Samsung Puts Up Anti-Corruption Board As Chief Faces Hearing

According to the chief of the committee of South Korea’s Samsung Group, the leader faces legal proceedings over a bribery scandal. The information was disclosed in a news report this Thursday.

The issue is involving the previous president Park Geun-Hye. It was because he has appointed external authorities to a new oversight panel to stamp out illicit conduct.

Moreover, a move came after a judge that is directing Samsung leader Jay Y. Lee’s bribery case in October condemned the top conglomerate.

The criticizing was for its lack of an efficient compliance system, declaring one was necessary to avert the wrongdoing by executives and its director.

In a news conference, a former supreme court judge named to head the compliance and oversight committee, Kim Ji-Hyung, stated, “The timing Samsung chose to make these changes is not adequate … and if this board fails, I will end up with huge shame.”

Ji-Hyung added that he initially turned down Samsung’s offer. It was because of fears that it would end up collapsing to make improvements and only be utilized by Samsung to guarantee favorable court rulings.

In a statement, he said that Samsung’s de facto leader, Lee has pledged to certify the panel’s autonomy at a meeting.

He also stated that it would scrutinize potential misbehavior at group companies, comprising flagship Samsung Electronics.

However, the Samsung Group already has a compliance program in place. It is the new panel, which will start work in February. In addition, it will be running with only seven people.

These are mainly outside professionals from legal circles and civic parties.

Authority Experts Broadcasts Suspicion

On the other side, governance experts have broadcast skepticism. They have been calling the move a token to get lenient treatment in court.

Moreover, they cited a duplicate of criminal insults at Samsung and other family-run firms, despite guarantees to enhance governance and transparency.

A specialist in corporate governance at Seoul-based Hanyang University, Lee Chang-min, said, “An effective compliance program could be operated within the environment, encouraging employees to report violation without fearing reprisal internally. But this is not the case for Korean companies.”

Meanwhile, the 51-year-old Lee faces allegations that he persuaded a friend of former president Park. It is to win authority favor over succession planning at the conglomerate.

In August, the Supreme Court invalidated an appeal court ruling that had given Lee a suspended jail term. It was because it is raising the chance of a harsher sentence and probable return to jail.

Executives of Samsung Electronics, along with biotech affiliate Samsung BioLogics have also been on charges.

The fines were concerned about interfering with union activities and complaints about suspected accounting fraud, correspondingly.

Elsewhere, Asian stocks had their best session in weeks Today. The upsurge was when the United States and Iran backed away from the brink of conflict in the Middle East.

In addition, investors switched their flight to safety.

Meanwhile, MSCI’s broadest index of Asia-Pacific shares outside Japan soared 1.3%. Its most substantial gain in almost a month in the stock market.

On the flip side, Hong Kong’s Hang Seng and Shanghai blue chips each increased more than 1%.

Japanese stocks also strengthened further, adding 2% to their peak for the year so far.