[Edaily Marketin KIM SUNG-SOO Reporter] Attention is focused on whether the Korea Investment Corporation (KIC) will appoint a dedicated Chief Investment Officer (CIO) next year to lead domestic strategic investments as part of its efforts to grow into a “Korean-style Temasek.”

This move is part of KIC’s plan to transition from a sovereign wealth fund focused on overseas investments to one that also takes on the role of investing in domestic strategic industries, requiring the establishment of a separate investment leadership structure. However, since this depends on amendments to relevant laws, the actual timing of the appointment will depend on the National Assembly’s legislative schedule.

Bill Proposed to Create a New CIO Position “Exclusively for the Strategic Investment Account”

According to the National Assembly and the financial investment industry on the 2nd,

a partial amendment

to the Korea Investment Corporation Act—sponsored by Democratic Party of Korea Representative Kim Tae-nyeon in late September—includes provisions for a separate Chief Investment Officer (CIO) for

the Strategic Investment Account

. The intent is to create a new CIO position dedicated to domestic strategic investments, entrusting that individual with investment decision-making and management responsibilities.

Currently, there is not a single specialist within KIC responsible for domestic direct investment. This is because, under current law, KIC has managed its assets under management exclusively as overseas foreign currency assets, so it has not maintained a separate staff dedicated to domestic direct investment.

Accordingly, if the legislative amendment is finalized as drafted, KIC plans to recruit the necessary personnel and expand its organizational structure. The plan is to establish a separate system with an investment officer responsible for managing the Strategic Investment Account and to fully launch its domestic investment operations.

The amendment specifies the qualification requirements for the director in charge of investments. According to the newly added Article 16, Paragraph 3, the director in charge of investments for the Strategic Investment Account must have a combined total of at least 10 years of experience, consisting of “the investment experience specified in Paragraph 2 of the same Article” and “work experience in strategic industries.”

Paragraph 2 stipulates that “the Corporation’s director in charge of investments must be a person who has engaged in investment operations for at least 10 years at a domestic or foreign financial institution or international financial organization of a certain scale or larger, as prescribed by Presidential Decree.”

Since the bill requires the CIO in charge of strategic investments to also have work experience in strategic industries, this is interpreted to mean that not only “financial investment expertise” but also “understanding of the industrial sector” will be taken into consideration.

The appointment procedure is also included in the amendment. Broadly speaking, the process consists of: △ a recommendation by the Investment Director Nomination Committee (chaired by the KIC President); △ deliberation by the Steering Committee; and △ appointment by the President.

First, the Steering Committee establishes an Investment Director Nomination Committee to recommend candidates for the position of investment director. The Investment Director Nomination Committee is chaired by KIC President Park Il-young; after the committee recommends candidates, the Steering Committee reviews them, and the President makes the final appointment.

Passage of the bill is a prerequisite… If enacted this year, the appointment process will begin next year

. Candidate recruitment must follow an open procedure. The Investment Director Nomination Committee must publish a notice recruiting candidates for the position of investment director in major daily newspapers.

Separately, the committee may directly vet candidates deemed suitable or commission professional organizations to conduct such vetting. If the bill is finalized as drafted, it is expected that the search for suitable candidates will proceed through a combination of open recruitment and separate candidate identification efforts.

The size of the Steering Committee will also be expanded. The amendment establishes a committee to recommend candidates for investment directors while increasing the maximum number of Steering Committee members from the current “no more than 12” to “no more than 15.”

The existing Steering Committee consisted of “three ex officio members” and “six private-sector members”; the limit on private-sector members has been raised from “up to six” to “up to nine.” This is to fill positions with professionals with experience in strategic industries.

While the eligibility requirements for existing private-sector members previously referred only to research or work experience in the “finance and investment sectors,” the amendment has expanded this to include the “finance, investment, and strategic industries sectors.” This effectively revises the decision-making framework regarding the appointment of the Chief Investment Officer (CIO) in line with the establishment of the Strategic Investment Account.

However, for the appointment of a CIO in charge of strategic investments to actually take place, the bill must first pass through the National Assembly. During the parliamentary audit held last month by the National Assembly’s Finance, Economy, and Planning Committee, no specific questions were raised regarding the appointment of a separate CIO for the strategic investment account. The final content of the bill and the legislative schedule also remain fluid.

The bill is expected to pass no sooner than the end of this month or next month. If the legislative process is completed by the end of this year, KIC plans to begin the process of appointing a CIO for strategic investments early next year. Conversely, if the bill’s passage is delayed or its provisions are amended, the organizational structure and the schedule for appointing the CIO will inevitably be affected.

A financial investment industry official stated, “Ultimately, KIC’s vision of becoming a ‘Korean-style Temasek’ is expected to take shape based on how the individual in charge of domestic strategic investments is appointed and what authority and responsibilities are granted to them,” adding, “Since the goal is to launch strategic investments next year, whether the bill establishing a separate CIO position can clear the National Assembly early will be a key variable.”