Leadership crisis dragging onWe have previously expressed concern about the crisis in filling leadership positions at public enterprises, which has been a major issue since late May. Nothing, however, has changed since then. Too many top posts are either empty or filled by interim bureaucrats.
Six months have passed since the Park Geun-hye government launched, but it is still dragging its feet on appointments. Leadership in the public sector has been on hold since the presidential election season in December, as companies put off major decisions for President Park’s new policies.
The presidential office says that appointments have been delayed because the new administration wishes to find high-quality candidates and avoid revolving-door placements. But controversy has marred the few candidates President Park handpicked. The new chairman of the Korea Development Bank Financial Group had been among the kingmakers of the president’s campaign camp. The heads of the KB Financial Group and Korea Agricultural Cooperative Federation came from the government. When these appointments led to criticism that there was a revolving door between government and public corporations, the presidential office simply stopped the recruiting process in early June, turning its energies to diversifying candidate lists. Even the selection procedure has been interrupted by the replacement of the chief presidential secretary, who heads the recruitment committee.
Damage from the power vacuum is beginning to show. Korea Hydro & Nuclear Power, the country’s largest power generation company, has been without a chief executive since the former head stepped down in June, following several employees being arrested on bribery and corruption charges. Korea Water Resources Corp. cannot sign the final water project contract with Thailand because the company is also without a chief executive.
With each vacancy comes rampant rumormongering. The stock market went into an uproar when it seemed a politician close to the president had been tapped as the new head of the Korea Exchange. The opposition party demanded a new recruitment process amid allegations that a senior official of the Ministry of Land, Infrastructure and Transport was involved in the appointment of a new chief for Korea Railroad. The newly appointed vice president of Korea Electric Power Corp. is also reportedly linked to the nuclear power corruption scandal.
The power vacuum is hurting companies and wasting taxpayers’ money. A government can accomplish a lot in its first year, but the incumbent administration is wasting this precious time.