[Beyond the Field] Where the CEO of Nonghyup Distribution Should Be Headed

Donggeun Lee, CEO of Nonghyup Distribution

Only 4 On-Site Management Trips in 20 Months

Visits Concentrated in Busan and Jeonju

Two Overseas Trips in Three Months

The path King Jeongjo, the 22nd monarch of the Joseon Dynasty, took to pay respects at the royal tombs also served as a venue for his subjects to express their grievances. The people would strike a gong in the king’s presence to make their stories heard. Voices difficult to hear within the palace were delivered on the road. Where a leader is headed and whose opinions he listens to has always been of great importance, both then and now.

Donggeun Lee, CEO of Nonghyup Distribution, is under a special audit due to suspicions regarding overseas travel expenses. The issue arose from an internal report alleging that funds raised through unnecessary construction projects were used for personal trips to Japan and Mongolia unrelated to company work. The CEO and the company countered, claiming the trips were made at personal expense and that no company funds or construction-related money was used. Taking a private trip is not worthy of criticism in itself. However, taking two overseas trips within three months, each accompanied by two other executives or employees, defies common sense.

Furthermore, Nonghyup Distribution recorded operating losses for four consecutive years up to last year. The cumulative losses amount to 101.9 billion won. According to data disclosed last year at a parliamentary audit by Assemblyman Heehyong Chung of the People Power Party, half of all branches were operating at a deficit. Since the beginning of this year, after making two overseas trips with staff, how much time has the CEO spent meeting with customers and store employees?

According to business trip records for the CEO of Nonghyup Distribution, obtained by the office of Assemblyman Jaegwan Lee of the Democratic Party of Korea, who sits on the National Assembly’s Agriculture, Food, Rural Affairs, Oceans, and Fisheries Committee, the CEO took 17 domestic business trips during the 20 months from last year to August of this year. Duplicate entries with the same date, purpose, and destination were counted as a single trip. Seven trips were related to board activities, such as meetings in advance of new director appointments and temporary board sessions. There were three trips for meetings and visits with local Nonghyup branches, two for volunteer service, and the remaining five were recorded as either field management activities or business trips to the Busan region.

Business trip records alone cannot fully reflect the CEO’s field activities. There may have been store visits not claimed as business trips. However, among the records submitted by a company that operates 38 Hanaro Mart stores nationwide, only four schedules were explicitly listed as “field management.” Three times he visited the Busan area; once, the Jeonju branch. A separate “Busan region business trip” entry listed the destination as the Gyeongju Training Institute. Both the number and areas of field management activities indicated in the records were limited in scope.

It is the CEO’s job to explain agenda items at the board and coordinate with local Nonghyup offices. Volunteer work in rural areas is meaningful as well. Yet there is another important role at the store. The CEO must hear first-hand why products are not selling, why customers are going elsewhere, and what changes employees wish to see. These are issues that can’t be fully understood from meeting materials alone.

To identify the root causes of mounting deficits and change management practices, a CEO must understand both the numbers and the situation on the ground. The reasons for customer decline and staff difficulties can differ at each branch. For a leader discussing organizational integration and cost reduction, visiting stores is essential for collecting the information needed for management decisions. Hanaro Mart connects farmers supplying agricultural products with consumers purchasing them, and there are employees working in between. What the CEO must pay attention to is how well the needs of these people are reflected in store operations and restructuring processes. The place the CEO most needs to visit is the sales floor, where customers with shopping baskets gather.

Customers are shopping at the Hanaro Mart Yangjae Branch in Seocho-gu, Seoul, on the 10th. August 10, 2026. Photo by Jinhyung Kang

This content was produced with the assistance of AI translation services.