Distribution Industry Embarks on Personnel Reform, Appoints Executives Born in the 1960s

Lotte to Advance Personnel Changes by End of Month, Emphasizing Young Talent Injection
Shinsegae Also Lowers Average Age of Half Its Subsidiary CEOs

Customers are leaving the Lotte Department Store Main Branch in Jung-gu, Seoul.
Photo by Mun Ho-nam munonam@

[Asia Economy Reporter Seungjin Lee] The retail industry, struggling with sluggish sales, is moving up the timing of personnel appointments. In addition to the impact of the novel coronavirus disease (COVID-19), the retail market is increasingly centered online, and the plan is to rebound through personnel renewal.

According to the retail industry on the 16th, Shin Dong-bin, chairman of Lotte Group who had been overseeing the Korea-Japan Lotte Group from Japan since August, will return to Korea around the 20th of next week. It is expected that Chairman Shin will carry out a large-scale personnel reshuffle at Lotte Group around the end of this month upon his return. Lotte Group has traditionally held regular personnel appointments in December every year. This means the timing is being moved up by nearly a month.

The situation is not good. The two main pillars of the group, Lotte Shopping and Lotte Chemical, saw their operating profits plummet by 98.5% and 90.5% respectively in the second quarter of this year, falling into serious stagnation. Some evaluations say this crisis is more severe than the THAAD (Terminal High Altitude Area Defense) incident.

Ultimately, in August, Lotte Holdings Vice Chairman Hwang Gak-gyu abruptly stepped down, declaring a generational change, and with the remaining personnel appointments completed within three months, there is speculation that a generational shift among key executives will take place.

In the unprecedented crisis of the COVID-19 pandemic, which has deepened the offline retail crisis, Lotte appears to be putting young and dynamic management at the forefront to seize new opportunities online. Across the retail industry, a rise of executives born in the 1960s is expected.

Lee Dong-woo, who was appointed CEO of Lotte Holdings in August as the successor to Vice Chairman Hwang, born in 1955, was born in 1960. Yoon Jong-min, president of Lotte Human Resources Development Institute, and Ryu Je-don, executive director and CEO of Lotte Property & Development, are also born in 1960. Since Chairman Shin has consistently emphasized digital transformation (DT), it is widely analyzed that the age of the working-level executives will be lowered to under their 40s.

The atmosphere of personnel renewal in the retail sector is also evident in the personnel reshuffle of Shinsegae Group carried out on the 15th. Shinsegae replaced the CEOs of 6 out of 11 major affiliates in the Emart division, more than half. The main points were strengthening online capabilities, creating synergy between online and offline, and establishing a new growth foundation through improving organizational efficiency.

All six CEOs appointed by Shinsegae were born in the 1960s. Kang Hee-seok, who will lead Shinsegae’s core affiliates Emart and SSG.com together, was born in 1969 and is 51 years old this year. The average age of the six newly appointed CEOs is 53 years old. This is interpreted as a will to respond quickly to industry changes by lowering the age of CEOs.

Emart has also moved to change the atmosphere by conducting early executive appointments this year following last year. Normally, Emart’s executive appointments are in December. However, last year, when Emart posted a quarterly deficit for the first time, the executive appointments were moved up to October. This year, the consolidated operating loss in the second quarter was 47.4 billion KRW.

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