Samsung's ethics chief calls for pardoning of Vice Chairman Lee

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Thu, December 1, 2022 | 20:11

Samsung's ethics chief calls for pardoning of Vice Chairman Lee

Posted : 2022-06-06 16:39

Updated : 2022-06-06 16:39

Lee Chan-hee, chairman of Samsung's Compliance Committee, speaks during a meeting with top executives of Samsung Group affiliates at its office in Seoul, June 3. Courtesy of Samsung Compliance Committee

By Baek Byung-yeul

Lee Jae-yong, vice chairman of Samsung Electronics

Lee Chan-hee, chairman of Samsung Group's compliance committee, has called for for Samsung Group chief Lee Jae-yong to be pardoned as the leadership vacancy he has left is taking a toll on the country's largest conglomerate at a time when the external business environment surrounding the chip giant is rapidly changing, according to industry officials Monday.

At a time when chips have become the most important strategic material for the United States and China to compete over for technological hegemony, some members of the public and some business groups agree that the government should pardon Lee in order to increase business opportunities.

On June 3, the compliance committee chairman once again raised the need to pardon the Samsung chief so that the nation's largest conglomerate can play a bigger role.

"If the top management of Samsung cannot manage the group properly due to the trial, Koreans will eventually suffer. So, I want the government to make a decision according to the will of the people," Lee told reporters before the committee hosted a regular meeting with top executives of Samsung Group affiliates.

"I think politics or economy should follow the will of the people. People hope that the national economy will develop and their lives will also improve in this really difficult economic situation after COVID-19," the chairman added.

The Samsung Group chief and vice chairman of Samsung Electronics was sentenced to two years and six months in prison in January, 2021 for bribery related to impeached President Park Geun-hye, but was released on parole in August of the same year.

Business lobby groups have been calling on the government to pardon him as he is not legally allowed to return the management until 2027 due to a five-year employment ban.

Under the law here, a person found guilty of embezzling more than 500 million won and is handed down a prison term is banned from employment at companies for five years after the end of the prison term. Due to the law, Lee must obtain approval from the Ministry of Justice whenever he travels overseas for business.

Industry officials attributed the head of the compliance committee's remarks to the need for Samsung to step forward through more aggressive management.

"Committee Chairman Lee's remarks are understandable in principle. Vice Chairman Lee is a decision-maker, but he is participating in management of Samsung only in a limited situation. There should be room for him to manage Samsung Group more aggressively," an official from a local business group said.

He added that the remarks also came after Samsung's recent announcement to invest more than 450 trillion won ($359 billion) over the next five years.

Kim Dae-jong, a professor of business administration at Sejong University, also said pardoning the Samsung chief would help Samsung Electronics implement tasks such as large-scale corporate acquisitions.

"As Lee Jae-yong's role in Samsung's investment activities is absolute, calls are growing to help Samsung develop. Decision makers of Europe or the Middle East do not meet unless their owners come from their counterparts when making business decisions. They think their counterparts don't have the right to decide if it's not the owner," Lee said.

The Samsung chief is scheduled to visit Europe from June 7 to 18 to seek the cooperation of Dutch chip equipment maker ASML. The industry view is that there is also the possibility of corporate acquisition deals being discussed during his trip.

Stating that Samsung has shown a management strategy that actively increases investment when the global economy is weak, the professor added "Samsung could fall behind its competitors if it misses its chance to aggressively invest."

baekby@koreatimes.co.kr Article List