Quite the compliance moment was witnessed in Korea this week, when the executive team at Samsung Electronics made a public display of signing a pledge to obey anti-corruption laws and build a new culture of compliance at the firm.
The firm’s top three executives — president Kim Hyun-seok, vice chairman Kim Ki-nam, and mobile communications head Koh Dong-jin — signed the pledge at a publicity event at Samsung headquarters on Monday. Like, in front of the cameras. With reporters around and publicity photos issued.
According to the Korea Herald, the men agreed to obey all local and foreign laws, to build a culture of compliance, and to cooperate with a new oversight panel that will monitor how Samsung recovers from a bribery scandal that has dogged the company for years. Other Samsung executives made similar promises, signing the pledge electronically.
Long story short: Lee Jae-Yong, heir to the Samsung empire and vice chairman of the conglomerate, was convicted in 2017 of bribing former South Korea president Park Geun-hye to help Lee wrestle control of the business from Lee’s father.
Lee served nearly a year in prison before a court ordered Lee released in 2018. Then Korea’s Supreme Court overturned that ruling last summer, so Lee is facing new bribery charges now. He still retains his vice chairmanship with Samsung and is de facto boss of the firm.
Meanwhile, Samsung’s board chairman, Lee Sang-hoon, was sentenced last month to 18 months in prison for separate charges of violating labor laws. Other executives have also ended up in jail for various offenses in recent years.
So you can see why Samsung’s current leadership might want to make a dramatic gesture that, yes really, they are determined to clean up the company’s corrupt past. That’s what this was.
Interesting note: the pledges that the trio took are all voluntary measures. That is, they aren’t required by Korean criminal or securities law, akin to the Sarbanes-Oxley certifications that CEOs and CFOs sign every quarter; or legally binding in any other way.
On the other hand, the pledges do bind the men’s word in a very, very public manner. One can only imagine the public shame they might face in the future if they fail to deliver.
Anyway, a bold commitment to ethics and compliance from Samsung. Let’s wish them luck — and that more executives would make such a grand gesture.