Responsibilities of the rich
The author is the economic news editor of the JoongAng Ilbo.
Lee Kun-hee, former chairman of Samsung Group, Chung Mong-koo, honorary chairman of Hyundai Motor, Lee Jae-yong, vice chairman of Samsung Electronics, Chung Mong-joon of the Asan Foundation, Shin Chang-jae, chairman of Kyobo Life Insurance, Shin Dong-bin, chairman of Lotte Group, Lee Myung-hee, chairwoman of Shinsegae Group, Chung Eui-sun, chairman of Hyundai Motor Group, Shin Dong-joo, chairman of SDJ Corp., and Chey Tae-won, chairman of SK Group were top 10 on the Forbes Korea rich list in 2010.
Eleven years later, the 2021 rank is mostly new names — Seo Jung-jin of Celltrion at No. 1, followed by Lee Jae-yong of Samsung Electronics, Kim Jung-ju, CEO of Nexon, Kim Beom-su, board chair of Kakao, Kwon Hyuk-bin, chief vision officer of Smilegate Holdings, Hong Ra-hee, widow of late Samsung patriarch Lee Kun-hee, Kim Bom-suk, board chair of Coupang, Chung Mong-koo of Hyundai Motor, Lee Boo-jin, CEO of Hotel Shilla, and Suh Kyung-bae, chairman of Amorepacific.
Even considering the late Samsung Chairman Lee’s wealth spread to family members, only two had survived in the ranking over the last decade or so. Five of them are from bio and IT industry.
Kakao and Naver have been neck-in-neck over the No. 1 rank in platform businesses on the stock exchange. After a heated race, Kakao has comfortably landed at No. 3 in market cap after Samsung Electronics and SK Hynix thanks to its share price more than doubling from the beginning of the year. Naver also has gained 35 percent but fell short of Kakao’s rally. Kakao was capitalized at over 70 trillion won ($61.5 billion) as of Tuesday, widening the gap with Naver at 64 trillion won. On group level, Kakao comes at No. 5 after Samsung, SK, LG, and Hyundai Motor Group.
The phenomenon reflects a seismic shift in the business landscape in Korea. A decade ago, the richest were owners of big corporate names in traditional industries. Self-made entrepreneurs from the IT and bio sector have ascended to take their place. The traditional players are struggling to stay competitive in search of new growth. As the Kakao versus Naver battle suggests, there is no lasting winner in the new playing field. As Steve Jobs said, entrepreneurs must “stay hungry, stay foolish” in exploring new ventures.
The cycle of the richest also has shortened. Some climb up the ladder fast and then fall at an equally dizzy pace. Kim Bom-suk of Coupang has turned the e-commerce player into a company with a valuation over 70 trillion won in just 11 years since founding the company in 2010. The net worth of his stake in the New York Stock Exchange-trading company has exceeded 7 trillion won to make him the seventh richest Korean name. Jeff Bezos, CEO of Amazon which Coupang modeld after, ranks as the richest American.
Coupang has lately come under fire due to a deadly fire at one of its biggest distribution centers. Coincidentally, the company announced Kim was withdrawing from all titles in Korea on the same day of the fire outbreak, triggering suspicion about Kim trying to avoid liability for the accident.
Coupang said the decision had been made late last month and was unrelated to the fire. Still, consumers are waging a boycott campaign saying the founder is trying to escape heavier penalties for a lack of oversight in safety measures under a new law.
Consumers do not care if they are old or new rich. They demand responsibility. Self-made or younger entrepreneurs from a promising venture cannot be pardoned for wrongdoings.
When Jeff Bezos announced he would be traveling to space in his new spaceship built by his private company, a petition urging him not to return to earth gained enormous support. After Elon Musk, CEO of Tesla, created havoc in the crypto market, a boycott movement targeting Tesla stock and even Tesla vehicles developed and a crypto coin dubbed “StopElon” was put into circulation.
The society demands the new rich to learn from the prominent Wallenberg family, Sweden’s most powerful financial dynasty, who earn respect from the society with their exercise of noblesse oblige.