When art meets reality in Korean ‘chaebol’

When art meets reality in Korean ‘chaebol’

Kang Tae-moo arrives in Seoul from New York and heads to the office immediately. The tall, dashing heir to Geumhwa Group, a chaebol founded by his grandfather, Chair Kang Da-goo, snubs his inauguration ceremony as president of the subsidiary Go Food. He also fires a company executive for misbehaving.

The chaebol has always been associated with corrupt executives, but K-drama has given its image a grand makeover featuring Tae-moo, played by Ahn Hyo-seop, in Netflix’s new rom-com hit “Business Proposal.”

Big conglomerates 

Emerging during the Japanese occupation of South Korea before the end of World War II, the chaebol groupslarge family-run business/industrial conglomerates — were modeled after the zaibatsu, Japan’s industrial and financial conglomerates. They’ve enjoyed government support in the form of special loans since the 1960s, and gained prominence under President Park Chung-hee (1963-1979), whose export-driven administration “prioritized preferential loans to export businesses,” according to a backgrounder by cfr.org.

Wielding massive influence in politics and keeping the wealth within the family through the decades, their presence is so deeply ingrained in South Korea’s national psyche that “large conglomerates and Korean economy cannot be separated from politics and the culture and history,” remarked Yonsei University Prof. Rhyu Sang-young in the same backgrounder. 

Their symbiotic relationship allowed chaebol groups to lobby for legislation in their favor and the government to ask for “financial support during campaigns … often touting chaebol economic successes as national ones,” continued cfr.org. But the prime mover of one of the largest world’s economies seemed to have changed into simply being a government financier, leading to what critics have highlighted as the downside of the quid pro quo: embezzlement, bribery, tax evasion, and avoidance of military duty.

Clamor for chaebol reform rose and gained momentum between 2016 and 2017 when President Park Geun-hye (2013-2017) was sentenced to 25 years’ imprisonment for soliciting bribes.

LOVE AND BUSINESS  Kang Tae-moo and Shin Ha-ri break class norms in the name of love. – PHOTO BY NETFLIX.COM

Reforming chaebol 

Park’s predecessor, Kim Dae-jung (1998-2003), was set to crack down on chaebol groups with the Monopoly Regulation and Fair Trade Act, which banned cross-shareholdings among companies that belonged to the same group, and limited equity investments and reciprocal debt guarantees. But then came the 1997 financial crisis, and all he could do was appoint external directors with the authority to demand consolidated financial statements and attach legal liabilities to the position of chair, said a report in eastasiaforum.org.

Lee Myung-bak (2008-2013), Kim’s successor, halted the little progress made by abolishing the total equity investment ceiling system.

President Moon Jae-in (2017-2022) picked up the baton for chaebol reform with the Commercial and Fair Trade Act, wanting to improve rights of minority shareholders, strengthen separation of ownership from management, and end circular or cross-shareholding — a practice that keeps control of the conglomerate in the family through a series of capital contributions to companies within the family business group.

President Yoon Seok-youl, who assumed office last May 10, has pushed chaebol reform to the back burner, focusing instead on “[supporting] business leaders who create jobs, [easing] regulations, and [cutting] taxes for companies that bring their factories back home from overseas, said a report in The Korea Herald. 

He was expected to pursue chaebol reform, being a former prosecutor general who doggedly investigated and indicted leaders of major conglomerates, i.e., Samsung Electronics vice chair Lee Jae-yung for bribery and embezzlement in 2017, SK Group chair Chey Tae-won for embezzlement (without detention) in 2012, and Hyundai Motor chair Chung Mong-koo for embezzlement (with detention) in 2006.

But reforming the chaebol groups’ hierarchical culture is underway. Top executives are encouraging employees to call them by their English names because Koreans are unable to call their bosses by only their Korean names, said an article in The Korea Times. For example, it’s “Tony” for SK Group chair Chey Taewon, “JH” for Samsung Electronics vice chair Han Jong-hee, “KH” for Samsung president Kyung Kye-hyun, and “Sam” for Lotte Group vice chair Kim Sang-hyun.

Reel ‘chaebol’

K-drama’s Tae-moo proves his position isn’t an offer of sinecure. The impeccably dressed Harvard graduate increases the sales of their mandu and kimchi products in the domestic and international markets. He redevelops kimchi — substituting anchovies for fish sauce to appeal to foreigners — and makes ready-to-eat tteok-bokki available in supermarkets.

Part of Tae-moo’s ilk is Lee Young-joon, Yumyung Group’s vice chair in the 2018 rom-com “What’s wrong with Secretary Kim?” Played by Park Seo-joon, the gorgeous US-university graduate doesn’t tolerate errant employees and fires one of the wayward directors. He’s meticulous, reading through every business proposal, contract, etc.

By being egalitarian, acknowledging those who work well and penalizing those who flout company rules, Tae-moo and Young-joon shatter the chaebol’s careerist image. By choosing to marry outside of their class, they dismantle the social hierarchy, and thus advocate social mobility and protest arranged marriages. Tae-moo falls for one of Go Food’s senior researchers, Shin Ha-ri. Young-joon is smitten with his secretary of nine years, Kim Mi-so. 

The duo are more than acceptable compared to their opposites: Jang Jun-woo, Babel Group’s maniacal chair played by OK Taec-yeon in the 2020 “Vincenzo,” who gets a taste of his own medicine, and Kim Won, Jeguk Group’s (JG) martyr chair played by Choi Jin-hyuk in the 2013 “Heirs,” who sacrifices love to keep JG in the family.

With their hierarchical world and despite their wealth, real chaebol top executives are bitter pills to swallow. But K-drama makes coexistence possible: Kang Tae-moo and company live in an honest world filled with opportunities and love that knows no boundaries, as they cross lines and allow lines to be crossed. 

Accepting the chaebol world of K-drama is effortless in this time of political flux. It’s a place where chaebol power doesn’t trample on humanity and dreams.

LIMELIGHT  Vice chair Lee Young-joon, played by Park Seo-joon, basks in his aura in “What’s wrong with Secretary Kim?” – @bn_sj2013
NAME Samsung SK Group Hyundai Motor LG Group Lotte
YEAR FOUNDED 1938 early 1950s 1947 1947 1948 in Tokyo; 1967 in South Korea
RANK first second (was originally ranked third, but outranked Hyundai Motor after 12 years because of SK Hynix) third fourth fifth
HISTORY started as food exporter to China  started when Sungkyong Textiles was acquired started as a small construction business started in chemical and plastic industries  started as maker of chewing gum
BUSINESS electronics and technology, finance, engineering, an affiliated university, and amusement park construction, shipping, marketing, internet, and wireless broadband automotive, finance, electronics, construction, shipbuilding 
electronics, chemicals,  telecom  department stores, hotels, amusement park, petrochemicals, electronics
ICONIC SUBSIDIARY Samsung Electronics SK Telecom (largest local wireless carrier)
SK Hynix (world’s second-largest maker of memory chips)
Hyundai Motor LG Display (global market leader of OLED TV) Lotte Confectionary (third functional chewing gum manufacturer in the world)

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