Chung Yong-jin elevated to chairman of Shinsegae Group

Shinsegae Group's new Chairman Chung Yong-jin [SHINSEGAE GROUP]

Chung Yong-jin, 55, vice chairman of Korea’s retail conglomerate Shinsegae Group, has been promoted to chairman on Friday.

Shinsegae Group announced the promotion on Friday, highlighting the need to "adapt to a swiftly evolving business landscape," such as with local e-commerce giant Coupang and Chinese e-commerce platforms like Alibaba's AliExpress, referring to the move as a strategic "frontal breakthrough" with Chairman Chung at its core.

"The increasingly competitive retail market is fraught with diverse challenges unlike any seen before, and in such times, strong leadership is paramount," Shinsegae Group said in a statement Friday.

Offline retail powerhouses like Shinsegae have been struggling with financial challenges lately with the rapid emergence of e-commerce platforms in the heat of the Covid-19 pandemic.

Despite the group's hypermart chain, Emart, logging record-breaking annual revenue of 29.5 trillion won ($22.3 billion) in 2023, Shinsegae could not overcome an unprecedented operating loss of 46.9 billion won. Despite attributing the losses to significant deficits incurred by its affiliate Shinsegae Engineering & Construction, Emart's stand-alone profits plummeted by 27.3 percent on-year to 188 billion won.

Korea's largest online shopping platform Coupang surpassed Emart in revenue for the first time last year, reaching 31.8 trillion won.

"The significance of Chung's promotion cannot be understated," Shinsegae said. "To meet the demands of increasingly discerning customers in today's rapidly evolving retail landscape, we need strategies that go one step faster and one step further. Moreover, we must strengthen the competitiveness of our core businesses [such as Emart], while continuously seeking new growth opportunities."

Chung has overseen the management of Shinsegae's Emart, food, and hotel sectors, while his younger sister, Shinsegae Executive President Chung Yu-kyung, has managed the group's department store, duty-free, and fashion sectors.

The promotion marks the elder Chung's first advancement in 18 years since assuming the role of vice chairman in 2006.

The promotion did not result in any changes to the group's ownership structure. Chairman Chung holds an 18.56 percent stake in Emart, while Executive President Chung holds an 18.56 percent stake in Shinsegae.

Chung's mother, Lee Myung-hee, remains in management as the group's general chairperson, retaining a 10 percent stake in both Emart and Shinsegae.

In addition to being a corporate owner, the new 55-year-old chairman has gained recognition as a social media influencer, often sharing aspects of his daily life, including recommending snacks and posting cooking photos. However, his outspokenness on social media, such as posting the term myeolgong ("crush commies") in a dramatic departure from the typically reserved public persona exhibited by other Korean chaebol who typically refrain from expressing their views online — have also posed risks for Shinsegae Group, including the inducement of a sharp decline in its share prices.

BY SEO JI-EUN [seo.jieun1@joongang.co.kr]