Stronger than Ever
Samsung, along with SK, Hyundai, and LG, the four major conglomerates, are set to rejoin The Federation of Korean Industries after a hiatus of 6 years and 8 months.
According to industry sources on Aug. 20, Samsung, after taking into consideration the recommendation for a “conditional rejoining” from its Compliance Oversight Committee, will hold board meetings for its five related companies (Electronics, SDI, Life, Fire, Securities) on Aug. 21 to report on the matter and finalize the rejoining process. SK, Hyundai, and LG have already undergone or plan to undergo similar procedures. Companies rejoining the FKI include five from Samsung, four from SK (SK Corp, innovation, telecom, networks), five from Hyundai (Hyundai Motor, Kia, Hyundai E&c, Hyundai Mobis, Hyundai Steel), and two from LG (LG Corp and LG Electronics).
On Aug. 22, the FKI will hold a provisional general meeting to change its institution name, which when translated means “Korea Economic Association,” and inaugurate Ryu Jin, chairman of Poongsan Corporation, as chairman of the organization. With the return of these four major groups, the turbulence that continued after the so-called “national political scandal” in 2016 is expected to somewhat subside.
Although FKI has repeatedly expressed its commitment to innovation after taking office under acting Chairman Kim Byung-joon amid controversies over political-business collusion, many believe that its efforts are still insufficient in gaining public trust. Samsung’s Oversight Committee has warned, as stated by Chairman Lee Chan-hee, that “Under no circumstances should political authorities interfere with FKI’s personnel or operations.” They even recommended immediate withdrawal if there were any signs of such collusion.
In response, the newly launching FKI plans to establish an independent Ethics Committee comprised of external experts to minimize the risk of political-business collusion. For instance, business activities related to government fund contributions must go through strict review processes, granting significant authority to this ethics management committee to fundamentally prevent possible collusion.
The FKI aims to evolve into a “think-tank type economic organization,” mirroring Japan’s Keidanren, which serves dual roles in research and as an economic group.
The FKI will also focus on expanding its membership. Efforts are already being made to encourage the fifth-largest conglomerate, POSCO, which is currently not a KEA member, to rejoin. Recently, battery material company EcoPro, which applied for membership, is also expected to be accepted. The current executive committee, comprising 11 companies (or groups), is considering expanding its reach to include enterprises from emerging industries, the younger generation, and various fields like AI, entertainment, and fintech.