Coupang, the country's largest e-commerce (electronic commerce) company, has become the center of controversy after back-to-back setbacks. Following a breach that exposed the personal information of thousands of customers, a worker died in an accident at a logistics center. Although the company has grown rapidly, there is advice that it must strengthen internal and external risk management to maintain competitiveness going forward.
According to related industries on the 24th, Coupang recently reported to the government and notified customers that personal information for about 4,500 customers had been exposed. It was confirmed that a third party viewed customers' delivery and order-related information through unauthorized access. The information viewed included names, email addresses, phone numbers, addresses, and five order records.
A Coupang official said, "There was no access to financial information, including bank account numbers, and we also confirmed there were no signs of external intrusion into the Coupang system or internal network," adding, "Until the investigation results come out, it is difficult to comment on the exact cause, whether damage occurred, or compensation."
Coupang failed to detect this incident for more than 10 days after it occurred. According to the report the company submitted, it stated that at 6:38 p.m. on the 6th there was unauthorized access to its own account information, but recorded the time it recognized the breach as 10:52 p.m. on the 18th, 12 days later. The fact that the actual leakage time and the date (the 18th) on which customers were informed differed, failing to provide accurate information, is also becoming an issue.
On the 21st, a worker in his 30s, identified as A, who worked at a logistics center, died in an accident. A, a contract worker who had been assigned simple packing tasks, suddenly collapsed at about 10 p.m. that day in a cafeteria inside the Dongtan 1 Center in Hwaseong, Gyeonggi, and was taken to a hospital but died. A was scheduled to work from 6 p.m. on the day of death until 4 a.m. the following day.
The specific cause of death has not yet been determined. There have been several incidents in which workers at Coupang logistics centers and its delivery subsidiary died or fainted. Most were day laborers or subcontracted workers, and there have been continued calls that work environments and safety standards need improvement.
On top of that, with a permanent special prosecutor (permanent special counsel) launched to investigate alleged external pressure related to the non-indictment of Coupang's severance pay case, Coupang's management burden is expected to grow. The special counsel was launched in response to suspicions raised after the Bucheon branch of the Incheon District Prosecutors' Office issued a non-indictment in a Coupang-related case. There was a claim that Um Hee-jun, a prosecutor at the Gwangju High Prosecutors' Office who was in the leadership at the time, exerted external pressure during the investigation of the Coupang case led by Director General Moon Ji-seok of the Gwangju District Prosecutors' Office.
Coupang, which expanded its size in the domestic e-commerce market by pushing dawn delivery and other services, is coming under fire daily due to repeated controversies. Last year, it was hit with the largest-ever penalty surcharge in the retail industry, 140 billion won, and faced criticism that Bom Kim avoided designation as the same person (owner) and received so-called "lenient" preferential treatment.
Industry watchers say it is time for Coupang to strengthen internal and external risk management commensurate with its scale. Although it continues to expand its government affairs organization, there is a view that it must communicate actively with consumers and the market to shore up fundamentals. In recent years, Coupang has devoted particular effort to bolstering its government affairs capabilities by recruiting a string of former officials from the government and the National Assembly.
Lee Jong-woo, a professor in the business administration department at Ajou University, said, "As the company focused on the growth strategy typical of platform (e-commerce) corporations, which is to secure market share through aggressive marketing, it comparatively paid less attention to worker and customer safety or security issues," adding, "Especially in a market like Korea, where social responsibility is taken seriously, more thorough risk management than now is necessary." He added, "Consumers can always turn to alternatives such as Naver."