"Severance Pay of 5 Billion Won"... High-Salary Employee Rivaling the Chairman

Eunseok Choi, Former CEO of CJ CheilJedang, Received 5.7 Billion KRW
GS Retail and SPC Samlip Also Have Retired Executives with Highest Salaries
Most Companies' Highest Salaries Paid to Family Members of the Owner

Choi Eun-seok, former CEO of CJ CheilJedang, was found to have received the highest compensation among major domestic distribution companies in the first half of this year. In addition to former CEO Choi, some retired chief executive officers (CEOs) received severance pay and earned higher salaries than the owner families.

On the 20th, Asia Economy compiled the first half-year compensation of executives and employees of major distribution companies through the Financial Supervisory Service's electronic disclosure system (DART). Former CEO Choi received 5.734 billion KRW in compensation in the first half of this year. This amount is about three times higher than the 1.828 billion KRW salary received by Sohn Kyung-shik, chairman of CJ Group, from CJ CheilJedang.

The reason former CEO Choi received a higher salary than Chairman Sohn was due to the inclusion of severance pay. He stepped down as CEO of CJ CheilJedang in March and received a total severance pay of 5.37 billion KRW. CJ CheilJedang's severance pay is determined by multiplying the monthly salary by the executive rank's tenure period and then by a multiplier based on the executive rank. After stepping down, former CEO Choi successfully entered the National Assembly as a People Power Party candidate for the Daegu Dong-gu Gunwi-gun Gap constituency in the general election held in April.

At GS Retail, Kim Ho-sung, an advisor who retired upon reaching retirement age, topped the list of highest earners. Advisor Kim received a total of 3.262 billion KRW, including severance pay of 2.725 billion KRW and bonuses of 378 million KRW. This amount is about five times higher than the 627 million KRW salary received by Heo Yeon-su, vice chairman of GS Retail, during the same period. At SPC Samlip, Executive Director Jo Byung-hoon received a total compensation of 610 million KRW, including severance pay of 528 million KRW, making him the only employee in the company to earn more than 500 million KRW.

At Hyundai Department Store, former president Kim Hyung-jong, who resigned in March, received a salary of 1.056 billion KRW. However, this was less than the 1.882 billion KRW received by the owner family member, Chung Ji-sun, chairman of Hyundai Department Store. At CJ, Shin Jong-hwan, a financial expert of the group and former head of the Financial Strategy Office, received 862 million KRW including severance pay of 736 million KRW. He moved to Kakao as the Chief Financial Officer (CFO) in May.

Lee Dong-woo, CEO (vice chairman) of Lotte Holdings, was the highest-paid executive among employees who are not part of the owner family. Vice Chairman Lee received a total of 1.02 billion KRW, including a salary of 605 million KRW and bonuses of 440 million KRW. During the same period, Kim Sang-hyun, CEO (vice chairman) of Lotte Shopping, received 925.9 million KRW, and William Kim and Park Joo-hyung, CEOs of Shinsegae, each received 720 million KRW.

Including salaries from all affiliates, Shin Dong-bin, chairman of Lotte Group, ranked overwhelmingly first. Chairman Shin received a total compensation of 11.789 billion KRW from seven affiliates, including the holding company Lotte Holdings. Notably, he received 4.171 billion KRW in salary from Lotte Holdings alone. Even considering only the compensation received from Lotte Holdings, Chairman Shin ranks second among all employees of distribution companies.

More than half of the salary Chairman Shin received from Lotte Holdings, amounting to 2.17 billion KRW, was a performance bonus. Lotte Holdings explained the reason for calculating Chairman Shin's performance bonus as "considering his discovery of future new growth areas from a mid- to long-term perspective and his contribution to enhancing business competitiveness through the advancement of the business portfolio."

Chairman Shin topped the salary list in most affiliates. He received 1.101 billion KRW and 2 billion KRW from Lotte Shopping and Lotte Chemical, respectively. Additionally, he earned 1.314 billion KRW from Hotel Lotte, 1.112 billion KRW from Lotte Wellfood, 1.499 billion KRW from Lotte Chilsung Beverage, and 592 million KRW from Lotte Corporation.

In major distribution conglomerates, the owner families mostly held the highest salary positions. At E-Mart, Chung Yong-jin, chairman of Shinsegae, received 1.72 billion KRW, and at Shinsegae, Chung Yoo-kyung, general manager, received 1.714 billion KRW, the highest compensation. Lee Jae-hyun, chairman of CJ Group, received 2.191 billion KRW from the holding company CJ, and Chung Ji-sun, chairman of Hyundai Department Store, received 1.882 billion KRW through Hyundai Department Store. Hong Seok-jo, chairman of BGF Retail (571 million KRW), Shin Dong-won, chairman of Nongshim (787.8 million KRW), and Kim Jung-soo, vice chairman of Samyang Foods (626 million KRW) also received the highest salaries within their companies.