The Federation of Korean Industries (FKI), which has been pushing for organizational innovation to restore its status in the business world, will change its name to the Korea Economic Association (Korea Economic Cooperation) this week and make a fresh start.
The biggest task of the newly launched Korea-Economy Cooperative is to dispel concerns that such a thing could happen again, as the true nature of collusion between politics and business through the Federation of Korean Industries was revealed during the Park Geun-hye administration’s government scandal.
The fact that the four major groups (Samsung, SK, Hyundai Motors, and LG), which turned their backs on the Federation of Korean Industries (FKI) after the corruption scandal, actually joined the Korea Economic Cooperation is an observation that it depends on how convincingly the Korea Economic Cooperation implements the ‘break with the past’. comes out
Samsung Supervision Committee returns conditionally to the Federation of Korean Industries… Recommendation of ‘withdrawal in case of collusion between politics and business’
On the 18th, the Samsung Compliance Committee (hereinafter referred to as the Subcommittee) recommended that Samsung return to the Federation of Korean Industries (FKI) and withdraw immediately in the event of collusion between politics and business.
The Samsung Audit Committee discussed intensively for more than two hours on the day whether the Federation of Korean Industries could break the link of political-business collusion and reform, and unanimously decided on a recommendation.
Accordingly, SK Group, Hyundai Motor Group, and LG Group, as well as Samsung, are expected to speed up discussions on returning to the FKI.
After meeting with reporters after an extraordinary meeting at Samsung Life Insurance’s Seocho office building this morning, Chan-hee Lee, chairman of the Associate Supervisory Board, met with reporters and said, “If you join the Federation of Korean Industries, if the act of collusion between politics and business continues, you will immediately withdraw and thoroughly review measures to secure transparency in operations and accounting.” We recommend that you make a decision after going through it.”
The photo shows the FKI Hall in Yeongdeungpo-gu, Seoul. 2023.8.18
◇ “I’ll go back to the beginning”… After 55 years, with the initial name ‘Korea Economic Cooperation’
According to the business community on the 20th, the Federation of Korean Industries plans to handle the agenda to change the name of the organization to Korea Economic Cooperation at an extraordinary general meeting on the 22nd.
The Korea Economic Cooperation was not a name that appeared for the first time, but the name of an economic organization established in 1961 as the predecessor of the Federation of Korean Industries.
The name of the ‘1st Korean Economic Cooperation’, which started with 13 entrepreneurs including the late Samsung Group founder Lee Byung-cheol, is said to have the meaning of ‘a group of people who make the country right and save the people’. This is also the background of the group’s name by adding human (人) to the ‘economy’ of the people of Gyeongju (governing the country and saving the people).
Then, in 1968, less than 10 years later, when member companies increased to about 160 companies across the country, the name was changed to the current ‘Federation of Korean Industries’ to reflect the changed situation. It is like going back to the Han Economic Cooperation after 55 years.
The Federation of Korean Industries explained that the fact that the newly launched successor of the FKI is named Korea Economic Cooperation is a reflection of its will to ‘go back to the beginning and put the country and people first into practice’.
At this general meeting, the agenda of integrating the Korea Economic Research Institute (Korea Economic Research Institute), which was a research institute under the FKI, into the Korea Economic Cooperation will be handled, and the process of appointing Poongsan Group Chairman Ryu Jin as the chairman of the Korea Economic Cooperation will also be carried out.
Community Chest of Korea Chairman Kim Byeong-joon, who served as acting president of the Federation of Korean Industries for six months from February this year, is expected to continue his activities as a standing advisor. Kim Chang-beom, a former official at the Ministry of Foreign Affairs and former Indonesian ambassador to Indonesia, is expected to be appointed as the current vacant full-time vice chairman.
Samsung Supervisory Commission, conditional return to ‘withdrawal in case of political-business collusion with the Federation of Korean Industries’
Recommendation The Samsung Compliance Committee (hereinafter referred to as the Quasi-Committee) recommended Samsung to return to the Federation of Korean Industries (FKI) on the 18th, on the condition that it withdraw again in the event of political-business collusion. On the morning of December 6, 2016, at the National Assembly Chaebol leaders who appeared as witnesses at the ‘Special Committee for State Affairs Investigation to Investigate the Truth of the Park Geun-hye Government’s Suspicion of State Affair by Civilians such as Choi Soon-sil’ are taking oaths. 2023.8.18
◇ ‘Government Nongdan trauma’ must be overcome… Institutional devices to block political-business collusion
As the eldest brother of the business world, the Federation of Korean Industries played a key role in functioning as a communication channel between the government and the business community. In the process, in response to the government’s request with the intention of cooperating with state affairs, companies were asked to contribute funds, which was virtually ‘compulsory’.
The trigger for such a disease to fester was the issue of contributions to the Mir and K-Sports foundations during the Park Geun-hye administration.
The Federation of Korean Industries, which underwent a situation in which the foundation of the organization was shaken due to collusion between politics and business, suffered the humiliation of being alienated to a level close to ‘passing’ during the Moon Jae-in administration. Since the inauguration of the Yoon Seok-yeol administration, he has been aiming to restore his status by leading an economic delegation to accompany the Korea-Japan and Korea-US summits, but the psychological impact on the organization was considerable.
The fact that the Federation of Korean Industries (FKI) announced an innovation plan last May, including a name change, and declared that it would put in place an institutional device to block the possibility of collusion with political power, also stemmed from this trauma.
One of the key action plans is the formation of an ethical management committee composed of outside personnel.
The Ethical Management Committee takes on the role of reviewing the appropriateness of a specific project that the FKI executive department and the Secretariat intend to promote may exert tangible or intangible external pressure on member companies. For example, it seems that government-related fund contributions must pass a review by the Ethical Management Committee to grant authority to the level at which business execution is possible.
It is interpreted that the attempt to change its identity into a ‘think tank-type economic organization’ by absorbing and integrating the Korea Economic Research Institute, which was a research institute under the Federation of Korean Industries, into the Korea Economic Cooperation Cooperation is also in line with the direction of distancing itself from political power.
Responding to global issues by preemptively developing policies and suggesting alternatives, instead of passively responding only after a company-related issue arises, and promptly responding to pending issues such as the Inflation Prevention Act (IRA) by strengthening a network of domestic and foreign experts. The idea is to redefine the role with the support of member companies.
◇ Social trust is still lacking… The return of the four major groups also depends on the practice of innovation.
The problem is that the social consensus on the FKI’s will to innovate is still lacking, as the innovation plan has not yet been implemented in earnest. The four major groups, which are considering joining the Korean Economic Cooperation, the successor of the Federation of Korean Industries, are still struggling with whether or not to act as actual members because of these problems.
First of all, the four major groups are expected to raise their names as members of the Korea Economic Cooperation in the form of this general meeting.
These groups withdrew from the Federation of Korean Industries after the Gukjeong Nongdan incident, but major affiliates remained as members of the Hankyungyeon, an affiliated research institute. It is known that the four major groups will not express their intention to reject this.
On the 21st, the day before the general meeting of the Federation of Korean Industries, the five affiliates (Samsung Electronics, Samsung SDI, Samsung Life Insurance, Samsung Fire & Marine Insurance, and Samsung Securities), which were members of the Korea Economic Union, held a board of directors meeting to finalize their position on the succession of membership to the Korea Economic Cooperation. It is said that SK, Hyundai Motors, and LG are also going through their own review process.
However, it is expected that it will take some time before joining as a member company in the true sense of the word, such as paying the dues and taking a specific position at the Korea Economic Cooperation. This is because the four major groups that left the Federation of Korean Industries in the name of ending the link between politics and business collusion need to create conditions to fully resolve the justification for leaving the Federation if they want to join the Korea Economic Cooperation, the successor.
Previously, the Samsung Compliance Committee (junior supervision committee) also evaluated the innovation proposal presented by the Federation of Korean Industries as having a ‘declarative meaning’, and expressed its position that “I am not sure whether the Korea Economic Cooperation can completely sever the link of collusion between politics and business and transform itself.” The Jungam-Wi recommended that even if Samsung joins the Korea Economic Cooperation, it should immediately withdraw if there is a political-business collusion.
An official in the business world said, “It is difficult to say that the cause of the four major groups at the time of their withdrawal from the FKI has been completely resolved.” ‘, the four major groups will join in earnest.”
Poongsan Group Chairman Ryu Jin, who will be officially appointed as the chairman of the Korea Economic Cooperation Council on the 22nd, will begin his term with such heavy tasks. Attention is focused on whether it will be able to gain the trust of all sectors of society, including the four major groups, in the near future by pushing ahead with the innovation plan previously put forward by the Federation of Korean Industries. (yunhap news)
2023-08-20 02:15:22
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