[EDITORIALS]Business federation reform

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[EDITORIALS]Business federation reform

Son Kil-seung, the chairman of SK Group, resigned his post as chairman of the Federation of Korean Industries, due to his involvement in an illegal political funds scandal. This is the second time that the federation’s chairman had to step down midway in his term. Mr. Son’s predecessor, former Daewoo chairman Kim Woo-choong, also resigned amid disgraceful circumstances. Mr. Son’s resignation has left many wondering whether the future of the federation, one of Korea’s biggest business advocacy groups, isn’t in jeopardy.
The federation comprises about 60 groups representing different industries consisting of over 400 companies. It played a crucial role during the developmental years of Korea’s economy. But the federation has lately been criticized for failing to adapt to the changing times. Several scandals involving bribes from its members to politicians have hurt the federation’s moral reputation and internal strife has led to speculation that it will not last much longer.
Current economic and social conditions require business unity. It is the role of the businesses, not the government, to encourage investment, which has dwindled under the open economy. A channel of communication is needed to aggregate opinions within the business world and to develop common positions. The fact that the federation, which should be at the center of such efforts, has practically become immobilized is a tragedy for the entire Korean economy.
The federation must revive as the representative group of Korean businesses. First, it must end its internal strife. Above all, it should reform its leadership system, centering on business figures with leadership skills and social reputation. Also, more effort should be made to break the chains of political bribery and to restore public trust in the morality of business.
Only painful reform and the determination to adapt to changing times will allow the federation to regain its reputation and restore its proper function. If things continue this way, the rumors that there is no future for the federation might just become reality.
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