[Viewpoint] Underdog leashed

Never in his wildest dreams had he imagined the consequences of getting in the way of a government appointment.

Lee Jung-hwan, who finally stepped down as the chairman of the Korea Exchange last week, may have been punished because of such ignorance.

Lee recalled the unrest of sitting in the hot seat for the last 19 months. He never intended to, nor was capable of, boycotting a government appointment. The only excuse he could give himself is that he was in the wrong place at the wrong time.

In March 2008, soon after the new administration was sworn in, the Korea Exchange was deliberating its second leader since the securities and futures bourses were merged into one.

Lee was among three candidates for the new chief executive. Then a new contender entered the race with strong backing from the presidential office.

Nine members of the screening board decided to cross off the new name at the initial stage in fear of greater pressure down the road. As a result, Lee was voted in as the new head. Everyone praised themselves for braving another display of government arm-twisting.

The stock exchange had resisted government recommendations during the first CEO contest in 2004 and again for the auditor appointment in 2006.

Then the air started to feel different in May of this year.

The prosecution raided the bourse’s headquarters in Seoul and Busan for the first time in the stock exchange’s history. The exchange’s outside board directors who were involved in the screening process were replaced. People began to whisper that the government considered Lee an eyesore.

In January, the government, out of the blue, made the securities market a public asset because it had been a monopoly. The move raised many eyebrows as it came from a government that had pledged to privatize public institutions for greater competitiveness.

Stock exchange employees were furious, calling the move an attempt to swallow up and nationalize a company using taxpayers’ money.

Lee’s worries deepened. Whenever he met friends, he would ask for their advice on when would be the best time for him to quit. He blamed himself for turning the stock exchange into a public entity, having put “the clock on Korean finance back by 20 years.”

The local market was going back in time whereas major stock markets in New York and London were racing for stronger competitiveness through privatization, public offerings and mergers and acquisitions.

In March, he dared to propose a bargain with the authorities, offering to step down if the Seoul bourse was turned back into a private independent entity.

He was warned to watch his mouth.

Earlier this month, he finally submitted his resignation. But he did not leave quietly.

In the interim online community board, he retold the turbulence he suffered over the past year. Some of his accusations may have been overstated and misleading. But we cannot take the incident lightly if the government indeed attempted to kick someone out because it had someone else in mind in his place.

The case should be closely investigated to prevent such an egregious event from happening again.

Without finance maturity, we cannot dream of joining the ranks of advanced countries.

The current government should know this well, yet it rarely has employed men well-versed in finance. Instead, it has been busy sacking men from the past administration and putting its own men in their places.

Looking back, it’s clear that Lee was one of the underdogs.

One government aide summed it all up. “Everything might have been all right if we had just obliged in the first place. Then we wouldn’t have seen such a fiasco.”

*The writer is business news editor of the JoongAng Sunday.

by Lee Jung-jae