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Divide and lose (KOR)

Nov 09,2018

The author is an industrial news reporter of the JoongAng Ilbo.

“Did you check if it is really the world’s first? How can you copy the press release on the memo?”

A senior reporter scolded me when I first started my job. In fact, government and company press releases often claim to be “world’s first” as there is no stronger expression to maximize PR effect. As a reporter, it is not always easy to verify whether something is what is claims to be, especially when you have to write an article for a daily newspaper in a limited amount of time. So when I write, I try not to use the expression “world’s first.”

But I recently had a strange experience when trying to avoid the term. On Nov. 6, the ruling Democratic Party and the government announced a plan to introduce a cooperative profit sharing system for large corporations and small businesses. Right before announcing the plan, the officials at the Ministry of SMEs and Startups were obviously uncomfortable when they explained the policy.

“It seems unprecedented to institutionalize a cooperative profit sharing system. Isn’t this the first in the world?” I asked.

“Korea’s industrial structure is different from others, so it’d be better not to mention it,” responded a ministry official.

A day after the policy was presented, opposition came from the ruling party. Party members tried to downplay the policy because it was agreed at the National Assembly committee level. Far from legislating it, they said, it won’t be easy to adapt it as a party platform.

The cooperative profit sharing system is most controversial as it goes against the market economy principle defined in the Clause 1, Article 119 of the Constitution and restricts the interests of property right. Profits of companies belong to the shareholders and should not be given to others without the approval of their shareholders.

Another issue is also dividing sides. An industry source said that the sharing system gives big corporations and projects a bad impression on the companies that don’t participate in the profit-sharing system. The source said that it is virtually a compulsive system even when the government says it is a voluntary one.

The Moon Jae-in administration claimed it would continue the spirit and policy of the Roh Moo-hyun administration, but there should be some self-reflection. One of the biggest failures of the Roh administration was excessive division. While the title includes the word “cooperative,” it will separate big corporations that participate in the system from those who do not take part. It will also divide small and medium-enterprises into those that receive benefits and those that don’t. The Blue House and Minister of SMEs and Startups Hong Jong-hak are responsible for pushing policies without reviewing side effects. I am worried that the profit-sharing system will create more division.

JoongAng Ilbo, Nov. 8, Page 29