Conglomerates reluctant to promote executives as uncertainty grows

Trade risks, weak domestic demand pose growing threat to big companies

By Lee Min-hyung

Major Korean conglomerates were hesitant to promote their executives to higher-ranking positions in their end-of-year reshuffle as they have to navigate an uncertain trading environment next year in the face of the incoming Donald Trump administration, according to data and industry officials on Tuesday.

Most of the big companies have also adopted a conservative management stance amid looming fears of a global economic downturn. They avoid taking risks, instead prioritizing stable corporate management during this period of global geopolitical uncertainty.

According to data from corporate tracker Leaders Index, the number of employees promoted to executive-level positions came in at 1,021 in 2024 among the nation’s top 30 conglomerates by assets, down 9.6 percent from the previous year.

The figure for executives promoted to president or higher-level positions almost halved to 24 from 43 during the same period. Of particular note is that only four executives were promoted to vice chairman, down 63.6 percent from the previous year.

This was because most conglomerates, such as Samsung, SK, Hyundai and LG, strategically focused more on stabilizing their management structure in preparation for growing market uncertainties here and abroad.

“Companies are faced with the double blow of sluggish domestic demand and heightened trade risks in an upcoming era of U.S. President-elect Donald Trump,” an official from a conglomerate said.

“This pushes fewer companies to embrace any large-scale management shake-up. They, instead, choose to maintain stability by minimizing changes in their organizational structure and seek to heighten vigilance against any internal and external risk factors.”

Out of the top 10 conglomerates, Hanwha Group reported the sharpest fall in the number of those promoted to executives for the first time and to high-ranking executives. A total of 62 executives were promoted from the group’s 13 affiliates this year, down 37.4 percent from a year earlier.

GS Group, Lotte Group and HD Hyundai followed with declines of 33.3 percent, 22 percent and 12.2 percent, respectively.

Top-tier conglomerates also jumped on the bandwagon to brace for next year's escalating market uncertainty. LG Group also reported a fall of 11.9 percent in the number of promoted executives. A total of 75 executives were promoted for SK Group this year, down 8.5 percent during the same period.

The figures for Hyundai Motor Group and Samsung Group also came in at 239 and 260, respectively, down 5.5 percent and 1.9 percent from a year ago.