Baek Byung-yeul is a journalist at The Korea Times focused on cultural content, including films and cultural events in South Korea. You can contact him at baekby@koreatimes.co.kr to share your insights.
Samsung's compliance body receives 'constructive review'
Samsung Electronics Vice Chairman Lee Jae-yong, center, heads to a court room to attend a re-hearing of his case at the Seoul High Court, Nov. 30. / Yonhap
By Baek Byung-yeul
By Baek Byung-yeul
Samsung's self-created compliance committee received a constructive review from a court advisory panel, being recognized for its effectiveness as a watchdog in ensuring the country's top conglomerate abided by the law and improved group-wide management transparency.
As the group's leader Lee Jae-yong is undergoing a high court re-hearing over a bribery scandal involving jailed former president Park, it remains to be seen whether the group's efforts to be as transparent as possible will affect the ruling.
The Seoul High Court recently made public the report of three experts who assessed the activities of Samsung's compliance committee. The experts ― former Constitutional Court Judge Kang Il-won, attorney Kim Kyung-soo and accountant Hong Soon-tak ― submitted their 83-page final report to the court Dec. 14.
In the report, the former Constitutional Court judge expressed a positive view on the committee's activities, recognizing the durability and effectiveness of the watchdog.
“What is positive is the committee set agendas regarding managerial succession, unions and communication with civic organizations and recommended the group improve these,” Kang noted in the report adding the recommendations clearly helped Samsung improve its compliance systems.
The Samsung leader was indicted in 2017 over his alleged involvement in offering a bribe to a longtime friend of Park as he sought backing in succeeding to the ownership of Samsung. He was initially sentenced to five years in jail but was freed after a year when the Seoul High Court cut the term to two years and dismissed most of the bribery charges against him at an appeals hearing. However, the Supreme Court acknowledged additional bribery charges and sent the case back to the high court.
Given the report of experts could have an effect on the hearing, an industry official said the opinions were positive for Samsung. He added the report showed the compliance committee has been recognized for its effectiveness as an independent organization to oversee the group's compliance matters.
“The report was made before the court makes its final decision on Lee Jae-yong. The report shows the experts recognized Samsung Group's efforts to make its corporate culture more law abiding and to avoid a repeat of these kinds of issues in the future,” the official said.
Samsung launched the independent compliance committee in February to review and monitor the group's compliance. To enhance independence of the committee, the group appointed former Supreme Court Justice Kim Ji-hyung as its head and six other members including Ko Gye-hyun, secretary-general of Citizens United for Consumer Sovereignty, Kwon Tae-sun, co-chief of the Civil Society Organizations Network, and attorney Bong Wook.
Since its establishment, the committee has selected three issues, the group's union, management succession and communication with civic organizations, as key points on its agenda to improve the conglomerate's business compliance.
The committee also sent recommendations to the group's management including its leader Lee Jae-yong to make a public apology over its previous illegal activities.
In response, Lee held a press conference in May and issued an official apology over the various wrongdoings including his efforts to take control of the group. He also pledged not to pass the company's management on to his children. Plus, Lee also apologized over the group's hesitance to guarantee the activities of unions. Samsung had been notorious for decades for adhering to a no-union policy, even though this stance went against the country's Constitution, which guarantees workers three rights: the right to organize, the right to collective bargaining and the right to collective action.