The Samsung Compliance Committee (Compliance Committee) refuted the ruling of the National Nongdan Destruction and Recall Tribunal that sentenced Samsung Electronics Vice Chairman Lee Jae-yong to imprisonment. The Samsung Compliance Committee issued a statement after the first regular meeting of the new year at the Samsung Life Tower in Seoul on the 21st, and said, “The committee is not in a position to comment on the results of the sentence.” On the judgment (with the court), opinions are clearly different.”
Imprisonment for Lee Jae-yong in the court “Insufficient effectiveness”
Compliance Committee refutes “different opinions” ruling
Vice Chairman Lee “Continue to support the activities of the Compliance Committee”
– The Seoul High Court Criminal Division 1 (deputy judge Jung Joon-young) sentenced Vice-Chairman Lee to a sentence of two years and six months in prison on the 18th and evaluated the Compliance Committee as “it is difficult to say that it has met the standards of effectiveness.” It was judged that it was not possible to preemptively monitor new behaviors that could occur in the future.
The Compliance Committee is an organization that investigates and monitors the violations of the law by Samsung’s top executives. The discussion began in May 2019 when Vice Chairman Jung Joon-young ordered Vice Chairman Lee to “if an effective system is established, it will be reflected in the sentencing”. Accordingly, the Compliance Committee has been regarded as a major variable to determine Lee’s sentencing. In accordance with the Compliance Committee’s recommendation, Vice Chairman Lee also apologized to the public, including ▶ abandoning the succession to the age of 4 ▶ abolishing the non-union management.
In response to the court ruling, the Compliance Committee said, “The committee diagnosed that’the core of Samsung’s compliance issue lies in the issue of succession of management rights’.” “Vice-Chairman Lee announced that he would give up the succession to the fourth generation. He refuted, “What are more effective measures to block possible illegal acts in the future?”
The Compliance Committee also expressed its intention to focus on building a healthy governance structure after giving up the succession. He added that it will take precautionary measures to prevent another risk from occurring, and will also work in the field of labor and communication. He then emphasized, “I will only prove the effectiveness with the results,” and “I will continue my work regardless of the judgment.”
At the meeting on this day, amendments to the operating regulations of the Compliance Committee were mainly discussed. The amendment included the contents that the recommendation of the committee was decided by the resolution of the board of directors of each affiliate, and when re-recommended, the compliance committee chairman appeared at the board of directors to ensure the right to state their opinions. It seems that he was conscious of the’satisfying effectiveness’ of the judges.
Meanwhile, Vice Chairman Lee expressed his pledge to “continue to support the activities of the Compliance Committee” through a lawyer on the morning of that day. This is the first message that came out three days after being imprisoned in a Seoul detention center. Samsung Electronics said, “Along with the pledge that Vice Chairman Lee will continue to support the activities of the Compliance Committee, he pleaded with the chairman and members of the committee to continue to play their role in the future.” Vice-Chairman Lee stressed that in the final statement of the revocation and reconciliation in December last year, “We will provide sufficient support to ensure that the Compliance Committee does not lack in its original role.” In October last year and early this year, after meetings with the Compliance Committee, they also promised regular meetings.
Reporter Choi Hyun-joo and Shin Hye-yeon [email protected]
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