Korea's biggest conglomerate will shake up its governing structure as an act of taking responsibility for its involvement in the recent corruption scandal
Samsung Group on Tuesday announced it will disband its controversial control tower Corporate Strategy Office as part of taking responsibility for its disgraceful involvement in a corruption scandal that led to an impeachment trial of President Park Geun-hye and arrest of the group's de facto leader Lee Jae-young.
The announcement was made after the special counsel wrapped up its 70-day investigation into the scandal on the same day as it failed to win acting President Hwang Kyo-ahn's approval for an extension.
According to the announcement, the group will shut down the Corporate Strategy Office better known as the future strategy office, and its chief Vice Chairman Choi Gee-sung, President Chang Choong-ki and about 60 other executives will resign from their posts.
The group-led meeting of CEOs of Samsung subsidiaries will also be abolished, giving each subsidiary autonomy to operate centering on their boards of directors, the announcement said.
The group also pledged to disband Samsung's government relations division to amid its alleged role of lobbying public offices including the parliament, central government and municipalities.
Samsung would delegate such activities to local law firms, cutting its direct links to government offices, according to local reports quoting insiders.
The group has been facing public criticism that the group may have maintained its cosy relationship with politicians and officials in exchange for business favorus and policy support.
Samsung, however, had denied the reports, calling them "groundless."
After the control tower is dissolved, around 200 rank-and-file workers and executives there are expected to return to Samsung's units where they originally belonged.
As part of the reform plan, Samsung also pledged to require approval from each affiliates' boards or umbrella committees in executing external donations above a certain amount.
Park Sang-jin, president of Samsung Electronics, tendered his resignation from the corporate post as well as the president of the Korea Equestrian Federation, the group also said.
Samsung executives and employees who have been dispatched to the KEF will also return soon.
The group, however, did not mention about abolishment of the annual recruitment that has been led by the group.
It was expected that the annual recruitment would also be abolished, leaving such a role to affiliates ranging from manufacturing tech devices to biopharma products.
There were also media speculations that the reform package would include the return of Samsung Group Chairman Lee Kun-hee's 1 trillion won ($1.3 billion) fund that he had promised to give back to society to appease public anger over the 2008 slush fund scandal.
His son, Lee Jae-yong, had said in December that he would discuss the fate of the fund with his family since the chairman has been bedridden after he suffered a heart attack in 2014.
It was also said the group was considering to offer an additional donation to placate public criticism over allegations that a 2015 merger between Samsung C&T and Cheil Industries had inflicted financial damage to minority shareholders of the construction arm of the group and the National Pension Service.