A chaebol is a large, family‑owned business conglomerate in South Korea, typically made up of many affiliated companies across different industries. The word comes from the Korean terms chae (wealth) and bol (clan), reflecting the idea of a wealthy family group controlling diverse enterprises. South Korea’s chaebol families – specifically Samsung, LG, SK Group and Hyundai – have built global empires that dominate electronics, automobiles, telecoms, energy, semi-conductors and heavy industry. These four chaebols are believed to generate nearly half of South Korea’s GDP. Yet behind their success lies a complex story of succession disputes, inheritance battles, and governance reforms.

Unlike Western family offices, which are often standalone entities managing wealth outside the operating business, South Korea’s families historically relied on interlocking shareholdings, trusts and charitable foundations to consolidate control. This blurred the line between business operations and wealth management. The challenge is compounded by South Korea’s inheritance tax rate of up to 60%, the highest in the OECD (Organization for Economic Co-operation and Development). Heirs often face multi‑billion‑dollar tax bills, forcing asset sales, restructuring, or borrowing.

The Samsung family faced its most dramatic test after Chairman Lee Kun‑Hee’s death in 2020. His heirs, led by son Lee Jae‑Yong, inherited a fortune estimated at over US$ 20 billion. The family was immediately confronted with an $8.1 billion inheritance tax bill, the largest in Korean history. To meet this obligation, the family had to sell assets and pledge shares, raising questions about whether control could be maintained. At the same time, activist investors like Elliott Management challenged affiliate mergers, arguing they unfairly diluted minority shareholders. The controversy escalated into a political bribery scandal involving the National Pension Service, which approved the merger. Several government officials were jailed and Lee Jae‑Yong himself was imprisoned in 2017.

By this time, Korea had introduced the Korea Stewardship Code in 2016, a corporate governance framework modelled on the Japanese Code introduced earlier in 2014. While compliance to the code was voluntary, the infectious imprisonment flu following the Samsung controversy led to the adoption of the code to protect minority shareholders. The family also consolidated its control through two holding vehicles, Samsung Life Insurance and Samsung C&T.

Across the Seoul expressway, the LG family has long been praised for smoother succession compared to Samsung. Leadership passed to Koo Kwang‑Mo in 2018 after the death of Chairman Koo Bon‑moo. According to an article published in February 2026 in the Korea Times newspaper, Kwang-Mo was adopted into the late chairman’s family in 2004, which was part of LG Group’s custom of passing its top leadership to the eldest son of the controlling family. His biological father is Koo Bon-Neung, the younger brother of Chairman Bon-moo. Yet beneath the surface, disputes simmered.

Chairman Bon‑moo’s widow and her daughters contested the division of the late chairman’s estate, arguing that the inheritance agreement unfairly favoured nephew and cousin Kwang‑Mo, who became the largest shareholder of LG Corp with 15.96% ownership. The case went to court, and in February 2026 the Seoul Western District Court upheld the agreement, confirming the son, Koo Kwang‑Mo’s control. However, the plaintiffs retained the right to appeal, leaving tensions unresolved. Despite the court drama, the LG succession is viewed as much better planned since governance measures had been introduced earlier. These include centralization of control through LG Corp as a holding company as well as professionalization of management, to reduce reliance on family politics.

Further down the Seoul expressway, the Hyundai family, founded by Chung Ju‑Yung, faced fragmentation after his death. With many sons inheriting different affiliates including Hyundai Motor, Hyundai Heavy Industries, Hyundai Department Store, the empire splintered into semi‑independent groups. Disputes arose over cross‑shareholdings and leadership roles, with rivalries weakening cohesion. Korean regulatory authorities investigated opaque ownership structures, further damaging Hyundai’s reputation. Hyundai’s challenge was not just the eye watering inheritance tax, it was family fragmentation, with heirs competing rather than cooperating.

This is where it gets interesting because the wealth diversification tool of investing across multiple industries to reduce concentration risk, ended up creating mini-dynasties. In addition, the use of trusts and cross shareholdings was effective for maintaining influence, but this also fuelled the mini dynasty phenomena and has the potential to erode value in the long term. On the plus side however, operational management was professionalized with family members retaining strategic oversight.

South Korea’s chaebol families show that succession disputes are inevitable when wealth and control are concentrated in dynasties. Holding structures, philanthropy and professional governance have worked to preserve continuity. However, inheritance battles, scandals and fragmented control illustrate the need for transparent succession planning, liquidity strategies and family unity.

For Africa’s emerging family offices, the Korean experience is instructive. As generational wealth transfer accelerates, families must learn to separate wealth management from business operations, plan for liquidity in succession and embrace transparency. Without these measures, disputes can erode even the strongest of dynasties.

X: @carolmusyoka

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