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Samsung not in partying mood for 80th birthday

Heir apparent hasn’t gone out in public since leaving jail

Mar 23,2018
Samsung celebrated its 80th anniversary Thursday, but there was no party.

Korea’s most formidable business empire marked the milestone by playing a video on its internal broadcasting system Thursday morning and posting photos chronicling the corporate history on an internal message board for employees.

There was no official event.

Employees of different subsidiaries will be doing voluntary charity work for local communities for a month as part of the celebrations.

In the absence of Vice Chairman and heir apparent Lee Jae-yong, who is appealing convictions for corruption, three chief executives of Samsung Electronics, the group’s biggest business, delivered messages on the seven-minute video. The trio - Kwon Oh-hyun, Shin Jong-kyun and Yoon Boo-keun - is set to be replaced by new chief executives - Kim Ki-nam, Kim Hyun-suk and Koh Dong-jn - today, when an annual general shareholders meeting will vote on a promotion plan already announced last year.

Even though Vice Chairman Lee was released Feb. 5 from police custody after a first appeals court slashed his prison sentence to a two-and-a-half years and suspended it for four years, he has since refrained from appearing in public. He won’t appear at today’s meeting, Samsung said.

Lee believes a low profile is appropriate after the chaebol lost a lot of respect from the general public after being embroiled in the corruption scandal that toppled former President Park Geun-hye. At the same time, many others acknowledge Samsung’s hard-to-ignore contribution to the national economy, and some consider Lee a scapegoat in a political tussle at the highest level.

In the video, Kwon, chairman of Samsung Electronics and Samsung Advanced Institute of Technology, stressed “transformation.”

“Times have changed,” he said, “To keep up with the changes, we should again change the way we think and work.”

Shin, vice chairman in charge of nurturing future leaders, noted Samsung should “jointly grow” with partner companies, saying its success thus far owes much to its business partners’ support.

Yoon, vice chairman in charge of external relations, said, “The efforts and devotion of old and new employees have made possible what was impossible, fostering what is now a global No. 1 player.”

The video also dealt with what Samsung should do to sustain itself until it reaches the 100-year milestone. Shin Dong-youb, a professor of business management at Yonsei University, advised Samsung to introduce a hybrid management model in which it competes against other global players and cooperates with them at the same time.

Tarun Khanna, a professor at Harvard Business School, said Samsung should refrain from modeling itself after other companies - in Silicon Valley, for instance - whereas Kevin Lane Keller, a professor at the Tuck School of Business, noted it was more important that Samsung should contribute to improving people’s lives.

In 1988, the biggest conglomerate in Korea rented the Olympic Gymnastics Arena in Seoul for a big 50th birthday event that had 10,000 employees join in the celebrations. The 60th anniversary celebration did not happen because Korea was in the middle of the Asian economic crisis. The 70th was low-key because Chairman Lee Kun-hee was being investigated by prosecutors for a slush fund scandal. Lee has been bedridden since 2015 after suffering a heart attack.

Samsung dates back to 1938 when Lee Byung-chull, father of Lee Kun-hee, opened the Samsung General Store in Daegu and took over Chosun Alcohol in 1938. The patriarch, born on Feb. 12, 1910 in Uiryeong County, South Gyeongsang, established the Samsung Trading Company - today’s Samsung C&T - in Jongno District, central Seoul, in 1948 and launched Samsung Electronics in 1969.

Lee Kun-hee took over the business in 1987 after his father’s death and Samsung Electronics has taken off as the world’s No. 1 producer of TVs, smartphones and most recently, semiconductors.

Over the past eight decades, Samsung’s assets increased 363.2 trillion won ($337.7 billion). It has 60 subsidiaries and the number of its employees grew from 40 to 500,000 worldwide.


BY SEO JI-EUN [seo.jieun@joongang.co.kr]


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