Hyundai Heavy vows to root out corruption

Hyundai Heavy Industries Chairman Lee Jai-seong, center front, and some 150 executives from the shipbuilder's affiliates swear to root out corruption in a meeting held in Ulsan, Saturday.
/ Courtesy of Hyundai Heavy Industries

By Choi Kyong-ae

Hyundai Heavy Industries (HHI) said Sunday it has launched a campaign to root out corruption.

In a meeting held in Ulsan Saturday, Hyundai Heavy Chairman Lee Jai-seong and some 150 executives from affiliates of the world's biggest shipbuilder by sales adopted a resolution not to give or take bribes.

"We have to generate an environment where corruption does not take root, and reemerge stronger and more transparent through a drastic renovation," Lee said in a statement. "We will punish employees found to be involved in bribery as a warning to others."

The announcement comes after HHI employees were recently found to have offered bribes to officials at Korea Hydro & Nuclear Power (KHNP) to win an order during the previous government.

KHNP is the state-run operator of Korea's nuclear power plants that supply about 30 percent of the nation's overall electricity demand.

"In the bribery cases, several Hyundai Heavy employees bribed a KHNP official in charge of the supply of parts for nuclear reactors to be exported to the United Arab Emirates (during the Lee Myung-bak government)," a company spokesman said by telephone.

Other Hyundai Heavy employees turned out to have bribed other KHNP officials in their failed efforts to bag an order of an emergency diesel-powered generator for the UAE reactors, the spokesman said.

Hyundai Heavy, the country's 7th-biggest conglomerate by assets, said it will also run an "anti-corruption compliance program" as part of a companywide campaign.

"Under the program, executives and employees are obliged to take courses on the code of conduct regarding ethics on an annual basis. And there will be regular monitoring of them," the spokesman said.

Hyundai Heavy received $26.1 billion worth of orders in the shipbuilding and offshore plant businesses combined in 2013, a 76 percent jump from $14. 8 billion a year earlier, he said.

But for this year, the shipbuilder has set a conservative target of $25.05 billion as the shipbuilding sector is still suffering an oversupply of ships and lower rates on the market.

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