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More than a dozen South Korean state-owned enterprises, including Korea Land & Housing Corporation and Korea National Railway, have failed government performance reviews for mismanagement over the past year, resulting in penalties such as dismissal and a pay cut.
The Public Establishments Management Committee on Monday announced the results of its 2021 management review of the country’s state-owned enterprises.
The evaluation was carried out by a team of 109 private experts including professors, accountants and partners trained by the Ministry of Finance and the Economy in February on the performance of 130 establishments, including 36 public companies and 57 parapublic establishments on a scale of 100 points.
In the annual ranking, 18 companies including LH, KORAIL and Korea Racing Authority failed.
As a result, the CEO of the Korea Maritime Transportation Safety Authority would be removed from his post and the heads of three institutions would receive a warning. Executives of 11 companies that posted net losses will have to voluntarily return their annual bonuses.
Korea East-West Power was the only company to receive the highest S rating, becoming the first state-owned company to receive the satisfactory rating in 10 years for its achievements in preventing safety-related accidents and promoting safety. ethical management. Its debt ratio also stood at 102.1%, the lowest among state-owned energy companies.
Korea South-East Power, Korea Expressway Corporation and 21 other institutions received an outstanding A rating and 48, including Yeosu Gwangyang Port Authority and Korea Hydro & Nuclear Power’s B rating. Forty others were rated C, including Kangwon Land and Incheon International Airport Corporation.
Fifteen institutions including Korea Racing Authority, LH and Grand Leisure Korea were awarded grade D and KORAIL, Korea Postal Logistics Agency and Korea Maritime Transportation Safety Authority grade E.
Company directors who receive E or D for two consecutive years are subject to dismissal. In this year’s management assessment, a total of eight institutions fall into the category – LH, KORAIL, Korea Racing Authority, Korea Maritime Transportation Safety Authority, Korea Postal Logistics Agency, National Institute of Ecology and Korea Construction Equipment Safety Institute, and Korea Creative Content Agency.
The 18 establishments with D and E grades and 14 with fatal accidents will be required to submit improvement plans to the Ministry of Finance. Establishments with D and E grades will also face a 0.5-1.0% reduction in current costs next year and their employees will be excluded from bonuses.
The public committee also advised the chiefs, auditors and executive directors of KEPCO and its 9 subsidiaries and 11 state-owned companies that recorded net losses last year to return bonuses voluntarily.
By Lee Jong-hyuk, Lee Hee-jo, Song Gwang-sup and Lee Eun-joo
[ⓒ Pulse by Maeil Business News Korea & mk.co.kr, All rights reserved]