Kim Ji-hyung, Chairman of Samsung Compliance Committee, "I will not neglect the role of midwife in compliance management"

Chairman Kim's Year-End Address: "Commitment to Compliance Management Guardians Remains Valid in the New Year"
First Step After Compliance Oversight Committee's New Year Regular Meeting: Meeting with CEOs of Samsung Affiliates

Kim Ji-hyung, Chairman of the Samsung Compliance Committee, is presiding over the '1st Meeting of the Samsung Compliance Committee' held on the 5th at Samsung Life Seocho Tower in Seocho-gu, Seoul. The Samsung Compliance Committee is an external independent organization established to eradicate illegal activities by executives and employees, including CEOs of major Samsung affiliates, and to strengthen compliance management. Photo by Kang Jin-hyung aymsdream@

[Asia Economy Reporter Ki-min Lee] Kim Ji-hyung, Chairman of the Samsung Compliance Committee (former Supreme Court Justice), pledged not to neglect his role as the midwife of Samsung's compliance management next year and expressed his commitment to continuously maintain the effectiveness and sustainability of the Compliance Committee.

With the Compliance Committee selecting meetings with CEOs of Samsung affiliates as its first official activity of the new year outside of regular meetings, the promise between Samsung Electronics Vice Chairman Lee Jae-yong and Chairman Kim to establish Samsung's compliance management is expected to be upheld next year as well.

In his year-end address on the morning of the 31st, Chairman Kim reflected on his pledge at the press conference before the launch of the Compliance Committee in January this year: “I vowed to regard independence and autonomy as vital, to fully perform the role of guardian of compliance management, to implement concrete execution plans where compliance monitoring and control operate effectively, and to leave no sanctuary in the field of compliance monitoring.” He added, “Although much remains to be achieved, this pledge remains valid in the new year.”

Chairman Kim also mentioned the expert review committee’s interviews with the Compliance Committee conducted last month during Vice Chairman Lee’s retrial on the state affairs manipulation case, as well as the final report from the expert review committee this month, saying, “I think it is like the sound of a bamboo clapper striking down to awaken a mind that has unknowingly become lax and to remind us not to lose focus.”

He explained that he held intense meetings with the Compliance Committee members throughout the year and shared the background: “If Samsung can be free from compliance risks and focus on its core business with the best capabilities, it can stand taller as a global top-tier company,” “We should suggest a desirable direction for change at Samsung,” and “This could also bring a new wave of change to the compliance culture across companies.” This recognition formed a consensus among the Compliance Committee members.

Regarding the contrasting evaluations of the Compliance Committee as either “superficial face-saving” or “extra-legal authority,” Chairman Kim said, “The Compliance Committee intends to accept these as they are,” but added, “We need to reduce the divided perspectives.” He urged efforts to improve shortcomings in the spirit of moderation and to alleviate concerns that deny the Compliance Committee.

This year, the Compliance Committee categorized its tasks by risk type into “group-level compliance issues” and “affiliate-level compliance issues” for management. The Committee holds regular meetings to review external sponsorships of related companies, internal transactions above a certain scale under the Fair Trade Act and Commercial Act, and monitors illegal acts, unfair trade, and owner risks.

Chairman Kim particularly noted, “The Compliance Committee selected succession, labor unions, and communication as Samsung’s core compliance agendas this year.” Early on, the Committee recommended Vice Chairman Lee to clarify his stance on these issues. In May, Lee publicly apologized and promised, “There will be no fourth-generation succession,” “We will prevent any talk of no-union management,” “I will listen openly to external advice and criticism,” and “Committee activities will continue without interruption.” Furthermore, Samsung, following the Committee’s recommendations, has commissioned the Boston Consulting Group (BCG), a global consulting firm based in the U.S., to establish a sustainable compliance management system.

Compliance Committee’s New Year Activities Draw Attention... Meetings with CEOs of Samsung Affiliates Scheduled

Samsung Electronics Vice Chairman Lee Jae-yong is making a public apology on the 6th at the Seocho-dong headquarters regarding succession of management rights, non-union management, and communication with civil society. Photo by Moon Ho-nam munonam@

Vice Chairman Lee’s promise to cooperate for the effective and continuous activities of the Compliance Committee appears to be immediately implemented in the new year. In his final argument at the retrial the day before, Lee stated, “I will provide sufficient support so that the Compliance Committee can fully perform its fundamental role,” and expressed his intention to guarantee the Committee’s activities so that it can monitor without exception even the Vice Chairman and top executives.

Reflecting Lee’s will, the CEOs of seven Samsung affiliates that have signed business agreements with the Compliance Committee?Samsung Electronics, Samsung C&T, Samsung SDI, Samsung Electro-Mechanics, Samsung SDS, Samsung Life Insurance, and Samsung Fire & Marine Insurance?are scheduled to meet with Compliance Committee members on January 26 next year.

At this meeting, the Compliance Committee plans to hold a greeting ceremony with the CEOs and reiterate the importance of compliance management. They will also discuss the schedule for compliance education and future operational directions of the Committee.

Additionally, the Compliance Committee decided to change its regular meeting date from the first Thursday of every month to the third Tuesday of every month. This change aims to secure more time for thorough review of Samsung’s major agendas and to provide effective opinions.

Samsung affiliates’ board meetings are usually held at the end of the month, which had previously caused a time gap with the Compliance Committee’s regular meetings. However, the next regular meeting is scheduled for January 21 next year.

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