[비즈한국] With the parliamentary audit, the "flower of the regular session of the National Assembly," set to begin for three weeks starting next Tuesday (the 6th), Hanwha Aerospace is drawing significant attention from lawmakers. This is because the company currently stands at the center of a defense industry monopoly controversy following its recent attempt to purchase shares and secure management control of Korea Aerospace Industries (KAI), the nation’s only finished aircraft manufacturer.
To make matters worse, a controversy over "hiring discrimination based on academic background" has erupted just ahead of the audit, adding to the company's woes. Although Hanwha Aerospace immediately issued an apology, a motion to summon Kim Dong-kwan, Vice Chairman of Hanwha Group, as a witness to the National Assembly's National Defense Committee has been submitted, raising the possibility that the issue will become a "hot topic" during the audit.
Kim Dong-kwan and others requested as parliamentary audit witnesses
Hanwha Group's expansion of management control over Korea Aerospace Industries (KAI) is expected to go beyond industry interest and become a hot potato during the parliamentary audit.
Hanwha recently increased its stake in KAI to 15.89% and changed its purpose of shareholding to management participation. Hanwha Systems purchased a 3.45% stake in KAI on the market over the past month. With this, Hanwha Group has secured a total of 15.89% of KAI shares, including 9.90% held by Hanwha Aerospace, 4.98% by Hanwha Systems, and 1.01% by Hanwha Aerospace USA. It is now the second-largest shareholder after the Export-Import Bank of Korea, which holds a 26.41% stake.
This is why Hanwha is considered the strongest candidate for acquisition or integration if KAI's privatization is pushed forward by the government in the future. The timing of the stake acquisition also moved faster than market expectations. This has led to speculation that Hanwha may be trying to realize its so-called "K-SpaceX" vision, which combines aerospace and defense businesses.
The problem is that the labor unions of KAI and LIG Defense & Aero (LIG D&A) have revolted against Hanwha Group. Both unions issued a joint statement opposing Hanwha's move to secure management control of KAI and its vertical integration of the defense industry. They stated their opposition, arguing, "The influence of a specific corporate group could become excessively concentrated in core defense sectors ranging from aviation platforms to engines, avionics, armament, and space."
The Korea Fair Trade Commission (KFTC) is also closely monitoring the situation. KFTC Chairperson Han Ki-jeong mentioned in a recent press conference that he would "continuously monitor the abuse of dominant positions by domestic defense companies." Lawmaker Song Young-gil (Democratic Party of Korea, Incheon Yeonsu-gap) also visited KAI's Sacheon headquarters on the 4th and, during a meeting with CEO Kim Jong-chul and the labor union, stated, "We will address the issue of Hanwha Group's KAI stake acquisition during the National Assembly's audit."
Expectations are growing that discussions surrounding Hanwha's increased stake in KAI will continue during the parliamentary audit scheduled for October. Both heads of the companies, Hanwha Group Vice Chairman Kim Dong-kwan and KAI CEO Kim Jong-chul, are already on the list of general witnesses requested for the National Assembly's National Defense Committee. A political insider hinted, "Since the interests of the labor unions are intertwined, I understand there are already plans to question Hanwha Aerospace and KAI regarding this during the audit."
Ministry of Employment and Labor launches labor inspection over "hiring discrimination"
Additional negative news emerged ahead of the audit. A KBS report raised allegations that the company automatically rejected applicants who did not graduate from certain prestigious universities during the hiring process.
The report revealed that when hiring experienced workers on the 9th, Hanwha Aerospace created internal guidelines—not listed in the job posting—that filtered out applicants based on criteria such as "born in 1980 or later" and "graduates of 11 specific universities." After reports exposed evidence that applicants from regional universities and non-preferred schools were systematically rejected at the document screening stage, Hanwha Aerospace finally issued an apology on the 27th.
Lee Boo-hwan, CEO of Hanwha Aerospace, posted an apology on the company website, stating, "It should never have happened that guidelines were created that could restrict applicants' opportunities based on personal conditions such as academic background or age, which are irrelevant to job performance." He promised to strictly warn and discipline the department and individuals responsible for creating and distributing the guidelines, adding, "We are taking this situation very seriously."
The Ministry of Employment and Labor has launched a labor inspection to determine if there were violations of laws such as the Act on Prohibition of Age Discrimination in Employment and the Equal Employment Opportunity and Work-Family Balance Assistance Act. Consequently, the possibility has been raised that Hanwha Aerospace could be put on the chopping block at the Environment and Labor Committee, the relevant National Assembly standing committee that oversees the Ministry of Employment and Labor.
The aforementioned political insider predicted, "As seen in previous hiring scandal cases within the banking sector, the issue of hiring discrimination is something that voters can easily relate to. Since there is significant room for illegality, even if they don't forcibly appoint a Hanwha Aerospace executive as a witness, there will likely be intense questioning demanding a strong response from the Minister of Employment and Labor and others."