Under the Korean corporation law, a director or an officer is considered as a fiduciary to a corporation which he is elected for. Therefore, he is obliged to do his discretion on the business decision to seek the individual interests of the corporation. If he does it against the individual corporate interests, he would be charged for the abuse of his discretion. It would be complicated if a director or an officer would be elected for a subsidiary but obliged to seek the group interests instead of interests of the subsidiary. In this occasion, the legal principle doesn't reflect on the reality in Korea. There are huge numbers of corporate group in Korea whose annual gross turnover is composed of more than 50% of GDP. Directors and officers are sometimes requested to consider the group interests. Of course, subsidiaries take a lot of advantages like brand force, credit, sales volume, financial support etc.
Recently, the final decision of Korean Supreme Court was delivered on a case. Directors of a subsidiary that belongs to Samsung Group were tried on the cause of the neglect of their fiduciary duty in the case. They did financial assistance to other subsidiaries to fail to recover. Finally, some causes were approved and others denied. Reviewing the reasoning, I can find the logic not clear. Therefore, I prepare this paper to establish the legal approach to the important issues. To sum up, Directors or officers could be allowed to do their discretion on the pursuit of group interests if the total benefits exceed the gross losses on the entirety of the corporate group through the transaction.