Samsung invites external experts to form an anti-corruption panel amidst Vice President’s bribery case

Samsung announced on Thursday that it will be forming a new supervisory panel comprising of external experts to address the rising challenges of criminal conduct within the company. The decision came following the involvement of Samsung’s vice chairman in a bribery scandal. The scandal was reported to involve Park Geun-hye, the former president of Samsung, as well.

Following a thorough evaluation of Vice President Jay Y. Lee’s bribery case by a judge in October, Samsung came under direct criticism for having a lax compliance system. Expressing his dissent, the judge directed the South Korean multinational conglomerate to have contingencies in place.

Samsung’s Oversight & Compliance Panel Will Be Headed By A Former Judge

Samsung’s oversight and compliance panel is being headed by the former supreme court judge, Kim Ji-hyung. In a news conference, Kim was reported quoting that it will greatly disgrace his name should the committee fail to do what it was created for. He further expressed confidence that the committee will work diligently avoid Samsung’s top management from all legal risks.

The judge also highlighted that he had rejected Samsung’s proposal when they first approached him as he was under the impression that the company wished to lean on him for favorable court decisions without actively focusing on making the necessary improvements and amendments.

Ji-hyung went on to say that Samsung’s current leader, Lee is adamant and has guaranteed the independence of the panel. The committee would supervise all activities at Samsung Electronics and its subsidiaries to ensure that no lines as laid down by the law are crossed.

Although Samsung has its own compliance committee, the new panel has been announced to comprise seven members, two from legal circle, two from civic groups, two from academia, and the last from Samsung Electronics. The panel will be set in action from February 2020.

Governance Experts Are Not Convinced Of Samsung’s Move

Despite Samsung’s pledge to improve the company’s transparency and avoid misconduct, Governance experts are not buying the recent move by Samsung, calling it a tool to ensure leniency for the company in the court proceedings.

A corporate governance specialist from Hanyang University commented on Samsung’s move and highlighted that an internal compliance program can just be as effective as long as the company is willing to motivate its employees to report misconduct and related violations without putting themselves and their jobs at the risk of reprisal.

A civic group also responded to Samsung’s external committee and stated that the panel comprising of outside experts can only serve as an advisory group while the legal responsibilities still lie within the Samsung’s board. The committee will not be able to bring any real change unless reforms are introduced to Samsung’s board in the first place.