During a nationally televised press conference Wednesday at Samsung’s South Korean headquarters, the family-owned conglomerate’s heir and leader, Jay Lee, admitted the company “has not strictly complied with laws and ethics.”
“Although it has been lauded for being first-rate in technology and products, Samsung has faced harsh criticism,” Lee said at the press conference, as reported by The Korea Herald and The New York Times, among others. “This is my fault. I apologize.”
Lee’s mea culpa was followed by a series of admissions and announced changes in business strategy, all of which came at the urging of a corporate compliance oversight committee established earlier this year to help clean up Samsung’s tarnished reputation, The Korea Herald reported. The committee, created by a South Korean judge as part of an ongoing bribery case against Lee and other key executives, advised him to concede and apologize about past wrongdoings.
Samsung has been embroiled in a number of scandals in recent years, including allegations that Lee and other Samsung executives bribed South Korean president Park Geun-hye, who was later impeached and ousted for abuse of power. Lee was convicted on charges connected with bribing the former South Korean president and a top aide and served jail time.
When Samsung’s corporate compliance oversight committee was formed, its head, former South Korean Supreme Court Justice Kim Ji-hyung, said the committee would look closely into a broad range of issues, many of which were addressed at the press conference. Those issues included “bribery, fraud, risky external sponsorship, and illegal internal transactions between affiliates,” as well as “labor issues and management succession.”
Ji-hyung said the committee also will monitor the activities of Samsung’s board of directors and its management committees to ensure compliance with the law, as well as potential misconduct at group companies, including Samsung Electronics.
Among the announcements made at the press conference—Lee’s first since 2015—was that he will be the last member of his family to run the company. Officially a Samsung vice president, Lee has been tapped by his family to take over the company, which was started by his grandfather and run for many years by his father.
Lee also announced a reversal to the company’s historically hardline stance against unions, saying Samsung would allow workers to form independent unions.
“All of the problems basically started from this succession issue,” Lee said at the press conference. “From now on, I will make sure that no controversy happens again regarding the succession issue.”
Samsung is one of the world’s leading technology companies and the largest business in South Korea, employing over 300,000 employees in 74 countries, according to its website. The company had an operating profit of $5.2 billion (KRW 6.45 trillion) on sales of $45 billion (KRW 55.3 trillion) in the first quarter of 2020, according to the company’s first-quarter financial results.