South Korea’s leading telecom operator KT once again faces an escalating “CEO risk” as police sought an arrest warrant on Monday for its CEO Hwang Chang-gyu for alleged involvement in the firm’s illegal donations to lawmakers.
Hwang was suspected of creating 1.1 billion won ($1 million) in slush funds from May 2014 to October 2017 and of spending 442 million won of the money for illegal donations to 99 lawmakers.
Hwang Chang-gyu arrives for questioning at a police station in Seoul on April 17. (Yonhap)
KT said it has no official comment on the issue except that it would “sincerely respond to the investigation.” However, insiders say the repetitive resignation of its CEOs apparently under political pressure negatively affect the employees’ morale.
“All the CEOs were made to step down disgracefully every time the administration changed even though KT is no longer a public company,” said an anonymous official from KT.
Except for former CEO Lee Yong-kyung, who led KT’s privatization, all the other following CEOs had stepped down disgracefully.
Former Chairman Nam Joong-soo, for one, stepped down after prosecutors raided his home and office over alleged charges of corruption in 2008 under the Lee Myung-bak administration.
Another former CEO Lee Suk-chae also resigned in 2013 after prosecutors began an investigation over alleged charges of creating slush funds under the Park Geun-hye administration.
Similarly, Posco, which was turned into a private company 18 years ago, is searching for a new head after its CEO Kwon Oh-joon decided to step down in April, without completing the two years left in his second term. There have been rumors that he is stepping down due to political pressure.
By Shin Ji-hye (firstname.lastname@example.org)