NPS faltering amid workforce exodus
By Nam Hyun-woo
People walk past an information board at the National Pension Service Investment Management headquarters in Nonhyeon-dong, southern Seoul, on Dec. 21. / Korea Times photo by Bae Woo-han
Key asset-running workers are leaving the National Pension Service (NPS), as a series of events are turning the state pension fund into an unattractive workplace.
According to officials, 30 employees at the NPS Investment Management (NPSIM), an investment arm of the NPS, quit last year. Also, eight additional employees have tendered their resignations as of last week.
Most of them are working-level employees, who were in charge of domestic and foreign investments, and asset and risk management. They reportedly moved to securities firms, insurers and asset management firms, including Samsung Life, Samsung Securities and Igis Asset Management.
Given that only 25 employees left the NPSIM from 2012 to 2014, observers describe the recent move as an “exodus.” The total number of employees at the NPSIM is hovering at around 250 to 260.
Though the NPSIM outsources many parts of its tasks -- about 50 percent of domestic funds are run by commissioned financial firms -- the NPS says the loss is critical because the employees were in charge of cooperating with those outside partners.
“The outflow of human resources is occurring all across the NPSIM, with the foreign investment department facing the most serious situation,” an NPSIM official said. “The outflow is stemming from NPS’s scheduled relocation to Jeonju.”
The NPS is in the final stages of moving from Seoul to Jeonju in North Jeolla Province. As the final phase of the relocation, the NPSIM will move its headquarters from Nonhyeon-dong, southern Seoul, to Jeonju, Feb. 17.
Unlike several public firms that moved from Seoul while leaving some offices in the capital city, the NPS will make a full-scale move to Jeonju, meaning there will be no office in Seoul. The current NPSIM headquarters building is now up for rent.
Adding to the relocation, a corrupt scandal involving President Park Geun-hye and her confidant Choi Soon-sil is also accelerating the brain drain.
The NPS is accused of being a vehicle of the merger between Samsung C&T and Cheil Industries, which helped Samsung’s de facto leader Lee Jae-yong enhance his control of the group.
In return for NPSIM’s approval of the merger, Samsung allegedly “donated” 43 billion won ($37 million) to Choi.
This dealt a heavy blow to NPS officials who were proud of working at a prestigious investment institution running 550 trillion won in assets.
“The entire organization is in a gloomy mood,” another NPS official said. “With the NPS head being arrested, the organization is seemingly losing control of its business.”
NPS chief Moon Hyung-pyo was indicted over abuse of power for allegedly pressuring the NPS to vote in favor of the merger while he was minister of health and welfare.
The NPSIM is yet to set up its investment blueprint for this year, more than three weeks into January.
After the scandal erupted, the NPS and the NPSIM have been at odds over who should take care of some key functions of the NPSIM.
To cope with the vacancies, the NPSIM posted 30 job openings such as strategists, risk managers and fund managers in November, but managed to hire only 16 people. Reportedly, many applicants fell short of required qualifications.
“Frankly, it will take time before the NPS gets back on track,” the NPS official said. “In this emergency situation, the leadership is also losing control of the organization.”