FKI should take bold steps toward total innovation
The Federation of Korean Industries (FKI) is poised to make a new start, having chosen Poongsan Corp. Chairman Ryu Jin as its new leader. Ryu will be officially tapped as the new leader during an extraordinary general meeting slated for Aug. 22. Announced in May as part of a reform package, the Korea Economic Research Institute (KERI), an FKI affiliate, will be merged into the nation's largest business lobby.
Ryu had been widely regarded as the most suitable figure to lead the FKI. For starters, Ryu has served as vice chairman of the lobby for more than 20 years ― since 2001. He is currently a co-head of the Korea-U.S. Business Council, dedicated to promoting exchanges and cooperation between business leaders of the two countries. He is also serving as vice chairman of the Korea-Japan Economic Association.
Ryu's stints also include being a board member of the Center for Strategy and International Studies (CSIS). All this demonstrates Ryu's international career and networking abilities. In recognition of his contribution to the development of relations between Korea and the United States, Ryu was awarded the Van Fleet prize last year by the Korea Society, a non-commercial organization.
Given this, expectations are growing that Ryu's selection as the new FKI chief will help further enhance the alliance with the U.S., riding on recently upgraded bilateral ties toward a values-oriented alliance.
Founded in 1961 and led by then-business leaders such as Samsung Group founder Lee Byung-chul, the FKI served as the mouthpiece of the nation's major conglomerates. In fact, its motto at the time was "Serving the nation and society through business activities."
Yet it faced a grave crisis due to its connection to the corruption scandals involving former President Park Geun-hye. In the midst of the scandal, the nation's four major business groups ― Samsung, SK, Hyundai Motor and LG ― withdrew from the organization. The lobby was stripped of its status as a dialogue partner with the political circle under the previous Moon Jae-in administration.
Since the onset of the Yoon Suk Yeol administration, the lobby has been expanding its influence while assisting the government's efforts to improve relations with the U.S. and Japan. After Huh Chang-soo, GS honorary chairman, stepped down as the FKI chair in January, former Deputy Prime Minister Kim Byong-joon took the helm as acting chairman. Under Kim's leadership, the FKI explored ways toward reviving itself.
Ryu's assuming of the leadership will likely add momentum to the FKI's bid to return to normality, bringing to an end its seven―year long predicament. Ryu should proactively reflect the voices of the nation's businesses, especially amid the growing rivalry between the U.S. and China in global markets.
Ryu faces diverse and daunting challenges in his bid to help the FKI regain its fame as the predominant economic organization in Korea. Most importantly, he should focus on casting off past malpractices of collusive ties between business and politics. To this end, it should map out a stricter internal control system. It should also look to discard its previous image of protecting the interests of big conglomerates only.
We hope the FKI abides by its pledge to make a fresh start as a "think tank" dedicated to safeguarding the free market economy. Through such changes, it should be able to attract the four major business groups to join it again.
Amid rapid changes in the business situation at home and abroad, the Korean economy is bracing for tectonic challenges such as dwindling economic growth. It is time to promote entrepreneurship equipped with challenging and innovative spirits. For this, the FKI should do its utmost under the new leadership. Based on such endeavors, the FKI will be able to be reborn as an influential think tank. We hope the lobby will continue to grow as a respectful global institute.
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