Samsung Group starts sweeping reshuffle amid scandal

Samsung Group began Wednesday a personnel reshuffle by replacing the heads of audit and human resources departments in the wake of Chairman Lee Kun-hee’s declaration to root out corruption.

A sweeping shake-up is expected after Lee returns from a one-week trip to Japan next week.

The group appointed Samsung Electronics Executive Vice President Chung Hyun-ho to head the management department team, which audits affiliates. Executive Director Chung Keum-yong will lead the personnel resources assistance team that manages human resources and corporate culture.

Chung Hyun-ho has led the digital imaging division at Samsung Electronics and is considered a capable finance expert with an MBA from Harvard University.

Chung Keum-yong has headed human resources affairs at Samsung Electronics, Samsung Group’s secretariat office, and the group’s restructuring headquarters over the past 15 years.

Lee In-yong, vice president and head of the communication team, said, “After Chairman Lee complained that the group’s clean corporate culture was tarnished, related managers in charge of corporate culture tendered their resignations. The reshuffle is to replace those who resigned.”

Lee Yeong-ho, the outgoing head of the management support team, and Jeong Yoo-seong, who resigned as head of the human resources assistance team, will return to Samsung Electronics.

Samsung will seek to bolster its management support team under the group’s future strategy office as a separate body.

Sources in and out of Samsung consider the reshuffle a prelude to a comprehensive personnel shake-up in the wake of the corruption scandal of Samsung Techwin. The reshuffle is the first since Chairman Lee gave promotions to audit personnel and autonomy to auditors.

In particular, the replacement of human resources personnel signals that a full-fledged shake-up will begin soon.

Those in charge of personnel affairs at Samsung have generally been vice presidents and those leading audits have been executive directors. In the reshuffle Wednesday, however, the rank of the head auditor is higher than that of the personnel affairs head.

This is because Chairman Lee demanded that the rank of audit personnel be raised. In compliance with his demand, auditors will fire employees they deem unqualified and the personnel affairs team will fill the vacancies, experts said.

Considering the importance of their work, Chung Hyun-ho and Chung Keum-yong are relatively young. Both of them were born in the 1960s.

This is why the sweeping reshuffle including a generational shift is expected at Samsung, which has shunned irregular personnel reshuffles other than regular ones at year`s end.

A Samsung source said, “The two appointed Wednesday command the strong trust of senior executives and read Chairman Lee’s thoughts. They are expected to lead a broad range of reshuffles by considering expanding the maneuvering room of Chairman Lee’s children, including Samsung Electronics President Lee Jae-yong.”

Another source said, “Sweeping assessments and intensive inspections of each affiliate by the management assessment team will continue. Certain affiliates will see their CEOs replaced.”

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