After a seven-month hunt for its new leader, the Federation of Korean Industries has finally installed Huh Chang-soo, GS Group chairman, as its chairman. The new chief of the nation’s most powerful business lobby will certainly have his hands full as he tries to reset its relations with the government.
The FKI has been denounced for pursuing the interests of big businesses and nothing else. But the criticism is mostly misplaced because it ignores that the FKI is a special interest representing big business. It is only natural for the FKI to promote the interests of large corporations, many of them under the control of influential families.
Still, it cannot be denied that many chaebol were granted more privileges than warranted when the nation was under the rule of military-backed dictatorships. This, instead of promoting fair competition among them, often yielded to temptations to pick the winners. As a consequence, the authoritarian government had large business groups, family-controlled ones in particular, at its beck and call.
Though democracy has been firmly established following a period of transition in the mid-1980s, the legacy of the bygone era still remains. The government is often tempted to exercise undue influence on business conglomerates. One such example is the pressure the government is putting on them not to raise prices. It threatens to conduct tax audits and investigations into price-fixing allegations if they fail to toe the line.
Against this historical backdrop, Huh is tasked with a mission to reset the FKI’s relations with the government. On one hand, he needs to promote the interests of the FKI’s corporate members. On the other, he has to improve the business lobby’s public image by complying with some of the requests from the government. Finding a balance between the two will be anything but easy. But that is what Huh has to do.