[EDITORIALS]The lesson from Doosan

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[EDITORIALS]The lesson from Doosan

The prosecutors’ investigation into the alleged embezzlement and fraud at Doosan Group has come to an end as the four brothers of the family-owned company, including former Chairman Park Yong-sung, were indicted without detention.
The penalty is generous considering that they had allegedly embezzled 32.6 billion won ($31 million) and fabricated 283.8 billion won of the company’s accounting for a decade. The prosecutors said the light punishment took into account the fact that the suspects actively cooperated with the authorities in the investigation and also that Park Yong-sung was the chairman of the International Chamber of Commerce and the member of the International Olympic Committee. The prosecutors seemed to be concerned that the arrest of a prominent businessman might not only damage the nation’s interest but also degrade the national image.
The prosecutors must have been aware that there would be criticism over the investigation’s leniency or balance. A corrupt businessman and a company must be dealt with separately. A businessman who committed an illegal act should be punished according to the law, but it is not necessary to criticize or kill the company. The prosecutors’ decision was appropriate considering that companies have been shrunk due to the demand for corporate governance restructuring and the eruption of a scandal involving wiretapping by the intelligence agency.
The indictment without detention is not an acquittal. Mr. Park in his resignation as the company’s chairman announced Doosan’s intention to have transparent management and improve its governance structure. The company must keep its promise. The previous custom whereby the controlling family’s decisions outweighed the board of directors’ and company funds were used as if they were the owners’ personal property should vanish. The company has to put its full efforts into improvement. It is the only way the group can reduce anti-corporate sentiment and regain public trust.
Other companies should learn a lesson from this case. Numerous companies have changed their bad habits only when they were under investigation by prosecutors or subject to a court ruling. We hope this will be the last case of corporate fraud and that the prosecutors’ indictment without detention is the last warning. Scanning public sentiment, it would be hard to expect any more generosity. Companies should return the public’s benevolence through transparent and active management.
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