'Muk-twi Controversy' Kakao's Ryu Young-jun Resigns... Kim Beom-su Faces Deepening Dilemma

[Asia Economy Reporter Kang Nahum] With Ryu Young-jun, the co-CEO nominee of Kakao, announcing his intention to resign on the 10th, Kim Beom-su, chairman of Kakao's board, also finds himself in a troublesome situation. This comes as Chairman Kim's plan for Kakao's global leap through leadership restructuring has been disrupted. Recovering the brand image, which was damaged after the split listing and executives selling their shares, remains a challenge for Chairman Kim.

On the 10th, Kakao announced through a public disclosure, "Ryu Young-jun, the nominee for the new CEO, has expressed his intention to voluntarily resign. The Kakao board has comprehensively considered the opinions received from the crew (employees) through various channels and decided to accept this decision."

Ryu was nominated as the next co-CEO along with Yeo Min-soo after CEO Cho Soo-yong announced on November 25 last year that he would not seek reappointment. He joined Kakao as a developer in 2011, led the development of Voice Talk, and contributed to establishing the simple payment service Kakao Pay in the market. He was also evaluated as the right person for Kakao's global leap by successfully leading Kakao Pay's IPO.

However, controversy arose when Ryu sold shares of Kakao Pay, where he serves as CEO, through a block deal (off-hours large-volume trading) on December 10 last year, earning a profit of 46.9 billion KRW, leading to accusations of 'eat-and-run.' Kakao's labor union and employees demanded Ryu's resignation.

With Ryu expressing his intention to resign on this day, Chairman Kim, who aimed to overcome negative issues surrounding the company such as sprawling expansion through 'young leadership,' is also in a difficult position. The new leadership he had appointed was shipwrecked before even setting sail, and the 'Kakao' brand faces criticism for the split listing followed by executives selling their shares.

To manage the situation, Chairman Kim and the board are expected to immediately begin the process of appointing a new CEO. However, given the tight schedule for Kakao to appoint another co-CEO before the shareholders' meeting in March, the possibility of Yeo Min-soo serving as the sole CEO is also being considered.

Kakao stated, "We will make our best efforts to enhance shareholder value and restore trust among employees," adding, "We will hold internal discussions and procedures regarding the new leadership and will re-announce once finalized."

Meanwhile, Kakao's labor union released a statement regarding Ryu's resignation, calling it a "natural decision." The union said, "We positively evaluate that the legitimate demands of the members were discussed and accepted," and added, "We plan to focus on healing the internal wounds suffered by employees due to this incident."

Furthermore, to prevent recurrence of the 'eat-and-run' controversy, the union plans to demand the company implement measures such as ▲ establishing regulations restricting executives from selling shares for a certain period after listing ▲ strengthening internal inspection procedures to reinforce the duty of care of good managers.

Seo Seung-wook, head of Kakao's labor union branch, said, "Kakao Pay members have worked silently and endured despite exceeding legal working hours and not properly receiving overtime pay under the comprehensive wage system, all for the company's growth," adding, "The sense of loss felt by the members due to this incident is so deep that I dare not fully comprehend it."

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