"Do You Know Who I Am?"... The Unresolved Abuse of Power Assault [The Editors' Verdict]

Joyworks CEO, HOKA's Exclusive Distributor in Korea
Allegations of Assault Against Subcontractor Employees Spark Controversy
Time to Reexamine Performance-Driven Organizational Culture

A violent incident that erupted in the fashion industry at the very beginning of the new year has sent shockwaves through the sector. The CEO of a company that imports and sells the global running shoe brand HOKA is alleged to have summoned the CEO and an employee of a subcontractor to an abandoned building in Seongsu-dong, Seoul last year and assaulted them. In a recently released audio recording, Cho Sunghwan, former CEO of Joyworks&Co and the alleged perpetrator, can be heard shouting at subcontractor representatives, "Do you know who I am?" while apparently assaulting them.Cho claims that the incident was a "mutual assault" that occurred during a meeting he called to warn the subcontractor's employees, who he says were spreading false information about him.

The truth of both sides' claims will be revealed through the police investigation.However, the subcontractor's assertion that they turned on the voice recorder on their mobile phone because the meeting place Cho suggested for "a meal and a conversation" turned out to be an abandoned building, appears credible. In an apology, Cho stated, "I am well aware that there is no justification for the use of physical force under any circumstances, but I failed to control my emotions in the moment and committed an irreparable mistake," and stepped down from his position as CEO.

Although Cho admitted, "This incident is entirely my personal fault," the fact that scenes reminiscent of gangster movies are still playing out in real life highlights the structural malaise of authoritarianism in our society. From the 2007 Cheonggyesan revenge assault by Hanwha Group Chairman Kim Seung-youn to the 2010 baseball bat beating of a delivery worker in his 50s by Choi Chulwon, a member of the SK Group family (the so-called "beating over delivery fee" case), the 2016 assault on a security guard by former Mr. Pizza Chairman Chung Woo-hyun, and the 2018 video of Korea Future Technology Chairman Yang Jin-ho assaulting his employee, such "gapjil" (abuse of power) assaults keep recurring whenever they are on the verge of being forgotten.

Gapjil assaults are not limited to physical violence. Any act that uses a superior position in a power relationship to oppress and control the other party falls under this category. Underlying it all is the same mindset as Cho's statement: "Do you know who I am?" It is a culture of "gapjil" in which individuals demand recognition and obedience from others by flaunting their status or background. The various controversies surrounding Kim Byungki, former floor leader of the Democratic Party, are likely not unrelated to this culture.

This incident should prompt our society to reflect on whether we have been condoning a culture of gapjil under the pretext of "performance" and "results." Cho previously served as co-CEO of Joyworks, which signed a domestic distribution contract with Deckers, the U.S. headquarters of the HOKA brand, and its subsidiary Joyworks&Co. Founded in France in 2009, HOKA specializes in running shoes that emphasize functionality, such as thick midsoles (cushioning), lightness, and stable fit. In 2013, it was acquired by Deckers in the United States.

Joyworks has been the domestic distributor of HOKA since 2018, and the brand has experienced rapid growth in Korea following the shift to a COVID-19 endemic (periodic outbreaks), fueled by a marathon boom. Joyworks' sales, which were first reported in its 2022 audit, reached 22.8 billion won, then doubled to 43.3 billion won the following year, and are expected to reach 82 billion won in 2024. Following the recent assault incident, the stock price of Joyworks&Co, a KOSDAQ-listed company acquired by Joyworks last year and holder of HOKA's offline sales rights, has plummeted. Cho contributed to these achievements.

Previously reported gapjil assault cases have resulted in both public condemnation and criminal punishment. With technological advances, recording conversations on mobile phones has become commonplace, making "gapjil risk" a constant management concern. As consumers shift toward "value consumption," ESG (environmental, social, and governance) factors such as environmental protection, human rights, labor, and gender sensitivity have become the standards for consumption. If companies fail to recognize these changes, the market will turn its back on them without hesitation.