It was confirmed on the 7th that Kim Byung-hwa, Chairperson of the Judicial Evaluation Committee of the Korean Bar Association, was elected as the chair of the NongHyup Financial Group board. Chairperson Kim has taken on the role of board chair just eight months after being appointed as an outside director of NongHyup Financial Group at the end of April last year.
Chairperson Kim is an outside director recruited under the leadership of NongHyup Central Association Chairman Kang Ho-dong last year. At the time of his appointment as an outside director, it was speculated within the financial sector that he would play a role in consolidating the ties between the Central Association and NongHyup Financial.
Chairperson Kim is a lawyer with a background as a prosecutor, having served as the chief prosecutor of the Incheon District Prosecutors' Office and the chair of the legal aid foundation of the Korean Bar Association. Since retiring in 2012, he has been working at Kim & Chang, and he served as a director of the National Agricultural Cooperative Federation from 2016 to 2018.
When Chairperson Kim served as a director of the Central Association, the chairman was former Chairman Kim Byung-won. Former Chairman Kim is known to have aided Chairman Kang in the Central Association's election early last year. Following Kang's inauguration, former Chairman Kim was employed as a visiting faculty member at NongHyup University. There have been criticisms within NongHyup regarding this appointment, noting that the university had not appointed visiting faculty for five years since 2019.
Chairperson Kim's tenure overlaps with Chairman Kang's term on the Central Association's board. Chairman Kang held the position of representative director of the Hapcheon Yulgok NongHyup from July 2016 to January 2020.
There was also controversy in the process of selecting outside directors. At the beginning of last year, NongHyup Financial's term for four of the seven outside directors expired, but only three were newly appointed. The remaining position was filled by Kim Byung-hwa after Park Heung-sik, an outside director of NongHyup Financial and chairman of the Gwangju Bia NongHyup, joined the candidate recommendation committee. Outside directors are seen as positions through which the Central Association exerts influence over NongHyup Financial. Director Park is also known to be an associate of Chairman Kang.
The recent election of the chairperson has led to analyses within NongHyup that the 'Kang Ho-dong system' of NongHyup Financial has become even more solidified. Chairman Kang is evaluated to have further strengthened his organizational control through personnel changes at the top management (CEO) level of NongHyup Financial affiliates at the end of last year. Individuals considered close to Chairman Kang were appointed as CEOs of key affiliates, including NongHyup Bank, NongHyup Life Insurance, and NongHyup Property & Casualty Insurance. It is also reported that some affiliate CEOs resigned under pressure from the Central Association before their terms ended.