National Agricultural Cooperative President to Be Directly Elected by Union Members... Major Overhaul of Election System

Going forward, the government and the Democratic Party of Korea have decided to push for reforms to the election system of the National Agricultural Cooperative Federation (Nonghyup), allowing union members to directly elect the president of the federation. In addition, the statute of limitations for violations of the election law will be extended to three years, and regulations on criminal punishment and fines for offering money or valuables will be strengthened. After recent audits revealed that the root cause of Nonghyup's misconduct lies in money-driven elections, the authorities plan to simultaneously reform the election process for the president and strengthen mechanisms to control vote-buying.

The Ministry of Agriculture, Food and Rural Affairs announced on March 11 at a party-government consultative meeting held at the National Assembly that it discussed the “Plan for Nonghyup Reform,” which centers on these measures.

Han Jeong-ae, Chair of the Policy Committee of the Democratic Party of Korea, is delivering opening remarks at the party-government consultation on agricultural cooperative reform held on the 11th at the National Assembly Members' Office Building in Yeouido, Seoul. Photo by Kim Hyun-min

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This reform plan was drawn up to address the structural problems of Nonghyup, including weak internal controls, lack of transparency in personnel and management, and money-driven elections, which were exposed during a special audit by the Ministry of Agriculture, Food and Rural Affairs (from November 24 to December 19, 2025) as well as a joint government audit (conducted by the Office for Government Policy Coordination, Financial Services Commission, Financial Supervisory Service, and Board of Audit and Inspection, from January 26 to March 6).

First, the government and the Democratic Party have decided to improve the election system for the president of the federation to address problems of corruption and money-driven elections. Currently, the president is elected by 1,110 local cooperative heads through voting, but the system will be changed so that all union members can participate in the vote directly. Yoon Wonsup, Agricultural Policy Director at the Ministry of Agriculture, Food and Rural Affairs, explained, “The most important issue discussed by the reform task force was improving the election system. The key is to ensure that the will of farmers-who are union members-is reflected in the election of the president and to reduce incentives for money-driven elections.”

There are two specific improvement plans under consideration. The first is to allow all 2.04 million union members to exercise one vote each to directly elect the president. The second is to organize an electoral college, in which a certain number of cooperative heads, delegates, directors, auditors, and economic project union members are selected by lottery to make up the electoral college, and voting rights are allocated to elect the president. However, if all union members participate in the vote, election costs could increase significantly. The government and the Democratic Party plan to finalize the election reform plan within this month and promote amendments to relevant laws to implement the changes.

To prevent money-driven elections, the authorities will not only strengthen criminal penalties and fines but also extend the statute of limitations (from six months to three years), ease penalties for voluntary reporters, and increase reporting rewards. Currently, the criminal punishment for those who offer or receive money or valuables is imprisonment for up to three years or a fine of up to 30 million won. This will be increased to imprisonment for up to five years or a fine of up to 50 million won. Additionally, the fine, which is currently 10 to 50 times the amount provided, will be raised to 30 to 80 times the amount provided.

Internal controls and auditing functions across all Nonghyup organizations will also be strengthened. To this end, a unified audit body called the “Nonghyup Audit Committee” (tentative name) will be established to integrate audit functions for the federation, local cooperatives, and holding companies, which were previously managed separately within the federation. In addition, a separate special corporation will be set up to ensure independent audits without oversight blind spots. Director Yoon stated, “The new audit committee will consist of seven members, including one each recommended by the Ministry of Agriculture, Food and Rural Affairs and the Financial Services Commission, one from the Korean Bar Association, one from the Korean Institute of Certified Public Accountants, and two from the federation. The appointment of external experts as compliance officers for the federation will be made mandatory.”

Reporting of criminal acts by executives and employees will be made mandatory, and if found guilty of offenses such as bribery or embezzlement, new grounds will be established for suspension from duties, thereby increasing accountability. Currently, the Minister of Agriculture, Food and Rural Affairs may suspend the president from duty if there is a clear violation of the law. However, due to unclear regulations, there has so far been no case where the minister has suspended the president of the National Agricultural Cooperative Federation. Therefore, the authorities plan to establish a provision that allows suspension from duty upon a guilty verdict in the first trial.

Institutional improvements will also be pursued to enhance transparency in the operation of Nonghyup. The government and the Democratic Party will specify the principle of prohibiting the president from intervening in the management of holding and subsidiary companies and ban the holding of concurrent positions in other jobs or titles. They also plan to increase the number of external members on the personnel recommendation committee to improve fairness in personnel management, and to strengthen disclosure to members and union members regarding personnel and other operational matters of the federation and cooperatives, thereby establishing a member- and union member-centered control system and enhancing transparency in operations.

To address problems such as the discretionary allocation of member cooperative support funds (interest-free funds), it will be specified that financial soundness must be considered when establishing funding plans, and prior reporting to the Ministry of Agriculture, Food and Rural Affairs will be made mandatory. This is in response to criticism that the president of the federation has arbitrarily expanded the use of interest-free funds (for example, to fulfill campaign pledges) and used them as political funds.

Song Miryung, Minister of Agriculture, Food and Rural Affairs, stated, “Through the swift implementation of this reform plan, we hope to resolve the issue of misconduct at Nonghyup and enable Nonghyup to become a healthy cooperative for union members, agriculture, and rural communities.” She added, “Going forward, we will work closely with relevant ministries, agricultural organizations, and stakeholders to quickly pass the reform bill, and through the Nonghyup Reform Task Force, continue follow-up discussions on revitalizing economic projects centered on local cooperatives to ensure Nonghyup can become a true cooperative for farmers.”

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