The Business Ethics Blog

Corporate philanthropy often generates cynicism: we often wonder whether a given corporation is donating to a good cause just to be seen giving to a good cause, in order to improve public perceptions of its overall character.

But seldom is a public showing of atonement so blunt as the one described in this story from BusinessWeek Online: “Samsung Group to offer $800M to charity”

FEB. 7 10:08 A.M. ET South Korean conglomerate Samsung Group said Tuesday it would donate more than $800 million in corporate and private assets to charity as part of an apology for several recent scandals.
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“Samsung Group deeply repents for causing concern to the people,” the conglomerate said in a statement posted on its Web site. “In order to comply with the views of society and the people, (the group) decided to offer 800 billion won [about $830 million U.S. dollars] worth of assets to society.”

The announcement was, of course, greeted with a degree of skepticism:

Following Samsung’s announcement, the People’s Solidarity for Participatory Democracy, a civic group, accused Samsung of failing to present “basic solutions” to improve how the conglomerate is run, Yonhap news agency reported.

“The announcement was just symbolic and there are no efforts to resolve the Samsung matters,” the group said in a statement on its Web site, according to Yonhap.

Just how skeptical should we be? Here are a few considerations:

1) It’s not clear (yet?) just how the “punishment” is related to the “crime.” It’s not clear how the donation is supposed to right the wrongs done by Samsung. Consider an imaginary alternative: imagine a company involved in an environmental catastrophe going beyond the need to clean up their mess, and making a large donation to Greenpeace. Similarly, a corporation with a poor reputation in terms of gender or racial discrimination might (in addition to revising internal practices) make a donation to a scholarship fund or other program aimed at helping the groups it had formerly discriminated against. These would be examples of a very clear & specific kind of atonement. Just how are the charities Samsung intends to donate money to related to the specific wrongs that Samsung is accused of?

2) The public admission of guilt we see in this case is an admirable rarity. Of course, the offence being admitted to is quite vague, but it’s pretty rare to see a major corporation admitting to a failure “to comply with the views of society and the people.” That’s got to be worth something.

3) It seems noteworthy that the donation will be a combination of corporate and private money. In other words, this isn’t just a case of a corporate executive giving away someone else’s money (i.e., shareholder money) to make amends for his mistakes. In this case, Samsung’s chairman (and his family) are kicking in a considerable amount of their personal wealth.

4) It’s too easy to be cynical about this. Is Samsung trying to improve its image? Sure. But how is it doing that? Seemingly, by doing things that genuinely warrant our respect. There’s got to be a difference between trying to make people like you by doing things that look good, and trying to make people like you by actually going good. Whether Samsung’s specific choices in this case are sufficiently good to buy it real credibility is a bigger question.