Woori Financial to Begin Management Succession Process for Next Chairman in November?

ECRC to Launch Four Months Before Term Expiry
Management Succession Process Expected to Begin in Late November

Panoramic View of Woori Financial Group.

Woori Financial Group is expected to begin the process of selecting its next chairman as early as next month.

According to the financial industry on October 27, the board of directors of Woori Financial Group is expected to activate the Executive Candidate Recommendation Committee (ECRC) in November to select candidates for the next chairman.

A financial industry official stated, "Woori Financial Group has a principle of starting the selection process at least four months before the CEO's term expires to ensure a stable management succession," adding, "Since Lee Chanjin, Governor of the Financial Supervisory Service, has mentioned the issue of selecting the chairman of a financial group, it is highly likely that the board will also discuss this matter."

In November last year, Woori Financial Group revised its management succession regulations. While financial authorities recommend starting the process three months before the chairman's term expires, Woori Financial Group moved this up to four months. In February this year, the company also announced an internal control innovation plan and expanded its standing candidate pool to 15 people. These measures aim to ensure transparent and fair management succession.

The term of Chairman Lim Jongryong of Woori Financial Group expires in March next year. Considering this, Woori Financial Group must convene the ECRC by the end of November. After selecting the pool of chairman candidates, the ECRC conducts step-by-step interviews and verifications for at least two months. Candidates are shortlisted through reputation checks and competency evaluations, and the final candidate is determined through in-depth interviews with external experts and a management plan presentation. The board of directors finalizes the candidate recommended by the ECRC and submits the matter to the general shareholders' meeting.

Both inside and outside Woori Financial Group, there is a prevailing view that Chairman Lim is highly likely to be reappointed. Since taking office, he has led the launch of Woori Investment & Securities and completed the acquisition of Dongyang Life Insurance and ABL Life Insurance, thereby fulfilling Woori Financial Group's long-standing goal of establishing a "comprehensive financial group" system.

However, external variables remain. Woori Financial Group has frequently been influenced by political and governmental intervention in the past, raising concerns that the management succession process could again be affected by outside forces.

Woori Bank was established in 1998, immediately after the foreign exchange crisis, through the merger of Hanil Bank and Commercial Bank, which the government had designated as insolvent financial institutions. Subsequently, Gwangju Bank, Gyeongnam Bank, and Peace Bank were also merged, and the group was converted into a holding company structure. During this process, more than 12 trillion won in public funds was injected, and the Korea Deposit Insurance Corporation served as the largest shareholder for over 20 years. Although the Korea Deposit Insurance Corporation sold its stake in December 2021, completing full privatization, there are still assessments that the long-standing government-led management has left the internal culture politicized.

Recently, remarks by Lee Chanjin, Governor of the Financial Supervisory Service, during the National Assembly's Political Affairs Committee audit, have reignited such concerns. On October 21, he stated, "There are some financial holding group chairmen who fill the board with their own people, essentially building a kind of trench," and added, "If there is no difference from manufacturing companies with owners or listed corporations, there is a risk that the public nature of finance could be undermined."

While his remarks were intended to emphasize the need to strengthen the independence of the board for fair management succession, some in the financial sector view them as a signal of potential government intervention in personnel matters.

This is because, under the previous administration, former Financial Supervisory Service Governor Lee Bokhyun raised concerns about board entrenchment and criticized the long tenure of financial holding group chairmen, leading some chairmen to forgo reappointment.

A financial industry official commented, "Formally, the independence and transparency of the board have been established, making it difficult for external parties to exert influence," but added, "We need to watch whether financial groups with chairmen nearing the end of their terms can truly complete the management succession process without outside interference."

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