[ad_1]
In its half-decade of escalation, the most recent chaebol The scandal oscillated between spectacle, shame and Samsung. Bites an unsupervised puppy; large cash payments; a shaman at the heart of government; the historic indictment and imprisonment of a president; a show jumping gift horse; millions of protests in the streets.
Last week, in an outcome that underscored the scale of the scandal, authorities jailed Lee Jae-yong, de facto head of the Samsung group and the country’s most powerful business leader, for corruption. It was a disproportionate debacle for an extremely disproportionate company.
It’s tempting, Samsung watchers say, to think of this whole long affair as the Korean company’s Ragnarok moment: a messy downfall of industrial gods and the glittering structures they’ve built, out of which a new, cleaner world. could be born. The reality is that Samsung could come out of it all even more powerful and more central in the Korean national project.
Lee’s forced membership in jailed Korean business leaders’ club reignites debate over the extraordinary position of Samsung, the largest family-owned company chaebol business empire, accounting for more than a quarter of the value of the Seoul Stock Exchange. The nation’s clearly defined love-hate relationship with the company has become more deeply rooted.
The scandal has galvanized critics who say Samsung’s ladder is over-focusing talent and suppressing innovation elsewhere in Korea. But the company’s appeal to the country’s top graduates survives, and many view the attack on Korea’s most precious gem as politically motivated. At its most fundamental level, the scandal raises the question of how far Samsung – as the world’s largest maker of memory chips and smartphones – should simultaneously define the ambitions of the Korean economy and be in state control. .
There are a number of arguments, says Sea-jin Chang, a professor at the National University of Singapore, to support the scandal theory as a turning point and the idea that Samsung’s importance will decline from here. . The sprawling trading system the group represented, and which was revered as a nation-building tool, has been made obsolete, slavishly attached to non-essential parts of the empire, and vulnerable to disruption in a digital world. Especially if the government cools its approval of its world champion company.
At the same time, attitudes towards Samsung may harden as the heirs of the group’s late patriarch face an approximately $ 10 billion inheritance tax bill that could force the sale of large parts of the group. the company, reducing its feeling of impregnability. Additionally, the 18-month jail term for Mr. Lee, 52, leaves Samsung at risk. While not necessarily reducing its overall influence over the conglomerate, this removes it from the kind of split-second decision-making that global trade demands.
Perhaps the hardest blow lies in the roots of the scandal: the machinations demanded by the cross-shareholding structure through which the Lee family maintains control of the group. Lee said in May he had no plans to hand over control to his children. His comments were met with skepticism. In fact, said Geoffrey Cain, author of Samsung Rising, the means by which he could do so were probably closed even if he wanted to. This leaves Lee in a jail cell with the devastating, losing thought that after him Samsung could become the first big chaebol without a family owner.
In the face of all of this, said Jun Kwang-woo, South Korea’s former chief financial regulator, Samsung’s market power and importance to the economy will grow. Selling businesses would force Samsung to follow a learning curve of divestment and downsizing that it should have gone through a long time ago.
The Covid-19 pandemic has created huge demand for the main products – televisions, smartphones and screens – of Samsung’s flagship electronics business. A global chip shortage is testament to the growing demand for products in which Samsung is dominant. Its investments in artificial intelligence seem premonitory. The global rollout of 5G mobile services is a chance for Samsung to gain even more market share.
According to strict portfolio management theories, Mr. Jun said, South Korea’s reliance on Samsung could look like a reckless concentration of resources – until it pays off and protects. the economy of a crisis that has hit other countries.
It’s easy to forget how Samsung and others chaebol, like LG Electronics, collapsed during the Asian financial crisis of 1997. In fact, they emerged significantly stronger. It wasn’t Ragnarok; it is not either.
Source link
