Will the 'Union-Recommended Director System' Become Empty Promises?… KAMCO's Union-Recommended Outside Director Fails Again

[Asia Economy Reporter Song Seung-seop] President Moon Jae-in's campaign promise of the 'Labor Union-Recommended Director System' is expected to be virtually an empty promise. Even if the labor union recommends candidates, they are repeatedly rejected during the final decision-making process within financial public enterprises.

According to the financial sector on the 13th, Korea Asset Management Corporation (KAMCO) held a shareholders' meeting and appointed Lee Dong-yeol, former External Cooperation Officer of the Policy Planning Office of Busan Metropolitan City, as the new outside director. His term began on the 9th and will last until July 8, 2023.

The candidate originally recommended by the KAMCO labor union was nominated by the Executive Recommendation Committee (ERC) but was rejected at the shareholders' meeting. KAMCO's outside directors are selected through a process where the ERC reviews applicants and shortlists three times the final number, after which the shareholders' meeting elects the directors.

The appointment of labor union-recommended outside directors was also canceled in July-August last year. At that time, the labor union recommended a total of four candidates for outside director. The ERC nominated 15 candidates, including two from the labor union, for the shareholders' meeting. However, none were included among the five outside directors to be replaced.

The labor union is immediately showing opposition. They claim that despite reaching an agreement last year at the Economic, Social and Labor Council (ESLC) to prevent parachute appointments, the plan was still canceled.

The labor union-recommended director system was a campaign promise presented by President Moon to improve governance in public institutions and strengthen a responsible management system. After the current administration took office, it aimed to introduce this system in financial public enterprises to end controversies over parachute appointments, but it has been repeatedly canceled.

Previously, IBK Industrial Bank and Korea Eximbank also attempted to introduce the labor union-recommended director system, but it was canceled due to opposition from relevant ministries and shareholders.

On this day, the National Financial Industry Labor Union criticized, “The administration has once again responded to our earnest wishes and efforts with parachute appointments,” adding, “They have publicly declared their incompetence, helplessness, and lack of will to the whole world.”

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