NH NongHyup Expected to Demand Mass Resignations from Executives—Major Leadership Overhaul Anticipated

(Seoul=Yonhap Infomax) Hyun Jung Lee – Kang Ho-dong, chairman of the National Agricultural Cooperative Federation (NH NongHyup), is set to demand mass resignations from executives across the group, signaling a sweeping personnel overhaul. With a bold reform plan targeting a 50% replacement of senior management, significant changes are expected among the heads of NH NongHyup Financial Group’s subsidiaries.

According to financial industry sources on the 21st, Chairman Kang is expected to request resignations from approximately 100 executives—including CEOs and executive vice presidents—across 33 affiliates, including NH NongHyup, distribution, and financial holding companies, as early as next week.

An NH NongHyup official stated, “It has not been finalized whether all affiliate CEOs and key central positions will be asked to resign, but the scope is expected to be substantial,” adding, “This marks the beginning of a rigorous reform to restore organizational trust.”

It is customary for affiliate CEOs to submit their resignations when a new NH NongHyup chairman takes office, respecting the new leader’s personnel authority. For example, former Chairman Lee Sung-hee implemented a sweeping reshuffle of the so-called ‘Big 7’ senior executives, including the executive vice president, just two months after taking office.

While Chairman Kang has already replaced key affiliate CEOs with close associates since his appointment, this is the first time he is seeking resignations from all NH NongHyup group executives.

This large-scale personnel shakeup is seen as an effort to restore trust in the institution, which has been undermined by recent allegations of misconduct and controversy over unfair elections.

On October 15, police raided NH NongHyup’s headquarters in connection with bribery allegations involving Chairman Kang. The organization is facing a comprehensive crisis, with issues ranging from parachute appointments raised during last month’s National Assembly audit, to improper lending at NH NongHyup Bank, rebate allegations at NH NongHyup Life Insurance, and illicit gains at NH Investment & Securities—highlighting widespread internal control and ethical lapses.

This year-end reshuffle is expected to be the first application of Chairman Kang’s recently announced personnel reform plan.

On November 10, Chairman Kang declared that half of all affiliate executives would be replaced and that re-employment of retirees would be fundamentally prohibited. Executives with poor management performance or lacking expertise will be subject to replacement. The new appointments will prioritize professionalism, integrity, and morality, with increased recruitment of external experts.

As a result, it is anticipated that key positions, including CEOs, will be subject to personnel changes.

Notably, even executives appointed just a year ago are not guaranteed job security. During former Chairman Lee Sung-hee’s tenure, more than 10 first-year executives were dismissed, setting a precedent that poor performance this year could put anyone at risk.

Chairman Kang’s sweeping personnel reform announcement has unsettled NH NongHyup Financial Group’s subsidiaries, as more than half of the executives face potential replacement, making job security increasingly precarious.

In terms of tenure, among the nine NH NongHyup Financial Group affiliates, Yoon Byung-woon, CEO of NH Investment & Securities, and Lim Jung-soo, CEO of NH NongHyup REITs Management, have terms expiring in March next year.

Although CEO Yoon achieved record earnings, internal control issues have surfaced, including an investigation by the “Joint Task Force on Stock Price Manipulation” into allegations that senior executives profited from undisclosed information.

NH NongHyup Bank CEO Kang Tae-young has one year left in his term, but a series of financial incidents and misconduct, coupled with weak performance this year, have become variables. NH NongHyup Life Insurance, which is embroiled in rebate allegations, is also reportedly under review for personnel changes.

An NH NongHyup official commented, “Depending on the outcome of this reshuffle, the overall evaluation of organizational reform could change, so it is expected to be more symbolic than ever in both scope and depth.”

hjlee@yna.co.kr

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