ed Good corporate citizens

This should be year to start changing chaebol

When Koreans elected Park Geun-hye as the next president on Dec. 19, crusaders of economic justice lamented chaebol reform would be a bygone issue. President-elect Park’s meetings with business leaders last week proved ― for now ― these pessimists wrong: she vowed to become the ``president of small businesses,” while pressing family-controlled conglomerates to change.

``Chaebol, in a sense, are ‘public corporations,’ which have grown at the sacrifice of people and with the support of the government,” she told 17 grim-faced tycoons adding, ``I seem to be the only one smiling in this room.”

The business magnates might have laughed inside at how long Park will be able to smile, considering the experiences of previous leaders who started with ideal slogans but ended up compromising with the reality.

Park should be different.

According to a survey by the Hankook Ilbo, a sister paper of The Korea Times, Koreans put rectifying polarized economy at the top of their priority list for the next government. This means the Park administration will run into serious trouble unless there is either a business boom, which is quite unlikely given the global economic situation, or visible economic reform, in the first two years of her tenure.

While campaigning, the conservative Park’s chaebol policy was to change corporate practices of the industrial behemoths without changing their ownership structure. In other words, she wants to make the best use of these global players by amending, not hurting, them. Her liberal opponent, Moon Jae-in, pledged to reform chaebol’s governance system, saying there would be clear limitations to changing giant businesses without weakening the owning families’ unwarranted control.

What Park must know is there are a considerable number of voters who agree with Moon, even among the 52 percent who supported her.

So she should stick to her pledges to keep the chaebol from infringing on business territories of their smaller counterparts, undercutting supply prices and snatching the latter’s hard-won manpower and technology as well as sternly punishing tycoons’ irregularities and refraining from issuing special pardons for them.

Chaebol will resist, as they have done before, but Park must use her mandate from voters effectively, including the threats of more radical reform borrowed from her former rival. She should be ready to use the final card of touching ownership structure on the most recalcitrant groups. No less difficult will be how to deal with the stumbling blocks within her own conservative camp ― pro-chaebol bureaucrats, party apparatchiks and journalists. But she must follow through, as the fate of her administration hinges on taming two most unwieldy groups, namely North Korea and the chaebol.

Koreans are pinning their hopes on Park having been a woman of her word. Disappointing them would be disaster, not only for the people and the national economy, but also for the new president and her administration.