Outline of Affiliate Company Leader Personnel Moves Expected as Early as This Month
With Jeong Shin-a appointed as the new CEO of Kakao, signaling a personnel overhaul, Kakao is considering replacing the CEOs of some affiliates, including Kakao Entertainment and Mobility, which have sparked social controversies.
According to the IT industry on the 16th, the Management Innovation Committee under the CA Council, Kakao Group's control tower, is reviewing a personnel reform plan for affiliate CEOs. The Management Innovation Committee is led by Kim Beom-su, co-chairman of the Kakao CA Council, with Jeong, the newly appointed co-chairman, participating as a standing member. It is known that Kim stepped down from his position as a director of the public interest foundation 'Brian Impact' last November to focus on Kakao's personnel restructuring.
First, the CEOs of key affiliates such as Kakao Entertainment, Mobility, and Games are considered replacement candidates. These are companies that have faced continuous internal and external issues or are led by close associates of Chairman Kim.
The co-CEOs of Kakao Entertainment, Kim Seong-su and Lee Jin-su, were investigated by prosecutors in connection with the SM Entertainment stock manipulation allegations that triggered Kakao's legal risks. Kim is also under investigation for allegedly causing losses to the company by acquiring the drama production company 'Baram Pictures' at an inflated price. Ryu Geung-seon, CEO of Kakao Mobility, has faced ongoing controversies including monopolistic practices in the taxi-hailing market, accounting fraud allegations, and accusations of stealing startup business ideas. Kakao Games, led by CEO Cho Gye-hyun, is currently involved in a lawsuit over its subsidiary XL Games' game 'ArcheAge War,' which is accused of plagiarizing NCSoft's game.
These affiliate CEOs are also considered close associates of Chairman Kim. Kim became a close confidant when he took over as chairman of Kakao's board from Kim Beom-su in 2022. Lee met Chairman Kim during their time at NHN (now Naver) and received investment from Kim when founding Podotree, the predecessor of Kakao Entertainment. Ryu, too, is a former CEO of Danal, invested in by Chairman Kim, and is known as one of the 'Kim Beom-su kids.' Since Chairman Kim has clearly expressed his intention to break away from close-knit management by appointing the externally sourced Jeong as the new leader, there is a high possibility of their replacement.
The Management Innovation Committee plans to finalize the list of CEO replacements as early as this month and submit it to each affiliate's Board of Directors' Nomination Committee. Since the affiliates' shareholder meetings begin in February and March, the Nomination Committees need to review the candidates beforehand, so the personnel outline is expected to be revealed within January. The restructuring is being expedited because a new CA Council can only be formed once the affiliate leaders are decided. On the 2nd, Chairman Kim announced the launch of the new CA Council and stated that subcommittees composed of affiliate CEOs would be established to strengthen group control.
Kakao maintains that nothing has been finalized regarding affiliate personnel changes, but the atmosphere inside and outside the company is unsettled. An internal source said, "Since the announcement of Jeong's appointment was sudden, it is uncertain when the affiliate personnel changes will be announced. Because this is a measure of the will to reform, the scale of replacements could be significant." A startup CEO collaborating with Kakao affiliates said, "I understand that internal issues, including personnel changes, are piling up."
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