Kakao moves to increase social responsibility amid tougher regulations
Updated: 2021-09-17 17:03:44 KST
South Korea's top platform giant Kakao said it will raise 256-million U.S. dollars to help smaller businesses amid rising criticism over its sprawling business operations.
The funds are expected to be directed towards traditional, offline, and individual mom-and-pop stores and services that are among the most affected by what's characterized as Kakao's "monopolistic business structure."
For more about the corporate social responsibility, or CSR, of Kakao we are joined by Professor Kim Chadong from Hanyang University Law School.
Can you tell us more about 'K Cube Holdings' investment firm owned by Kakao Chairman Kim Beom-su's family members which will be what he calls a "social enterprise?"
(With 118 affiliates, Kakao decided to repurposed its de facto stakeholder of Kakao by 10.59%, 'K Cube Holdings' a now investment firm fully owned by Kakao Chairman Kim Beom-su and under their family members to be a social enterprise.)
Kakao's recent move comes as the country's antitrust watchdog launched a probe against it.
Kakao was alleged to leave out necessary information or falsely report certain details about the company.
First of all, what is the background of the "antitrust law" that is being mentioned here?
What could happen to Kakao if found to be at fault?
(If found at fault, the FTC could take legal action or impose fines against Kakao in accordance with the fair trade law.)
Kakao is not only a popular messaging app here in South Korea, it's also known to provide public services like making reservations, booking taxis and online shopping.
How would the legal action affect its business practices?
Kakao Mobility, with the most opposition from the small business owners, has decided to stop delivery services for flowers and snacks.
And for taxi hailing app Kakao T, the "smart call" function will be terminated.
Are the new regulations being implemented too late?
South Korea's platform operators Kakao and Naver's shares have been dipping recently. What's the lookout of these companies' growth with the government's tougher regulations on sales of financial productions on online platforms?
(Kakao Pay didn't have a license/permission to have services comparing/recommending financial products. It postponed their IPO at the end of this year.)]
We recently reported that a study finds that of Korea's 50 richest stockholders, more than half could be considered self-made. Could the traditional family-based "chaebol" social phenomenon diminish from the country?
Alright, it was Professor KIM Chadong. Thank you for your insights.