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Korean conglomerates accelerate year-end reshuffles amid economic uncertainty

Published: 30 Sep. 2025, 18:06 Updated: 30 Sep. 2025, 18:30

Shinsegae Department Store in Myungdong, central Seoul is seen on Dec. 26, 2024. [YONHAP]

Korean conglomerates are hurrying their typical year-end executive reshuffle to address the growing economic uncertainties that Korea faces amid ongoing tariff negotiations and changes in the trade world.

Starting off the race was, Shinsegae Group which carried out its annual executive reshuffle last Friday, making it the earliest among Korea’s retail giants to announce such changes this year. The move came more than a month earlier than in 2024, when Shinsegae announced appointments on Oct. 30.

The changes were also broader in scope. Shinsegae replaced the heads of eight affiliates, mostly those struggling with poor performance, in what was widely viewed as a sweeping “leadership shake-up.”

LG Household & Health Care followed suit Monday, appointing Lee Sun-joo, a former L’Oreal executive, as its new CEO — the company’s first outside hire in three years since the departure of former Vice Chairman Cha Suk-yong. The move, seen as a response to slumping earnings, came ahead of LG Group’s broader reshuffle scheduled for November. Hanwha also replaced the CEOs of four affiliates at the end of August, signaling that Korea’s major conglomerates may push forward their year-end appointments earlier than usual this year.

Shinsegae and LG have already fired the opening shots, with a strategy of “renewal amid stability” to preemptively respond to next year’s economic uncertainties. But this year’s reshuffles are shaping up to be more complex than in the past.

Traditionally, Korean conglomerates announce executive appointments between late November and early December, after reviewing business plans for the following year in September and October. But insiders say appointments could come as early as late October or early November this year.

“Given the uncertainty surrounding U.S. tariff policies and the current administration’s stance on private companies, it has become more necessary to bring in new leadership to quickly devise management strategies,” said one human resources executive at one of Korea's 10 largest firms.

LG Household & Health Care's headquarters in Gwanghwamun, central Seoul [LG HOUSEHOLD & HEALTH CARE]

SK Group is seen as a prime candidate to follow. SK Supex Council Chairman Choi Chang-won hinted on Wednesday that the group’s reshuffle could be accelerated, saying at the Ulsan Forum, “The timing of appointments is flexible — it could be earlier or not.” Such public remarks from Choi on personnel timing are considered unusual.

Apart from SK hynix, SK is pushing a broad “rebalancing” in its energy affiliates, while even its cash cow, SK Telecom, has been rattled by a recent data leak, fueling expectations of significant changes.

“Last year, we replaced a considerable number of affiliate executives in the first half, so the year-end reshuffle was relatively minor,” an SK official said. “This year, appointments could come earlier and be larger in scale.”

At LG, Chairman Koo Kwang-mo will begin receiving business reports from affiliates in October, making an early reshuffle unlikely. Appointments are more likely around late November, as in 2024, though struggling affiliates like LG H&H could continue to see ad-hoc changes.

Lotte, which has traditionally announced reshuffles in November or December, may also move up its schedule this year, with executive evaluations already underway. Given mounting difficulties in both its petrochemical and retail divisions, a large-scale leadership shake-up is possible.

63 Square building where Hanwha Life is headquartered in Yeongdeungpo District, western Seoul [HANWHA LIFE]

In 2024, Korea’s five largest groups — Samsung, SK, Hyundai Motor, LG and Lotte — all scaled back the scope of executive reshuffles compared to the previous year. Most analysts expect a similarly conservative approach this year.

The key question, however, is who will fill the reduced number of executive seats. Companies face mounting external pressures and internal regulatory risks, including the “Yellow Envelope Bill” — a labor-focused revision to the Labor Union Act — leaving little room for simple cost-cutting, renewal or stability-driven appointments.

“Both regular and ad-hoc reshuffles have their pros and cons, but in today’s climate of overlapping crises, the advantages of ad-hoc changes stand out,” said Choi Young-mee, a professor at Ewha Womans University and former chief human resources officer at HP Korea and Homeplus. “Companies should reconsider the traditional system of appointing problem-solvers — whether they are strategists, finance experts or international specialists — only once a year.”

BY KIM KI-HWAN [[email protected]]