Affirmative Action and Corporate Compliance in South Korea

Abstract

The Affirmative Action Act was introduced in South Korea in 2006 to increase female employment and correct discriminatory hiring practices. Using the combined data sets of survey and the Act's implementation plan, this paper provides logit estimation results to examine empirically how political perceptions or attitudes of firms influence corporate noncompliance with the Act. According to a corporate personnel manager survey, affirmative action was initially pursued as a campaign pledge by the liberal party (the Korea Democratic Party) to attract women's votes, and took on a looser shape as the government compromised with the business sector after an election. A weak enforcement structure ultimately diluted the effects of the Act. A logit analysis indicates that noncompliance is more probable in companies that perceive affirmative action as part of a design to achieve political goals, and compliance is more probable in companies that feel it is likely to improve corporate management.