'Empty Resignation' Namyang Dairy CEO Hong Won-sik and Family All Report to Work... Civic Groups Join Criticism

Hong Won-sik, chairman of Namyang Dairy Products, is holding a public apology press conference related to the 'Bulgaris incident' at Namyang Dairy Products headquarters in Gangnam-gu, Seoul on the 4th. Last month, Namyang Dairy Products announced at the 'Symposium on Developing Antiviral Foods in the COVID-19 Era' that the Bulgaris product was confirmed to reduce COVID-19 by 77.8%. However, the research results were revealed to have exaggerated the findings from animal 'cell-level' experiments, causing controversy. In response, Hong Won-sik, chairman of Namyang Dairy Products, announced his intention to resign at the public apology press conference on the same day. Photo by Kim Hyun-min kimhyun81@

[Asia Economy Reporter Seungjin Lee] Civic groups have criticized Namyang Dairy Products as family management continues, with Chairman Hong Won-sik, who had promised to resign, and his wife, Advisor Lee Un-kyung, working at the company at the executive director level.

According to related industry sources on the 24th, Advisor Lee Un-kyung of Namyang Dairy Products is working full-time at the company with the executive director rank. Together with the second son, Executive Director Hong Beom-seok, head of the Food Service Business Division, she oversees Namyang Dairy’s food service division, which includes 'Baekmidang.' It is known that she receives a salary commensurate with the executive director rank and is provided with a company car and corporate card.

Previously, Advisor Lee sparked controversy by violating the ban on private gatherings. On June 19, she was reported for violating the ban on private gatherings of five or more people by inviting more than five people to a meal at her home in Seongbuk-gu. The Seongbuk Police Station in Seoul received the related complaint and completed the investigation of the complainant.

Chairman Hong Won-sik, who held a tearful press conference and promised to resign three months ago, still maintains his position as chairman. Hong Jin-seok, the eldest son and executive director who stepped down in April amid allegations of embezzlement of company funds, was reinstated as executive director in charge of strategic planning on May 26, the day before the announcement of the sale to Hahn & Company. The second son, Hong Beom-seok, head of the Food Service Business Division, was also promoted to non-registered executive director (deputy executive director) on the same day.

As family management continues at Namyang Dairy Products, civic groups have voiced criticism.

The Citizens’ Coalition for Economic Justice (CCEJ) stated in a commentary that there should be an investigation and sanctions against Chairman Hong. The CCEJ criticized, "Chairman Hong promised to put an end to outdated owner management with the 'Bulgaris incident.' He held a tearful press conference saying he would step down from the chairman position and would not pursue aggressive succession of management rights, but it has become clear that these promises were all just a 'show.'"

The CCEJ explained, "Chairman Hong continued to come to work until recently and received 808 million won in compensation in the first half of the year. The eldest son, who was suspected of embezzlement, is active as 'Executive Director in charge of Strategic Planning,' and the second son is active as 'Executive Director and Head of Food Service Business Division.'" They added, "Checks and criticisms from public opinion, as well as proper investigations and sanctions under company law and the Fair Trade Act, have not been sufficiently carried out. Proper investigations and sanctions must be conducted according to relevant laws."

Furthermore, regarding Namyang Dairy Products, following controversies such as pushing out dealerships, the drug use scandal involving the chairman’s nephew, and false advertising claims that their product 'Bulgaris' suppresses COVID-19, the CCEJ evaluated that the company’s behavior is far from the aspiration of becoming the 'world’s best food company' that it proclaims.