Pardon Not Impacting Corporate Performance
By Jane Han
Staff Reporter
Kim Seung-youn, one of South Korea's most powerful businessmen, had found his way out of penalties before after committing crimes ranging from embezzlement to illegal political fundraising. But getting completely off the hook after beating up nightclub bouncers with a steel pipe marks a whole new level of lenience.
``If you inflict physical violence on another person, you should get punished. That's a basic rule followed even by kindergarteners,'' says Park Keun-young of the leading civic group People's Solidarity for Participatory Democracy.
The Hanwha boss was convicted for a revenge beating last year, when he rounded up a couple of bouncers to beat up bar workers who assaulted his son. The head of the chemical and insurance giant was sentenced to 18 months in prison, but won a suspension of three years.
With Friday's presidential pardon, Kim is relieved of his legal burden. This is the second time for the 56-year-old to benefit from an amnesty, following his first in 1995.
The purpose behind the pardon is ``to create jobs and revive the economy,'' in the words of President Lee Myung-bak. This is why he pardoned other major tycoons such as Hyundai Automotive Group Chairman Chung Mong-koo and SK Group Chairman Chey Tae-won.
The CEOs apparently had a ``tough time'' traveling overseas to key markets like the United States due to their legal problems. Investor relations and other ``image issues'' also hampered business activity, according to business lobbying groups that campaigned for their amnesty.
``The pretext of such an extensive amnesty is always to `revive the economy,' but we wonder if the economy revived after the government set free convicted businesspeople en masse,'' said Hanyang University professor Kim Sang-jo.
Park of the civic group also dismissed the promise of job creation as a worn-out excuse, saying a corporation will create or slash jobs if there is a need to, not simply out of pledges made earlier.
``Many of the crimes committed were done out of personal greed,'' he said. ``This is what people should keep in mind.''
Despite predictions that the amnesty will drive up corporate performance, shares of SK Energy, Hyundai Motor and Hanwha showed little change or slightly slipped, with the benchmark KOSPI index down 14.4 points, or 0.91 percent.
``The amnesty has little or no impact from an investor's point of view unless the CEO's status has a serious influence on corporate management,'' said one analyst at a foreign brokerage, who asked to stay anonymous citing company policy.