Family Control and Succession in Korean Business Groups

Chaebols, Korean family-controlled business groups, must manage and plan for succession. This book analyses their strategies for both inheritance of wealth and transfer of managerial control, looking at institutional and cultural environments, family dynamics, collaboration with professional managers and performance implications.

Chaebols like Samsung are globally recognized Korean business groups under shared family ownership. In the context of significant structural transformations shaped by evolving regulatory pressures in the wake of the Asian Financial Crisis, they faced the pressing question of how to transfer control of their sprawling networks of affiliated companies to the next generation. Focusing on both the inheritance of wealth and the transfer of managerial authority, this book traces how high inheritance taxes, tightening regulation of intra-group transactions and changing corporate governance norms have reshaped ownership structures and leadership patterns in these important economic entities. Sea-Jin Chang advocates a hybrid governance model, using professional managers for the day-to-day management of individual affiliates, while family owners focus on setting the strategic direction and ensuring intergenerational continuity. This collaborative approach allows chaebols to harness the complementary strengths of family stewardship and professional expertise, thereby enhancing corporate governance and supporting long-term sustainability.