KAI announces plans to boost transparency

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KAI announces plans to boost transparency

Korea Aerospace Industries (KAI) announced a set of reform plans on Friday, aimed at radically improving transparency and fairness in the company’s management activities next year.

The document comprises 80 “renovation tasks,” which involve human resources, transparent book keeping and weapon purchasing in KAI’s business management.

These were all problems spotted in the company’s major corruption scandal this year, which led to the prosecution of nine former top?level executives, including former CEO Ha Sung-yong.

Friday’s reform plan came from a special team named the “management innovation committee,” led by the new CEO Kim Jo-won, previously a secretary general of the Board of Audit and Inspection. Launched in November, the committee’s study concluded that the fundamental problem was that the company had rapidly grown without improving its internal management system.

One point of analysis was 1,446 opinions received from inside the company regarding problems employees thought KAI should improve upon, based on which the 80 tasks were devised.

To ensure that KAI does not repeat the mistake of letting influential people affect its hiring process, the company will adopt a blind hiring policy whereby personal information will not be weighed, and it will immediately dismiss those who violate the new practice. Employee assessments and promotion criteria are to be worked out through discussions with its labor union.

Plans to enhance transparency inside the company generally involve pulling in external advisors or surveillance. Apart from applying an upgraded set of international accounting standards, IFRS 15, the company will receive advice from an accounting firm on its book keeping.

BY SONG KYOUNG-SON [song.kyoungson@joongang.co.kr]
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