impact of the novel coronavirus disease (COVID-19), on-site inspections were conducted remotely via video conferencing.

Among the 129 public enterprises and quasi-governmental institutions evaluated, 51 institutions (39.5%) received a 'Good' rating, and 40 institutions (31.0%) received an 'Average' rating. 'Poor' and 'Very Poor' ratings were given to 16 institutions (12.4%) and 1 institution (0.8%), respectively.

Among public enterprises, those receiving an 'Excellent' rating included Korea Appraisal Board, Korea South-East Power Co., Korea Expressway Corporation, Korea Hydro & Nuclear Power, Korea Minting and Security Printing Corporation, and LH, totaling six institutions. Among quasi-governmental institutions, ten institutions including Health Insurance Review & Assessment Service, National Health Insurance Service, Korea Trade-Investment Promotion Agency, Korea Deposit Insurance Corporation, Small and Medium Business Corporation, Korea Tourism Organization, Korea International Cooperation Agency, Korea Energy Agency, Korea Housing Finance Corporation, and Korea Rail Network Authority also received the same rating. Among small and medium-sized institutions with fewer than 300 employees, five institutions including Korea Agricultural Technology Commercialization Foundation, Korea Mine Reclamation Corporation, Korea Institute for Advancement of Technology, Korea Food Safety Management Certification Authority, and Korea Forestry Promotion Institute received the same evaluation.

Conversely, public enterprises receiving a 'Poor' rating included Korea Coal Corporation, SR, and Korea Railroad Corporation. Six quasi-governmental institutions including Korea Veterans Health Service, Korea Industrial Complex Corporation, Human Resources Development Service of Korea, Korea Elevator Safety Agency, Korea Infrastructure Safety Corporation, and Korea Power Exchange, as well as seven small and medium-sized institutions including Korea Childcare Promotion Institute, also received a 'Poor' rating. The Post Office Logistics Support Group was the only institution among the evaluated entities to receive a 'Very Poor' rating.

By type, the distribution ratio of public enterprises and quasi-governmental institutions rated 'Good' or higher was 55.6% and 62.0%, respectively, whereas 'Poor' or lower ratings were distributed at 14.0% for quasi-governmental institutions and 16.3% for small and medium-sized institutions.

Evaluations were also conducted on the standing auditors of 62 institutions, with 11 institutions (17.7%) receiving an 'Excellent' rating. The distribution was 29 institutions (46.8%) rated 'Good,' 16 institutions (25.8%) rated 'Average,' and 6 institutions (9.7%) rated 'Poor.'

As follow-up measures based on the evaluation results, the Public Institution Management Committee will promote personnel actions, management improvement plans, and performance bonus payments. The head of the Post Office Logistics Support Group met the criteria for dismissal recommendation but has already been dismissed. Among 17 underperforming institutions, 15 heads with a tenure of six months or more received warning measures.

The head of Korea Railroad Corporation, where a customer satisfaction survey incident occurred, was subject to a warning and related personnel actions were requested. Among 11 institutions where serious accidents occurred, nine heads with a tenure of six months or more were also warned. The auditor of Korea Scholarship Foundation, one of the six institutions rated 'Poor' with a tenure of six months or more, was also warned.

Additionally, for the 17 institutions rated 'Poor' or below, measures will be prepared to reflect budget adjustments such as next year's operating expenses. Conversely, for the 127 institutions rated 'Average' or above, performance bonuses will be paid differentially by categorizing them based on relative and absolute ratings divided in half.

Separately, the Public Institution Management Committee decided to recommend voluntary return of at least 10% of performance bonuses (15% or more for financial-type institutions) by all executives including heads, auditors, and standing directors in relation to COVID-19. Those who have already returned bonuses may exclude the returned amount from further returns.

The Ministry of Economy and Finance explained that this evaluation "maintained a social value-centered evaluation policy while strictly assessing ethical management areas such as safety and manipulation of customer satisfaction surveys," and "focused on checking tangible results for the public by major projects and reflected contributions to innovative growth and economic revitalization." The Ministry plans to report the finalized 2019 management evaluation results approved by the Public Institution Management Committee to the National Assembly and the President in the future.

Deputy Prime Minister Hong Nam-ki emphasized the need for public institutions to take the lead in relation to this management evaluation and warned against lax management. He stated, "Compared to the public, small business owners, self-employed, and companies currently facing management and employment crises, public institutions are stable workplaces with guaranteed employment from the public's perspective," and urged, "Public institutions should understand the difficulties of the public and our economy and take the lead in sharing pain and overcoming the crisis." He especially stressed, "We must be particularly cautious about laxity."

This content was produced with the assistance of AI translation services.