South Korea’s retail giant Shinsegae Inc. on Wednesday carried out one of its most drastic executive reshuffles, replacing chief executives of its two business pillars, E-Mart Inc. and Shinsegae Department Store, and other subsidiaries.
The personnel changes, which include the reshuffle of other key affiliate CEOs, come as Shinsegae Group, the country’s 10th-largest conglomerate, is reeling from falling sales and weak share prices amid the economic slowdown.
Han Chae-yang, CEO of Josun Hotels & Resorts Co., has been named to lead E-Mart and its e-commerce unit SSG.COM, replacing the incumbent Kang Heui-seok.
Kang, known in the industry as group Vice Chairman “Chung Yong-jin’s man,” was supposed to complete his term at the end of 2026. Formerly a Bain & Company consultant, he was tapped as E-Mart's CEO in October 2019.
Han Chae-yang, CEO of Shinsegae's E-Mart and SSG.COM Han, the new E-Mart leader, will also head two affiliated offline distribution channel operators, E-Mart Everyday Inc. and E-Mart24 Inc.
Park Ju-hyung, chief of Shinsegae Central City, the group’s property development affiliate, has been named to concurrently lead Shinsegae Inc., the operator of Shinsegae Department Store, replacing the incumbent Son Yung-sik.
UNDER PRESSURE
The two outgoing CEOs – Kang and Son – have been under pressure to leave since last year amid declining sales.
Shinsegae Central City CEO Park Ju-hyung will also lead Shinsegae Inc., the operator of Shinsegae Department Store Industry watchers said Shinsegae Group Chairwoman Lee Myung-hee made a bold decision to prevent the deteriorating business performance from affecting other subsidiaries.
“This is a quick decision-making in response to signs of crisis, such as worsening performance of major affiliates and falling stock prices following the acquisition of G-Market,” said a group executive.
Shares of E-Mart were trading 0.3% lower at 73,300 won late Wednesday on the main bourse. The stock has fallen 39% from a high of 119,900 won in mid-February.
In the first half, E-Mart swung to 39.3 billion won ($30 million) in operating losses on a consolidated basis from a year ago. Sales increased a mere 1% on-year to 14.41 trillion won.
Shinsegae Inc. saw its first-half sales and operating profit fall 13% to 3.63 trillion won and 302 billion won, respectively.
RETAIL CLUSTER & CONCURRENT POSITIONS
This year’s annual executive reshuffle, which comes about a month earlier than usual, saw the creation of a retail cluster, a control tower that controls Shinsegae Group’s six retail businesses – E-Mart, E-Mart Everyday, E-Mart24, Shinsegae Property, SSG.COM and G-Market.
Another noteworthy aspect of this year’s changing of the guard, which affected nearly 40% of affiliate CEOs, is the increase in the number of chief executives in charge of multiple group subsidiaries.
Shinsegae Food Co. CEO Song Hyun-suk will also become the chief executive of Shinsegae L&B Co., which operates wine shops under the Wine & More brand in Korea.
Shinsegae Property CEO Im Young-rok will also lead Josun Hotels & Resorts.
Some other new CEOs include Shinsegae Live Shopping Chief Executive Lee Seok-koo, who previously led Starbucks Korea for 11 years.
Kim Hyun-woo has been hired from outside Shinsegae to lead Mindmark Inc., a subsidiary specializing in content production. Lee Ju-chul, a former G-Market executive, has been tapped as CEO of W Concept, a fashion mall operator.
“Through this personnel reshuffle, we expect to better cope with the current business difficulties,” said a group official.
