The country’s authorities via the Financial Services Commission (FSC), South Korea’s top financial regulator, are calling on State financial institutions to implement performance related pay structures in a bid to boost performance and balance the financial books. Even if the FSC believes this measure is necessary to maintain competitiveness against the sluggish economic backdrop, trade unions are vigorously opposed to the move. The reform is coming at a time when two banks are being accused of badly handling the economic crisis, which is impacting the shipbuilding sector.
For the moment, the new system will only apply to the leaders of these bodies. Yim Jong-yong, FSC president has called on the public sector financial institutions to “reform how they operate and adopt the principle of meritocracy as a way of winning back the public’s confidence.” For Yim Jong-yong, the general public currently considers these institutions as “golden holding-bay havens for former civil servants coming up to retirement.”
By way of incentive, the FSC has promised a bonus equivalent
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