새마을금고의 건전성 제고방안

Abstract

The periodic occurrence of Community Credit Cooperative’s problem is attributed to its weak governance structure and internal control issues. This article discusses ways to enhance the soundness of Community Credit Cooperatives and focuses on improving its governance structure and supervisory system. Both the regional credit cooperatives and the federation of Community Credit Cooperatives (hereinafter ‘the federation’) have a common body called the board of directors and the general assembly (representative assembly), while the audit committee is unique to the federation. The authority of the chairman of the federation is quite strong, making it crucial to have the roles of the board of directors, general assembly, and audit committee strengthened to check this authority. Regarding the audit committee, it was revised in 2019 to enhance its independence. Therefore, this article discuss ways to strengthen the roles of the board of directors and the general assembly in relation to improving Community Credit Cooperative’s governance structure. To strengthen the role of the board of directors, its independence and expertise need to be enhanced. This can be achieved by reinforcing the qualifications for full-time directors and tightening the disqualification criteria for executives. Furthermore, enhancing the expertise of directors through the expansion of performance evaluations is necessary. Additionally, to strengthen the responsibility of executives, the internal control standards should be reinforced, and one possible measure is to adjust the level of sanctions for violations of internal control standards upward. Addressing persistent issues in the internal control regulations, such as split loans and private transactions, through being prescribed in legislation could help improve officers’ and employees' awareness of internal control standards. To strengthen the role of the general assembly, it needs to be activated. To activate the general assembly, this requires empowering the members' participation rights, and the rights of members to know, which are the premise of the rights to participate, must be guaranteed. To ensure the guarantee of members' rights, Community Credit Cooperative’s obligations to provide information and disclose information must be strengthened. Additionally, to enhance members' participation rights, there is a need to revise the Community Credit Cooperatives Act to allow members to receive documents electronically and exercise their voting rights electronically. Moreover, to enable active exercise of voting rights by members, pre-meeting reference documents for the general assembly should be provided. Next, regarding the reorganization of Community Credit Cooperative’s supervisory system, it is necessary to change the responsible agency for Community Credit Cooperatives to the Financial Services Commission (hereinafter ‘FSC’). The change of the responsible agency is related to the internal control of Community Credit Cooperatives. Considering that the main business of the Ministry of Public Administration and Security (hereinafter ‘MPAS’) is not in finance and that the regular comprehensive audits of the federation by the MPAS are conducted every two years, the current audit method may not be an effective means of preventing Community Credit Cooperatives’ insolvency in advance. Therefore, there is a need to change the responsible agency for Community Credit Cooperatives to the FSC.