Korea's big 4 groups set to return to the FKI after six years

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Korea's big 4 groups set to return to the FKI after six years

Published: 21 Aug. 2023, 17:44 Updated: 22 Aug. 2023, 12:28

JIN EUN-SOO
jin.eunsoo@joongang.co.kr

The office of Federation of Korean Industries in Yeouido in western Seoul [NEWS1]

Korea's big four business groups — Samsung, SK, Hyundai Motor and LG — are set to rejoin the Federation of Korean Industries (FKI) six years after withdrawing from the business lobbying group that was mired in a massive influence-peddling scandal during the Park Geun-hye administration.

Samsung Electronics held an extraordinary board meeting on Friday to discuss the agenda after its independent compliance committee consented to the group’s conditional return to the organization.

SK, Hyundai Motor and LG have also discussed the reentry agenda internally.

Their decisions to rejoin the FKI will be made official at the organization's press conference scheduled for Tuesday morning.

The big four companies withdrew from the FKI in 2017 but remained members of the Korea Economic Research Institute (KERI), a think tank affiliated with the FKI.

As the FKI is planning to acquire KERI, KERI's member companies will be naturally absorbed into the FKI as long as they don't object to this membership transfer.

"It would be hard for the companies to outwardly voice their objection to the agenda," according to one industry insider who wished to stay anonymous.

The FKI is scheduled to hold an extraordinary general meeting on Tuesday morning where its acquisition of KERI and appointment of Poongsan Group Chairman Ryu Jin as its new chairman will be voted on,

The FKI is looking to regain its reputation as one of the most influential business groups representing the voices of Korean companies, which was severely tarnished when it was slammed for serving as a go-between for the Blue House and Korean conglomerates, forcing them to make donations to culture and sports foundations that were later found to be misappropriated and embezzled.

Samsung's withdrawal was announced by then Vice Chairman Lee Jae-yong during a rare public hearing where the heads of nine conglomerates were present.

The incident not only led to Samsung's exit but also prompted the founding of the Samsung Compliance Committee to prevent any inappropriate links between politics and businesses.

The FKI not only lost Samsung but also LG, SK and Hyundai Motor as members at the time, all of whom retained their KERI memberships.

The Samsung Compliance Committee on Friday consented to Samsung's return to the FKI, with the condition of an immediate withdrawal should any inappropriate politics-business links emerge.

However, Samsung Securities objected to the membership transfer and will not rejoin the FKI, according to local reports Monday, becoming the first company among the four business groups to publicly refuse rejoining.

BY JIN EUN-SOO [jin.eunsoo@joongang.co.kr]