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Chaebol fill more than half of outside directors with ex-officials

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(Globalpost/GlobalPost)

SEOUL, May 29 (Yonhap) -- South Korea's top 20 conglomerates filled more than half of their outside directors with former government officials, data showed Wednesday, in what could be an attempt to take advantage of their ties with the government.

A total of 149 affiliates of the conglomerates appointed 94 people as their new outside directors earlier this year, according to CEOSCORE, a Web site that tracks conglomerates as well as financial firms and state-run companies.

Among them, 51 people or 54.3 percent are former government officials, retired judges, prosecutors and senior policymakers, and those who worked for the tax office and the corporate watchdog, according to the data.

The figure represents a 15.4 percentage point jump from last year when former government officials accounted for 38.9 percent of all outside directors at the affiliates of the conglomerates.

The development is the latest reminder of a deep-rooted practice in South Korea where companies scout former senior government officials to try to use their expertise and personal connections with the government for corporate profits.

Samsung Group, South Korea's largest conglomerate, has 58 outside directors -- the largest number of outside directors among South Korean companies.

Among them, 35 outside directors are former scholars and 15 others are either former prosecutors or former judges. Information on eight others was not immediately available.

Hyundai Motor Group, the world's fifth-largest carmaker, has 43 outside directors. Among them, 22 people are former government officials, including eight tax officials and seven officials who worked for the corporate watchdog.

Meanwhile, Shinsegae Group, the country's second-largest retailer, filled 15 out of its 17 outside directors with former government officials.

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http://www.globalpost.com/dispatch/news/yonhap-news-agency/130529/chaebol-fill-more-half-outside-directors-ex-officials