Reaffirming the Commitment to a "New Samsung" by Lee Jae-yong in the Trial Upholding the National Promise

Samsung Electronics Vice Chairman Lee Jae-yong's Clear Commitment to New Management Promises Made to the Public in May, Including Succession Abandonment and Abolition of Union-Free Management

Samsung Electronics Vice Chairman Lee Jae-yong is heading to the courtroom to attend the continued trial of the retrial for the 'state affairs manipulation' case at the Seoul High Court in Seocho-gu on the afternoon of the 30th.
[Image source=Yonhap News]

[Asia Economy Reporters Changhwan Lee and Gimin Lee] As the retrial of Samsung Electronics Vice Chairman Lee Jae-yong related to the state affairs manipulation case approaches its final stages, the promises of the 'New Samsung' that Lee has repeatedly announced are being steadily fulfilled.

Regarding Lee's final statement, in which he pledged to fulfill Samsung's social roles and responsibilities and earn the public's trust, evaluations from both inside and outside the business community, including Samsung, suggest that Lee provided a sincere answer to the court's question about what Lee Jae-yong-style new management entails.

On the afternoon of the 30th, at the retrial sentencing hearing held at the Seoul High Court, Lee reiterated his determination to keep the public promises he made at a press conference last May through his final statement. At that time, he pledged before the public to abandon the fourth-generation succession, end union-free management, and expand communication with civil society amid suspicions surrounding the succession of management rights. By showing a changed image directly, he emphasized once again at the trial his will to be reborn as a Samsung loved by the people.

Professor Kyungmook Lee of Seoul National University's Business Administration Department said, "Fundamentally, the government should stop shaking things up while asking businesspeople for help," but added, "In Lee's final statement, there was a glimpse of Samsung's intention to pursue more thorough compliance management in the future."

In fact, rapid changes have been detected within Samsung since Lee's public promises. A representative example is the allowance of labor unions. In May and June, Samsung held special lectures on sound labor-management relations by Moon Sung-hyun, chairman of the Economic, Social and Labor Council and a labor relations expert, for presidents and HR team leaders, aiming to improve the management's previously negative perception of 'unions.'

Accordingly, Samsung established a 'Labor-Management Relations Advisory Group' composed of external experts under the board of directors to ensure effective protection of labor rights and implemented measures such as mandatory labor-related compliance education for employees. Subsequently, Samsung permitted union activities including recognition of full-time union officials, guaranteed activity time for negotiations, and installation of in-house union offices.

The promise to expand communication with civil society is also being fulfilled. Samsung has designated dedicated personnel to serve as communication channels for continuous dialogue with civil society and is broadening understanding and cooperation by engaging with various civic groups.

In June, executives from Samsung Electronics and other major affiliates met with senior figures from civil society to discuss ways to expand communication with civic organizations and mid- to long-term development plans to transform into a company that meets the public's expectations.

The business community hopes for leniency from the court, as Lee and Samsung are overcoming their past negative image and being reborn as New Samsung. There are concerns about increased management instability due to the prolonged trial. Given the current global business environment's unprecedented uncertainty, if another leadership vacuum occurs, Samsung's future could become uncertain.

When Lee was imprisoned in 2017 related to the state affairs manipulation case, Samsung halted large-scale investments and mergers and acquisitions (M&A). However, after Lee's return, Samsung announced massive semiconductor investments and has been steadily implementing them, actively fostering new businesses.

A business insider said, "Having a leader with ownership in a company greatly influences various aspects such as new business development and large-scale investment decisions," adding, "In the era of Lee Jae-yong, Samsung must pioneer a new future, and if another leadership absence occurs, it will inevitably have a negative impact on Samsung."

This content was produced with the assistance of AI translation services.