Samsung advised FKI reentry with withdrawal option for potential collusion

2023. 8. 18. 12:18
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Lee Chan-hee, head of Samsung’s corporate compliance monitoring committee, answers reporters’ questions as he enters the Samsung Life Insurance Seocho Tower in Seoul on the morning of the 18th to attend a temporary meeting held to discuss Samsung’s return to the Federation of Korean Industries. [Photo by Yonhap]
Samsung’s corporate compliance monitoring committee has extended a recommendation for the conglomerate to rejoin the Federation of Korean Industries (FKI), the business lobby of South Korea’s largest companies, on the condition that it immediately withdraw from the organization in the event of political-business collusion.

The FKI has a history of being the nation’s major voice for the business sector. However, Samsung Group companies, along with Hyundai, SK, and LG groups, severed their ties with the organization after 2016 due to its involvement in a political scandal.

Following this recommendation, not only Samsung but also SK Group, Hyundai, and LG Group seem likely to accelerate discussions regarding their reentry into the FKI.

“Samsung’s return to the FKI should be based on a thorough review of the FKI’s operations and accounting transparency, and if the FKI’s cronyism continues, Samsung should withdraw immediately,” Committee head Lee Chan-hee told reporters after a temporary meeting of the committee on Friday morning.

“The focal point of our discussions was whether we can truly sever the link of undue influence. Our greatest concern was that political forces should never interfere in the composition and operations of the FKI,” Lee noted.

“The committee has fundamental concerns about the likelihood and willingness of the current FKI reform plan to actually materialize, as it is merely a declaration, and Samsung’s board and management will make a specific determination on rejoining,” he added.

The committee deliberated for over two hours on whether the FKI could break ties with undue influence and reform itself. The decision to recommend reentry was made unanimously.

Formed in February 2020, Samsung’s committee emerged as an independent body, prompted by the court’s demand for the establishment of an internal compliance monitoring system within Samsung amidst the influence-peddling scandal surrounding former President Park Geun-hye and her close confidante, Choi Soon-sil.

The committee currently consists of seven members, including six external members and one internal member, with chairman Lee Chan-hee leading the committee.

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