SEOUL (Reuters) – South Korea’s Samsung Group, whose chief faces trials over a bribery scandal involving former president Park Geun-hye, has appointed exterior consultants to a brand new oversight panel to stamp out felony conduct, the chief of the committee mentioned on Thursday.
FILE PHOTO: Samsung Electronics Vice Chairman, Jay Y. Lee, arrives at Seoul excessive courtroom in Seoul, South Korea, October 25, 2019. REUTERS/Kim Hong-Ji
The transfer got here after a decide overseeing Samsung chief Jay Y. Lee’s bribery case in October criticized the highest conglomerate for its lack of an efficient compliance system, saying one was wanted to forestall wrongdoing by executives and its chief.
“The timing Samsung selected to make these modifications shouldn’t be stunningly sufficient … and if this committee fails, I’ll find yourself with enormous shame,” mentioned Kim Ji-hyung, a former supreme courtroom decide named to go the compliance and oversight committee, informed a information convention.
He mentioned he initially turned down Samsung’s supply, due to worries it could find yourself failing to make enhancements and solely be utilized by Samsung to safe favorable courtroom rulings.
He mentioned Lee, Samsung’s de facto chief, pledged to ensure the panel’s autonomy at a gathering, including that it could monitor potential misconduct at group firms, together with flagship Samsung Electronics (005930.KS).
Though Samsung Group already has a compliance program in place, the brand new panel, which is able to start work in February, will probably be run by seven individuals, largely outdoors consultants from authorized circles and civic teams.
Governance consultants aired scepticism, calling the transfer a gesture to get lenient therapy in courtroom and citing a repeat of felony offences at Samsung and different family-run conglomerates, regardless of pledges to enhance governance and transparency.
“An efficient compliance program may very well be operated inside the atmosphere, encouraging workers to internally report violation with out fearing reprisal. However this isn’t the case at Korean firms,” mentioned Lee Chang-min, a specialist in company governance at Seoul-based Hanyang College.
The 51-year-old Lee faces fees that he bribed a good friend of former president Park to win authorities favor over succession planning on the conglomerate.
In August, the Supreme Courtroom overturned an appeals courtroom ruling that had given Lee a suspended jail time period, elevating the potential for a more durable sentence and potential return to jail.
Executives of Samsung Electronics and biotech affiliate Samsung BioLogics (207940.KS) have additionally been jailed on fees of sabotaging union actions and accusations a couple of suspected accounting fraud, respectively.
Reporting by Heekyong Yang; Enhancing by Hyunjoo Jin and Clarence Fernandez