3 firms in dire straits
By Kim Tae-jong
Three firms have recently got into trouble for different examples of poor business ethics ― Namyang Dairy Products, Hyundai Steel and Janssen Korea.
Namyang has seen a huge drop in sales due to massive boycotts for allegedly forcing wholesalers to buy more products than they could sell to pass any losses on to them.
A file recording a Namyang official threatening one wholesaler was posted on the Internet, triggering public outrage.
Hyundai Steel is in deep trouble after a gas leak killed five workers on May 10 at its plant in Dangjin, South Chungcheong Province.
The steelmaker has not once been held accountable for repeated accidents that have killed or injured about 30 workers at the plant overe the past few years.
Instead it passed the blame on to subcontractors.
The Ministry of Employment and Labor will soon launch an investigation into the firm to see whether it has properly managed its facilities and offered necessary safety education to workers.
Janssen Korea was under fire for delaying to report the potential danger posed by the presence of excessive amounts of acetaminophen in two of its children’s Tylenol syrup products.
Despite being aware of the anomalies in its products in March, it was not until a month later that the local unit of Johnson & Johnson’s pharmaceutical affiliate notified the drug safety agency. During the period, the company kept selling Children’s Tylenol Suspension 100ml and 500ml, though they potentially could cause liver damage.
After spending about 30 days conducting an internal investigation to ascertain the cause of the problem, the company reported it to the Ministry of Food and Drug Safety (MFDS), which ordered the company to recall all of the two fever relievers produced since May 2011. It was a clear violation of a regulation which states a pharmaceutical company must report any safety problems to the agency as soon as possible.
What is more disappointing is the company’s attitude to the matter. A spokesman had said, “You don’t need to worry about it because most of the products are safe. It is just 2 percent of products which are problematic.”
Experts say that the three firms are “good” examples to show how companies with poor business ethics can face serious setbacks.
“It’s a matter of the ethics of chaebol owners. CEOs need to have ethics education as well as employees. What we need is a holistic approach to reform business ethics from employees to CEOs,” Lee Wan-jae, head of the Korea Business Ethics Association, said.
Kim Han-ki, director of Citizens' Coalition for Economic Justice, demanded the government should come up with stricter regulations on malpractice, as most companies have very low standards for business ethics.
“Companies would have no reason to oppose the revised law which aims at regulating unfair business practices, if they think they are doing business in fair manner,” Kim said. “Their opposition shows that their business ethics are suspect.”