The material on this site is for financial institutions, professional investors and their professional advisers. It is for information only. Please read our Terms & Conditions, Privacy Policy and Cookies before using this site.

All material subject to strictly enforced copyright laws. © 2020 Euromoney, a part of the Euromoney Institutional Investor PLC.

Trouble at the chaebol

Korea

Billions of dollars have gone missing from the coffers of a major conglomerate, allegedly channelled into criminal slush funds, reckless futures speculation and other as yet unexplained causes. Key members of the family-controlled management have been convicted of accounting fraud and imprisoned. Upon release, they are back to work at the helm of the same company they defrauded, as if nothing had happened.

Sounds like an implausible plot from a pulp-fiction thriller? Not in Korea. For shareholders in oil refinery SK Corp, it's reality. And it is looking increasingly likely that this tale might not have a happy ending.

One shareholder, SK Corp's largest single investor, is not giving up without a fight.

James Fitter, CEO at Sovereign Asset Management, says: “We went into this 18 months ago in the belief that after Roh Moo-hyun's

inauguration as president of Korea, chaebol reform was going to get a tailwind, not face a headwind.”

That has clearly not happened. Despite government attempts to clean them up, Korean businesses are still dominated by family-controlled chaebols, or conglomerates, some of which have been party to egregious cases of misgovernance and even criminal activity.

Almost since it first invested in SK Corp, Sovereign, which owns a 14.9%

You have reached premium content. Please log in to continue reading.

Read beyond the headlines with Euromoney

For over 50 years, our readers have looked to Euromoney to stay informed about the issues that matter in the international banking and financial markets. Find out more about our different levels of access below.

SUBSCRIBE ONLINE TODAY

Unlimited access to Euromoney.com and Asiamoney.com

Expert comment, long reads and in-depth analysis interviews with senior finance professionals

Access the results of our market-leading annual surveys across core financial services

Access the results of our annual awards, including the world-renowned Awards for Excellence

Your print copy of Euromoney magazine delivered monthly

£73.75 per month

Billed Annually

FREE 7 DAY TRIAL

Unlimited access to Euromoney.com and Asiamoney.com, including our top stories, long reads, expert analysis, and the results of our annual surveys and awards

Sign up to any of our newsletters, curated by our editors

LOGIN NOW

Already a user?

We use cookies to provide a personalized site experience.
By continuing to use & browse the site you agree to our Privacy Policy.
I agree