SEOUL, Mar. 12 (Korea Bizwire) — South Korea’s key business groups still prefer retired government officials as outside directors despite alleged bribery involving former President Park Geun-hye and some conglomerates, data showed Monday.
A total of 46 former government officials were appointed by the listed units of the top 10 family-controlled conglomerates this year, or 34.8 percent of the total 132, according to the data from market researcher Chaebul.com.
The most were retired ministers and vice ministers, with 12, followed by former prosecutors and judges with 11. An additional six were from the finance ministry, seven from the National Tax Service, six from the Financial Supervisory Service and four from the Fair Trade Commission.
The leading conglomerates appointed 44 professors as outside directors this year, down from 57 a year earlier.
Last year, professors took up the biggest portion of outside directors at the conglomerates as they struggled to cope with the alleged graft scandal that shook the nation and led to Park’s ouster.
By group, Lotte had the most, with 11 retired government officials as outside directors, followed by Hanwha with eight, Hyundai Motor Group with seven, Samsung with six and Hyundai Heavy Industries with five.
Samsung, Lotte and several other groups are involved in the corruption scandal, with Samsung’s de facto chief Lee Jae-yong and Lotte Chairman Shin Dong-bin on trial for allegedly seeking business favors in return for bribes.
South Korea adopted the outside director system in 1992 to keep chief executives and large shareholders from making unilateral decisions that run against a company’s interests. But outside directors have been under flak for serving as mere rubber stamps.