Having lived and worked in Korea as an expat for over two decades, I have observed a phenomenon that initially appeared counterintuitive from my perspective.

Throughout my experience here across numerous industries, on multiple occasions, when a company has been acquired or received a material investment, one of the first priorities of the founders on cashing out is often the purchase of property or accumulation of fixed assets rather than the reinvestment of capital into business expansion, innovation or new opportunities.

From a Western business perspective, this may appear somewhat limiting, as a liquidity event often represents an opportunity to redeploy capital into additional growth or wealth enhancement. However, over the course of my time in Korea I have gradually come to better understand the historical, cultural and structural factors behind this tendency.

One factor is the differing perception of leverage and "productive debt." In many Western economies, particularly amongst entrepreneurial and investment circles, leverage with liquidity is often viewed as a strategic tool when applied responsibly. The prudent use of owned plus borrowed capital can accelerate growth, increase productivity and create significant enterprise value. Many of the world's largest companies and fortunes were built through effective capital deployment rather than ownership alone. Optimal leverage has even paved roads for recent presidencies.

In Korea the concept of leverage as a growth mechanism has historically been approached with greater caution and, in some respects, skepticism — not only from a socioeconomic perspective but also psychologically and institutionally. This is not to suggest that Koreans are unfamiliar with debt; rather, the distinction lies in how leverage is traditionally utilized, with greater emphasis often placed on asset preservation, tangible ownership and financial security.

This cultural emphasis on ownership is reflected in broader social trends. According to OECD research, 51.2 percent of young Koreans believe owning a home is a prerequisite for marriage, even as housing affordability has deteriorated significantly over the past decade. In contrast, many high-net-worth individuals in the United States may intentionally choose to rent rather than purchase properties, viewing preserved capital as an opportunity cost that can be allocated toward potentially higher-return investments.

In today's era of shared economies, outsourcing, digital outlets and increasingly asset-light business models, the relationship between ownership and value creation is evolving. Many of the world's most successful companies generate substantial enterprise value through technology, intellectual property, partnerships, and efficient capital allocation rather than physical ownership alone.

Nevertheless, there remains a strong sense of comfort and security associated with tangible ownership in Korea. This preference extends beyond individuals to corporate structures, where controlling shareholders may prioritize maintaining ownership and control, sometimes even at significant economic cost and sacrifice.

To be fair, there are understandable reasons behind this behavior. Korea has historically operated within a highly competitive and mature marketplace where opportunities for material growth may appear comparatively limited. In a near zero-sum environment, preserving wealth through physical assets can seem like a more rational strategy.

However, as borders expand, barriers diminish and global opportunities continue to emerge for the next generation of Korean entrepreneurs and businesses, the effective deployment of capital will become increasingly important. A healthy balance of ownership, sustained growth and calculated borrowing can provide the necessary combination of ambition and discipline to strengthen Korea's economic ecosystem.

This should not be interpreted as an argument that greater leverage is inherently positive. Productive leverage must be clearly distinguished from speculation. Economists generally differentiate productive debt from speculative or consumption debt. When responsibly allocated, credit can facilitate innovation, investment and productivity.

Conversely, Korea's stock and property markets have demonstrated periods of excessive leverage, particularly during times of optimism and volatility. This is fundamentally different from productive capital deployment. Excessive borrowing can result in unnecessary exposure and undue risk, effectively gambling away resources.

Korea continues to maintain one of the highest household debt ratios among advanced economies, with a significant portion linked directly or indirectly to housing. Elevated household debt can constrain consumption, reduce financial flexibility and create broader economic vulnerabilities. The objective should not simply be debt but ensuring that capital is directed toward genuine market demand, sustainable opportunities and long-term value creation.

Korea's unique financial systems, regulatory environment, corporate governance structures, real estate dynamics and legal frameworks all contribute to these patterns. The fundamental principle remains that capital should ultimately follow productivity and opportunity rather than simply preservation and familiarity.

We as a culture, ethnicity and nation continue to grow and expand across borders, increasing our global relevance beyond our traditional strengths in manufacturing and exports. As Korea enters its next stage of development, the challenge will be to more effectively deploy resources, embrace calculated opportunities and convert accumulated wealth into continued growth.

The defining question for the next generation will shift to ask how we can effectively utilize what we own. Finding the right balance between ownership and opportunity, discipline and ambition, and preservation and growth may prove essential in navigating the inevitable challenges of Korea's continued global advancement.

Sung Lee holds senior executive and advisory posts at Hyosung Group and Midas Private Equity; former Country CEO of WPP Group, Global Head of M\&A for Ogilvy Worldwide, and Regional director for Clear Channel; prior Board Directorships at Kakao Games and LG Ad; Juris Doctorate, University of Michigan.