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Samsung disbands Future Strategy Office

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By Kang Seung-woo

Samsung Group revealed its plans to revamp the group's management Tuesday, including dismantling its controversial Future Strategy Office.

The nation's largest conglomerate said it will no longer operate a unit to handle government affairs in what seems to be an effort to end crony capitalism.

The moves mean the group is decentralizing group-wide tasks, having its myriad of affiliates make their own business decisions.

"We have decided to disband the Future Strategy Office," Samsung said in a statement, adding its top officials — Vice Chairman Choi Gee-sung and President Chang Choong-ki — have resigned.

The plans come as Samsung Electronics Vice Chairman Lee Jae-yong, the de factor leader of the group, is under arrest on multiple charges, including bribery and embezzlement, due to his involvement in the ongoing corruption scandal related to President Park Geun-hye, who was impeached last December, and her confidant Choi Soon-sil.

Minutes ahead of the Samsung announcement, the independent counsel team investigating the scandal said it planned to indict Lee.

The focal point of the reform plan will come down to the disassembly of the Future Strategy Office that comprises some 200 officials picked from Samsung affiliates that has served as the group's top policy-making body by coordinating major affairs among affiliates. Its staff is expected to return to Samsung units where they originally worked.

Lee told lawmakers in December he would shut down the office, which was under fire for its involvement in the scandal, after the independent counsel team wrapped up its investigation.

The probe ended as scheduled, Tuesday, after acting President and Prime Minister Hwang Kyo-ahn refused to extend the team's term, Monday.

With the control tower abolished, responsibility for personnel reshuffles at subsidiary firms will be transferred to each affiliate's board of directors, according to group officials.

The group is also not likely to control group-wide hiring of new workers, letting affiliates recruit their own employees in accordance with their respective needs.

Samsung and the nation's other major business groups hold two hiring events — one in March and the other in September — to accept fresh graduates.

With the decision, the planned employment drive in March will likely be the group's final large-scale recruitment.

One of the strategy office's main tasks was to deal with government affairs, but the abolition will lead to an absence of such a body.

Samsung also unveiled measures to enhance transparency and accountability in managing financial donations and monetary support for corporate social responsibility (CSR) activities and funds.

The group also said Samsung Electronics President Park Sang-jin, who is involved in the scandal, has stepped down. Park, the head of the Korea Equestrian Federation, allegedly played a key role in carrying out Lee's orders on providing financial support to Choi.

Under the revamp plans, Samsung Group will permanently halt its weekly meeting of top executives on Wednesdays.

Prosecutors suspect Lee gave or promised 43 billion won ($36.3 million) worth of bribes to the President's jailed friend in return for the government's backing of a merger of two Samsung affiliates in 2015.

Kang Seung-woo

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