Federation of Korean Industries “Apologizing for the Companies’ Involvement in Political Funds”

Sohn Gil-seung , president of SK group who has been undergoing the prosecution’s investigation related to the SK secret money, resigned from the presidency position of the Federation of Korean Industries on October 30.

President Sohn spoke at the private meeting of the presidents’ circle on the resignation, saying, “I sincerely apologize for the trouble and worries that I brought to the member companies and the people. This incident all derived from my lack of virtue whatever the reason was.”

He is resigning after eight months and 20 days as president of the federation, publicly damaged from the SK incident, since he took it over on February 7th, following Kim Gahk-joong. This is the shortest term ever as a president of the federation.

President Sohn said, “I hope that no company or corporate people will ever be sacrificed over the problems in the past and that I should be the last for this case.”

He has been active in the presidency under the campaigns of “Establishing Korea-China-Japan Far East Joint Economic Zone” and “Achieving 100 billion dollar of GNP,” but he had to withdraw from the position during the middle of his term because of the SK incident.

After publicizing the resignation, the presidents at the meeting started discussing the potential successor. The federation had suggested the “Big Three” of Samsung’s Lee Kun-hee, LG’s Koo Bon-moo, and Hyundai and Kia Motors’ Chung Mon-koo. However, those three have refused the offer, and other CEOs from the federation, except the three, have now been included in the discussion.

After the meeting, the federation made an announcement apologizing to the people for the companies’ involvement in the recent political fund problems.

An account from the federation said, “We have agreed that we needed a process to ask for pardon from the people since the political fund issues in which the companies have been involved have stirred up the whole country.”

In addition, the Federation of Korean Industries has agreed to promote improvement policies of the political fund system to establish political practices that will not cost much money and to stop illegal political funds within the scope of the industries. The federation has asked an outside institute for this purpose.

The improvement policies of political funds being discussed at the institute are indirect offers from the individual companies through a third party such as economic associations, compulsory permission of political fund expenses from the stockholders’ meeting, depositing 1 percent of the corporation tax as political funds as previously suggested by the National Election Commission.

Jong sik Kong kong@donga.com