South Korea’s Fair Trade Commission (FTC) will embark on extensive probe on nonprofit organizations run by conglomerates and holding entities for any illegal revenue sourcing for chaebol owner families, said its liberal chair Kim Sang-jo Thursday.
Meeting with representatives from five top business groups, Kim indicated that he was running out of patience with conglomerates in their reform progress.
“It makes me think whether the companies have genuine will to proceed with voluntary reforms,” said Kim, who as an economics professor had been an outspoken critic of excesses of family-run corporate dynasties that earned him the nickname “chaebol sniper.”
“There must not be a huge gap between corporate strategy and the social response,” he said, urging large companies to be speedier and more specific in their social responsibilities so that the society can feel their changes.
The FTC announced it would embark investigation on nonprofit organizations under conglomerates to check whether their role fits their founding purpose. It will also probe revenue base of large holding entities to see whether there are any illegalities in collecting royalties, consulting fees, and rents from subsidiaries.
Samsung Electronics Chief Financial Officer Lee Sang-hoon, Hyundai Motor President Jung Jin-hang, SK Telecom President Park Jung-ho, LG Group President Ha Hyun-hwoi, Lotte Group President Hwang Gak-kyu and Korea Chamber of Commerce & Industry Vice Chairman Lee Dong-geun attended the meeting.
By Seok Min-soo and Lee Ha-yeon
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