Farm cooperative to downsize operations, enhance accountability

SEOUL, Dec. 8 (Yonhap) -- South Korea's scandal-plagued farm cooperative said Monday it will sell or reorganize nine affiliates to streamline overall operations and enhance transparency.

The National Agricultural Cooperative Federation, or Nonghyup, said it plans to
reduce the number of its affiliates from 25 to 16 by 2010 as it moves to adopt a
holding company arrangement for its financial and agriculture-support operations.
The decision comes after President Lee Myung-bak last week blasted the giant
organization of 2.4 million members for gross inefficiency, political maneuvering
and corruption of senior executives.
The past three chairmen have all gone to jail for corruption, with one implicated
in a case involving possible kickbacks given to the brother of former President
Roh Moo-hyun.
The plan agreed upon at an emergency meeting of executives calls for merging
Korea Agricultural Cooperative Marketing with three other regional distributors
while consolidating its securities, futures and asset management firms into a
single unit.
Nonghyup executives also said that 11 senior executives will be laid off starting
next year, with salaries of all employees to be frozen for this year and 2009.
The cooperative's current head, Choi Won-byung, announced earlier in the day that
he is willing to revamp the office of the chairman to remove excess authority.
The Ministry for Food, Agriculture, Forestry and Fisheries, which exercises
control over Nonghyup, said it plans to push reforms limiting the authority of
the chairman to select CEOs of affiliates and other executives. It also wants to
make the auditing bureau an independent body to better monitor operations.
It said a new reform bill that emphasizes greater transparency will replace
measures being reviewed by the Government Legislation Office.
The ministry said it will push to pass the new law early next year.
yonngong@yna.co.kr