Sharing the success

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Sharing the success

President Park Geun-hye reiterated one of her favorite campaign buzzwords - economic democratization - during her inauguration speech, pledging to uproot unfair practices that discourage and victimize smaller businesses. She was indirectly advising large companies to reform themselves.

To please the new president, the business sector issued a statement vowing to meet her halfway. Lee Seung-cheol, the newly elected vice chairman of the Federation of Korean Industries, an interest group of the country’s largest business groups, said in a statement that the organization will work to relay consumer opinions to the business sector. The comment implies it will stand more on the side of the people instead of backing the industrial sector. The FKI said it will try to reinvent itself in order to win the support and admiration of the public. We just hope the statement is not just empty rhetoric.

Our society has an unusually high level of anti-corporate sentiment, largely toward the chaebols, despite their contribution to the country’s current reputation as an industrial powerhouse. The large corporate sector may grumble about the lack of appreciation for its part in the advance of the Korean economy. The chaebols - Samsung, Hyundai, LG and Posco to name a few - have all turned into global-scale enterprises thanks to their innovations and daring ventures overseas. Still, they’re resented by the public and have become a popular political target.

This is because their accomplishments have been undermined by their greediness and overuse of their enormous resources in gaining market advantages. Unfair trade practices are the best example. They may involve only a few large companies, but some have outright stolen technologies from smaller competitors and pressured them to lower supply prices. Their expansion into bakeries, cafes and other small-business franchises and mom-and-pop style industries aggravated resentment toward the power that the chaebols wield and the liberties that they take. Large companies neglected to share their prosperity with their smaller partners. They turned a deaf ear to calls for social responsibility and a greater role in easing economic polarization and inequalities. The large companies grew richer and richer, but the overall economy only weakened.

The large companies themselves are the ones who are best qualified to clear their names. And it would be for their own benefit. If they remain standoffish, the resentment will only escalate and invite various state regulatory actions. They must contribute to their communities and demonstrate a desire for symbiotic prosperity. They must offer more entitlement programs and increase their efforts to help their small and mid-sized peers. A corporate sector loved by the people can save the economy and the country as well.

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