OPINION

[Editorial] Koo’s legacy

By Korea Herald

Late LG chairman leaves venerable leadership model

  • Published : May 22, 2018 - 17:30
  • Updated : May 22, 2018 - 17:30
Deviation and unlawfulness are the norm with many leaders of the chaebol, the family-controlled conglomerates. They are often embroiled in cases of collusion with politicians, bribery, tax evasion, possession of slush funds and abuse of weaker people. The late LG Group Chairman Koo Bon-moo who was laid to rest Tuesday was never like any of them.

Koo, who passed away Sunday at the age of 73, certainly was a different man than those whose only reason for running big companies is that they were born to do so.

Koo was CEO and thus the first measurement for his leadership should be LG’s performance under his baton. In that regard, Koo, who ran what has become the nation’s fourth-largest conglomerate for 23 years deserves a top grade.

LG, founded in 1947 as a chemical company by the late chairman’s grandfather, Koo In-hwoi, has grown into a business group that boasts global electronics, display, chemical and telecommunications companies.

It was since Koo Bon-moo took the helm of the group from his father Koo Ja-kyung in 1995 that the group has taken a leap toward a global tech giant. In such areas as OLED and rechargeable batteries, LG units are now the world’s No. 1 and many of its products including home appliances are household names around the world.

Accordingly, LG’s sales grew from 30 trillion won in 1994 to 160 trillion won last year and its overseas sales surged more than tenfold from 10 trillion won to 110 trillion won during the same period. The late chairman spearheaded the remarkable expansion.

One reason behind the late Koo’s successful management of the conglomerate was that unlike many of his counterparts in other chaebol, he ascended the group’s corporate ladder steadily after he first joined its chemical unit at the age of 30 in 1975. It took 20 years for him to take over the group’s stewardship. Before that, he served as the vice chairman -- the No. 2 post after his father -- for six years.

No wonder he had been well prepared to run the conglomerate by the time his father decided to hand over the reins. One of the junior Koo’s first actions was to adopt the “No. 1 LG” slogan, which means that the ultimate goal of the group is to be recognized as the market leader in business performance as well as in management practices.

Koo’s belief that the group’s management practices should also be on the par with the top global standards led to the adoption of “Jeong-Do” (right path) Management, which consists of three principles -- integrity, fair transaction and fair competition.

For Koo and LG, the company credo was never only on paper. In fact, LG is distinguished from other chaebol who often had to face public uproar and criminal investigation over various irregularities.

“Let’s build a company that is respected by the people and society,” Koo said in an address to employees in a New Year’s message last year. “We can’t be sustainable if we fail to earn recognition and trust from society, however advanced our business and management is.”

It was based on such a management philosophy that the late chairman decided to set up the first holding company for a chaebol in 2003 to resolve the problem of cross-shareholding by which chaebol families control their conglomerates with relatively small stakes.

All these earned Koo and LG a good reputation. A recent survey by the Korea CSR Research Center put LG Group in the first place among local conglomerates -- both for business credibility and the integrity of the controlling family.

Personally, the late Koo, whose penname was “Hwadam” (harmonious chat), was well known for his humble and warm manner. He used polite language to staff and he was one of the first arriving at a place of meeting or appointment.

His decision not to receive life-sustaining medical support and ask for a modest funeral and burial -- his body was cremated and was laid to rest in a natural burial grave site -- are only a very few of many episodes that tell what kind of a man he was. Koo Bon-moo left a lasting legacy, both as a successful corporate leader and a man of integrity, dignity and benevolence.