Shinsegae Siblings Diverge in Executive Appointments

Shinsegae Group's executive appointments for 2027 reveal a split strategy between siblings Chung Yong-jin and Chung Yoo-kyung.
 
Chung Yong-jin has taken direct control of E-Mart and initiated significant management changes, while Chung Yoo-kyung has opted to retain key executives in the department store division, emphasizing stability.
 
The siblings, who are pursuing a corporate split, have adopted different personnel strategies tailored to their respective business situations.
 
On October 23, Shinsegae Group announced its 2027 executive appointments, focusing on strengthening Chung Yong-jin's accountability and performance-based management.
 
The most notable changes occurred in the E-Mart division. After being appointed CEO of Shinsegae Property in June, Chung Yong-jin was also named CEO of E-Mart.
 
Following the upcoming shareholders' meeting, he will officially assume the role alongside newly appointed CEO Kim Hong-guk, operating under a dual CEO system.
 
As Shinsegae Group aims to evolve from its retail roots into a comprehensive life, content, and entertainment company, Chung Yong-jin's leadership is deemed crucial.
 
In the field of artificial intelligence (AI), the group is collaborating with Reflection AI, Aman Group in real estate development, and SkyDance in content.
 
Shinsegae Group stated, "Chung Yong-jin is poised to lead the group's transformation during this industrial shift centered around AI."
 
Kim Hong-guk, the newly appointed CEO of E-Mart, will also serve as CEO of SSG.com. He is recognized as a product planning (MD) and sales expert, having previously held positions such as head of the product division at E-Mart. His selection as a key affiliate leader follows his success in turning Shinsegae TV Shopping profitable and improving Shinsegae Casa's profitability.
 
Assigning both E-Mart and SSG.com to a single professional manager is seen as a move to extend the competitiveness of the offline business into the online realm. This is particularly significant as SSG.com prepares for a corporate split in December, which is expected to accelerate collaboration and profitability improvements across businesses.
 
SSG.com plans to undergo a corporate split in December, dividing into a shopping-focused entity and a new company centered on fashion and beauty, named Shinsegae Mall. In August, E-Mart invested 827.5 billion won to secure a stake from financial investors, raising its ownership to 65.1% (with Shinsegae holding 34.9%).
 
However, under fair trade laws, family members must reduce their cross-holdings in unlisted affiliates to a certain level for the corporate split, necessitating further adjustments.
 
The group's management strategy office has also been reorganized. Choi Taek-won, CEO of SSG.com, has been appointed to oversee management support, while Park Seung-hak, head of leisure at Chosun Hotel & Resort, has been appointed to lead external relations.
 
Vice President Jeon Sang-jin remains in his role, but no announcement has been made regarding the appointment of a new head of the management strategy office, which has been vacant since April.
 
Analysts suggest that Chung Yong-jin's direct involvement in management is partly due to performance discrepancies between E-Mart and its subsidiaries.
 
In the first half of this year, E-Mart's standalone operating profit rose 15.4% year-on-year to 171.9 billion won, while consolidated operating profit fell 25.2% to 135.3 billion won. Improving the profitability of subsidiaries like SSG.com remains a challenge.
 
In contrast, Chung Yoo-kyung has maintained key executives in the department store division.
 
There were no changes among the core leaders, including Park Joo-hyung, who was promoted to president of Shinsegae last year, Lee Seok-gu, CEO of Shinsegae DF, and Moon Seong-wook, CEO of Shinsegae Live Shopping.
 
The stability in the department store division is believed to be supported by improved performance.
 
Shinsegae's consolidated operating profit for the first half of this year reached 365 billion won, a 75.7% increase compared to the same period last year. Shinsegae International and Shinsegae DF have also returned to profitability, reflecting the results of personnel changes made last year.
 
However, organizational restructuring aimed at enhancing business expertise has been implemented. Shinsegae International has been reorganized into a fashion division and a cosmetics division, with Kim Deok-joo appointed to oversee the fashion business.
 
The cosmetics division will be led by Heo Min-ho, the newly appointed CEO of Shinsegae Casa, who previously served as CEO of CJ Olive Young for a decade.
 
While Chung Yong-jin has made changes to key affiliates and the group's strategic organization, Chung Yoo-kyung has opted to maintain the existing management structure while strengthening expertise in the fashion and cosmetics sectors.
 
Overall, the group has accelerated generational change. This appointment cycle saw a record 36 new executives appointed, with the proportion of executives in their 40s reaching an all-time high of 18%.
 
Shinsegae Group plans to continue conducting personnel changes based on performance and capabilities. The group aims to pursue organizational innovation as it advances into new businesses such as AI, content, and entertainment.
 
A Shinsegae Group representative stated, "We will maximize our core business competitiveness through talent discovery based on performance and achieve results in future growth sectors."