Woori Financial Group Chairman Yim Jong-yong / Yonhap

Woori Bank said Thursday that it had scrapped its decades-long practice of morning group exercise on Sept. 2 in the first move to reform the long-troubled corporate culture defined by chain of command.

Advancing the latest effort of the beleaguered lender are a slew of employee misconduct and embezzlement, all part of an overarching questionable lending and business practices.

Observers say the move will be reduced to nothing more than an empty gesture unless backed by a drastic overhaul of the longstanding cronyism-oriented appointment of the group's outside directors.

"It's a problem left unaddressed, unscrutinized and unaccounted for," Lee In-ho, former Seoul National University professor of economics, said.

Every time a new chairman of a financial holding firm assumes control, the first change that follows is the makeup of the outside directors, whose votes are crucial to the potential third term reign of the new head, Lee said.

"The recommendation committee can vote the chairman in, in an all-but-foregone conclusion. Sometimes not including the CEO of the group's bank – the income generator of at least 95 percent of the group's revenue – on the board makes headlines. That speaks volumes about how insulated the reign of the current chair can be."

The oversight function and responsibilities of board directors remain essentially defective, as highlighted by their long-criticized procedure of rubber stamping the decision engineered by the chair, he added.

"The criticism of the board concerning the failure to hold the chairman accountable is nothing new. But the recent scandals have definitely amplified the long-troubled practice at one of the country's five most powerful holding firms."

Meanwhile, the scrapping of the morning routine follows a survey of Woori employees from Aug. 14 to 22. Over 88 percent of the respondents agreed to canceling the morning exercise, citing inefficiencies.

The collective move garnered significant support from branch employees, many of whom were forced to participate in the morning exercise.

Woori Bank plans to outline 100 key tasks to reform the organization and boost productivity.

Woori's card subsidiary will streamline and simplify the workflow to remove unnecessary meetings and written report submissions.

The bank will also revamp its credit evaluation procedures to facilitate transition to digital, contactless transactions for corporate borrowers.