Samsung Compliance Committee, First Statement After Trial... "Will Prove Effectiveness Through Results" (Comprehensive)

After the Regular Meeting on the 21st, Lee Jae-yong's Retrial Court Issues Statement
"Clear Differences in Views on Effectiveness Judgment... Achievements Over the Past Year"

[Image source=Yonhap News]

[Asia Economy Reporter Jeong Hyunjin] The Samsung Compliance Committee held its first meeting on the 21st since Vice Chairman Lee Jae-yong of Samsung Electronics was sentenced to prison and taken into custody following the retrial of the National Pension Service scandal. The committee stated, "Regardless of the verdict, we will continue to fulfill our duties" and added, "We will prove our effectiveness through results."

The Compliance Committee made this announcement in a statement released after its regular meeting held at the Seocho building in Seoul. This was the committee's first response to the court's ruling on the 18th, which sentenced Vice Chairman Lee to 2 years and 6 months in prison, stating that the committee did not meet the criteria for effectiveness and would not be able to proactively monitor potential future misconduct.

The committee said, "We are not in a position to comment on the sentencing. Although the committee was established as a result of the trial, it has operated independently regardless of the trial," but also stated, "We clearly have a different opinion regarding the judgment on effectiveness." The committee emphasized that "since its inception, despite a harsh internal and external environment, it has devoted all efforts to pioneering a desirable compliance culture at Samsung," and that it will not respond to the verdict in detail but will instead fill in the gaps and prove its effectiveness solely through results.

The committee explained, "The goal of the committee has always been clear beyond doubt: to deeply root compliance within Samsung and prevent any illegal activities from taking hold," adding, "We want to ensure that not only within Samsung but also outside, no one dares to attempt anything against compliance." It further stated, "In the past, there were chronic illegal acts including so-called collusion between politics and business. All must be eradicated," and added, "Samsung must demonstrate that it is as clean, clear, concise, and compact as possible regarding compliance. We will pursue this goal unwaveringly."

Regarding Samsung's management succession issue, the committee referred to Vice Chairman Lee's announcement to forgo the 4th generation succession, saying, "What could be a more effective measure than this to sever ties with past illegal cases and preemptively block potential future illegal acts?" It asked for understanding that once the succession issue is resolved, the remaining issue is the 'rational improvement of governance,' which the committee was already reviewing. The committee also acknowledged, "There have been meaningful achievements and results through nearly a year of committee activities," but admitted, "We are well aware that we are still far from boasting about the committee's accomplishments. For that reason, the committee will set and tackle future tasks with renewed determination."

Additionally, the committee introduced its future operational plans, stating, "We will gather and implement insights from experts and various sectors of society on what the 'most desirable compliance monitoring system' should be," and "We will focus more on building a healthy 'governance' after the abandonment of the 4th generation succession and strive to establish preventive measures to avoid other risks related to succession." It also mentioned plans to strengthen labor and communication issues and routine committee activities, adding, "We will continuously persuade Samsung that compliance is not merely a temporary measure or an inconvenience to be endured, but the ultimate goal that creates social value."

The Compliance Committee concluded its statement by saying, "We hope for more encouragement and support from those inside and outside Samsung who wish for Samsung to establish a desirable compliance culture and develop further as a global top-tier company shining in the world. The committee hopes that the new history of compliant Samsung will not be broken," and affirmed, "The committee's will is firm."

This statement aligns with Vice Chairman Lee's message on the same day emphasizing 'compliance management.' Earlier that morning, Samsung Electronics conveyed through Lee's legal counsel that he pledged continued support for the Compliance Committee's activities and earnestly requested the chairman and members to continue fulfilling their roles. This was the first message released four days after Lee was sentenced to 2 years and 6 months in prison and taken into custody in the retrial of the National Pension Service scandal, interpreted as urging not to be discouraged by his trial outcome and to sustain the committee's activities.

Meanwhile, at the meeting, the Compliance Committee discussed amendments to operational regulations to strengthen the committee's effectiveness. The amendments include requiring board resolutions when affiliated companies do not accept the committee's recommendations and guaranteeing the Compliance Committee chairman's right to attend and present opinions at the board when re-recommending. The amendments will be finalized after approval by the affiliated companies' boards. The committee also received reports on plans to convert the currently irregular meetings of compliance officers from affiliated companies into a regular quarterly consultative body and to establish a consultative body for compliance department staff.

The Compliance Committee plans to hold a meeting on the 26th with CEOs and top executives of seven affiliates, including Samsung Electronics, Samsung Electro-Mechanics, Samsung SDI, Samsung SDS, Samsung Life Insurance, Samsung Fire & Marine Insurance, and Samsung C&T.

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