The question of economic reform has been one of the most debated issues in the study of North Korean political economy. Through examining the case of corporate governance reform under the Kim Jong Un government, we argue that existing discusions of North Korea reform rest on a problematic ontological separation of state and market that fails to capture the extent to which the state uses economic reform to embed itself in and in certain respects deepen market dynamics to ensure its own reproduction. As we argue, the Socialist Enterprise Responsibility Management System has sought to reduce the role of central planning, increase management rights and incentives, institutionalize SOE engagement with the market, and provide more scope for performance-related pay for workers. In recognizing the role of private capital, it has placed enterprises' market activities on a firmer legal basis, albeit without fully legalizing private property rights. The measures represent not only the recognition of existing market dynamics but also their institutionalization, giving the reforms both a reactive and a proactive dimension. However, there are also strict limits placed on this process as part of the state's strategy of political control. While the state's policies can to a degree be seen as “pro-market,” policy makers are reluctant to allow space for a genuine non-state sector to emerge and accept the market only to the extent that it contributes to and strengthens the state sector.