Tuesday, 21 January 2014

Ethics and managerial responsibility – South Korea’s different standard

Senior managers taking responsibility for failings of their underlings by themselves resigning is a novel occurrence in even the most scandal ridden western companies but things are different in South Korea. Up there managerial responsibility actually appears to mean something.
The Korea Times reports this morning that the chief executives of four financial services companies offered to resign on Monday over massive consumer data leaks that have hit the local financial sector.
21-01-2014 korea
They are KB Kookmin Bank CEO Lee Kun-ho, KB Kookmin Card CEO Shim Jae-oh, NH NongHyup Card CEO Sohn Kyung-ik and Lotte Card CEO Park Sang-hoon. Along with Lee and Shim, all executives of KB Financial Group’s credit card and banking subsidiaries decided to step down. Eight other executives at Lotte also offered to resign to take responsibility for the country’s worst ever customer data leak.
“They have tendered their resignations en-masse to the group Chairman Lim Young-rok,” said a spokesman for KB Financial Group. “It’s not yet clear whether Lim will accept all of them.”
In addition, all executives of the Korea Credit Bureau, a private financial data provider, have decided to step down, accepting liability for the incident that may have been perpetrated by an employee.
KB Kookmin Card is one of three card firms that experienced the data theft, which may affect more than 20 million card users. The other two firms are Lotte Card and NH NongHyup Card.
“Sohn offered to resign to take responsibility for the theft case, and the company accepted his resignation,” an NH NongHyup official said.
The case couldn’t come at a worse time for KB Financial, which is still reeling from a series of high-profile corruption scandals involving its banking staff.
“Unfortunate things recently occurred at KB one after another, causing concern to many people. We hope the resignations will help produce a turnaround,” the KB official said.
Their resignations came hours after Prime Minister Chung Hong-won called for strict punishment for those responsible for the consumer data leaks.
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