Confront — not fear — the witness stand

Korean CEOs also must be able to frankly testify on the complications and challenges in the business environment to properly find solutions for them.

Park Su-ryeonThe author is head of the industry news department at the JoongAng Ilbo. The first state auditing season has arrived for the 22nd legislature formed in late May. From the witness list compiled by 15 standing committees, the JoongAng Ilbo discovered that 159 among 470 names are chairmen or part of the C-suite of companies, morr than last year’s toll of 95.

Businessmen will have to play the same old charade, waiting around for more than seven hours to answer a few simple questions lasting just a few minutes. Corporate personnel responsible for dealing with state and legislative affairs have to scramble from early in the morning to lessen the trouble for their bosses. Why does the legislature impose this annoyance on corprate leaders every year?

Lawmakers squeeze in a year’s worth of queries on government and state-administered offices during the annual audit period of about two weeks. They cram business tycoons into the tight schedule to scorn them as if it is part of a ritual despite producing little meaningful results. Many have long suggested shifting the annual audit system to a session happening on a regular basis or whenever needed. But we hardly can expect any change from the National Assembly entirely engrossed in partisan interests.

If they can’t avoid it, business chiefs should try to make the most of it. Since they cannot refuse the call from the representatives, they should prepare well to use their time on the mic for a persuasive pitch to legislators as well as the people.

Paik Jong-won, the owner of franchise The Born Korea and a celebrity cook, seized the moment during his testimony in 2018. When a lawmaker accused his franchises of stealing customers from mom-and-pop stores to kill them, Paik strongly refuted it and corrected the facts. He argued that independent merchants run into trouble after starting a dining business — not because of franchise dominance but because eatery permits are given so easily regardless of whether a restaurant is ready to open. Many agreed with Paik after his comment.

Lee Hae-jin, founder of internet giant Naver, is a regular to the witness stand, and he is vocal during the sessions. After enduring scorn over Naver’s dominance in the platform business sector during a session in 2021, he promised to pay heed to lawmakers’ words but also demanded they do their part. He pointed out that strengthened regulations only apply to domestic companies, which can cause reverse discrimination in competition with multinational players. Lee’s argument raised awareness on global platform operators who dodge various domestic regulations and taxes under the excuse of basing their servers outside Korea.

How could the two CEOs talk back? Is it because they were relatively safe from the stigma of illicit hereditary succession or profiteering ways related to conglomerates? We cannot know. But if a business manager has long deliberated on the challenges in his or her trade and ways to improve, he or she should not fear facing lawmakers or the public via TV cameras.

But what we see on TV are stone-faced businessmen who apologetically bow their heads. That’s the face of Korean business — and yet they look small compared to lawmakers. It might not be their fault. Lawmakers can point out the flaws and wrongdoings in the corporate sector, but their condescending and bullying tone to get the answers they want cannot be the purpose of the hearing.

As long as politicians think they must be hard on companies — and believe that provoking anti-business sentiment is a way of enacting justice — corporate leaders will wish to avoid legislative questioning as much as possible. Businessmen should not try to hide themselves or keep low when their decisions can affect consumers and economic participants.

In the United States, Congress holds a hearing whenever necessary and calls upon CEOs over pending issues. Meta CEO Mark Zuckerberg was summoned many times over questions about opinion-rigging during the presidential election, leaks of private information, and how his social network platforms affect young people. Although the questions were harsh, Zuckerberg fully spoke on behalf of his company and online business. The tech bosses of the four big-tech names — Google, Apple, Amazon and Meta — were called to a Congressional hearing on anti-monopoly issues in 2020 and defended themselves. In a testimony before the legislature in May last year, OpenAI CEO Sam Altman warned of AI employment in manipulating voters and disinformation and called for regulatory steps.

The CEOs summoned to Congress gladly grabbed the opportunity to speak their thoughts before an American and global audience. Korean CEOs also must be able to frankly testify on the complications and challenges in the business environment to properly find solutions for them. We hope stars can be born in the latest round of audit session.

Translation by the Korea JoongAng Daily staff.