South Korea’s top 10 conglomerates cut philanthropy

South Korea’s top 10 conglomerates reduced the amount they gave in charitable donations, despite posting solid profit gains in recent years, the country’s financial watchdog said Tuesday.

According to the Financial Supervisory Service, total donations made by the large family-owned businesses reached 608.5 billion won ($568.1 million) last year, down 5.1 percent from 641.0 billion won tallied in 2008.

The FSS’s data analysis, retrieval and transfer system also showed that operating profits of these companies jumped 70 percent in the same period, which would have allowed them to spend more money on charity causes to help the underprivileged.

It said that in 2008, the conglomerates’ 75 affiliates donated an average of 3.2 percent of their operating profits, but the numbers dipped to 2.0 percent in the following year and 1.8 percent in 2010.

Conglomerates such as Samsung, Hanjin, Doosan, Lotte, GS and Hanwha all donated less of their earnings in the three-year period.

The 15 affiliates of Samsung Group, South Korea’s No. 1 conglomerate, gave a combined 113.4 billion won last year, down from 210.0 billion won in 2008.

The four affiliates of Hanjin Group, the country’s 10th largest conglomerate, cut donations from 23.0 billion won to 17.7 billion won, while Doosan Group gave 39.6 billion won to charity last year, a decrease of 67.7 percent from three years earlier.

During the same period, Doosan’s operating profit jumped 61.8 percent to 1.55 trillion won.

Of the conglomerates checked, the FSS said SK Group, the country’s third-largest conglomerate, donated 188.0 billion won last year, or 3.4 percent of its operating profits.

The total amount and percentage given by SK was the highest among the 10 conglomerates examined.

Related to the decrease in donations, market watchers said that few South Korean conglomerates have consistent policies on philanthropy, with lump sums pledged if affiliates or the owners of the business groups are involved in scandals or violate the law.

They added that donors on occasion even trim their charitable gifts from the originally pledged sums once public criticism for the crime or misdeed dies down. 

(Yonhap News)