Internal investigation yields no definitive intent to mock Korea’s democratic movements
Shinsegae Group Chairman Chung Yong-jin formally apologized Tuesday regarding the highly controversial “Tank Day” marketing campaign by Starbucks Korea, accepting full accountability for the incident.
During a press conference held at Josun Palace in Seoul, Chairman Chung Yong-jin stated, “To the bereaved families of the historic May 18 Democratic Movement and the late activist Park Jong-chul, to the citizens of Gwangju, and to the entire Korean populace, I extend my heartfelt apologies and ask for forgiveness as the chairman of Shinsegae Group.”
“I offer no excuses. The full responsibility for this egregious matter rests solely with me. It is my fault,” Chung declared. “All members of Shinsegae Group, myself included, pledge to forever remember the profound history and sacrifices of our society, and to deeply understand and respect the sentiments of the Korean people.”
Chung also advocated for the frontline Starbucks Korea employees, who continue to serve customers amidst the controversy. He urged the public to show understanding and compassion towards them, recognizing their role as staff members.
He further committed, “We will undertake a complete overhaul of our internal systems and risk management frameworks, strengthening our standards for corporate social responsibility from the ground up.”
Chung concluded, “This apology marks not an end, but a new beginning. We are committed to taking concrete steps to enact genuine changes and rebuild public trust, starting anew from this point.”
Despite Shinsegae’s announcement of the preliminary findings from its internal investigation into the “Tank Day” incident, the conglomerate stated it was unable to definitively conclude whether the contentious marketing phrases were intentionally designed to disrespect Korea’s revered democratic movements.
Shinsegae revealed that three members of Starbucks Korea’s commerce team, responsible for proposing “Tank Day” to promote their Tank tumblers, declined to submit their smartphones for forensic analysis, citing privacy concerns. Their statements suggested they intended to use catchy, phonetically similar phrases, sought ideas from artificial intelligence tools, and did not foresee any issues with the chosen terminology.
Concerning the approval process for the controversial marketing campaign, Shinsegae detailed that the commerce team’s proposal received sign-offs from the team leader, manager, division leader, and CEO before its launch. The retail giant conceded that no concerns were raised regarding the “Tank Day” marketing pitch prior to its May 18 rollout, highlighting a systemic oversight.
Furthermore, it was noted that some individuals involved in the approval chain did not open the email attachment containing the problematic phrases. The legal team also failed to review the material, as Starbucks Korea reportedly prioritized the rapid launch of the marketing campaign over thorough scrutiny.
Starbucks Korea encountered severe public backlash and criticism for its “Tank tumbler” product promotion, launched on May 18. The campaign’s phrases, “Tank Day” and “Bang on the desk,” drew widespread condemnation. “Tank Day” was heavily criticized for its grim association with the military tanks deployed to brutally suppress the Gwangju Democratic Uprising on May 18, 1980, an event that resulted in hundreds of civilian casualties. The phrase “Bang on the desk” disturbingly echoed an expression used by the military regime to cover up the torture-induced death of student activist Park Jong-chul in 1987.
Following the outcry, Starbucks Korea issued its initial apology on May 19, with Starbucks’ U.S. headquarters following suit with an apology the very next day.
In response to the scandal, Starbucks Korea’s division leader and CEO were promptly terminated, and other employees implicated in the controversial campaign have been suspended from duty, Shinsegae confirmed.
Acknowledging the inherent limitations of an internal probe, Shinsegae committed to full cooperation with the ongoing police investigation into the matter. Separately, a civic group has already filed a police complaint against Chairman Chung Yong-jin and former Starbucks Korea CEO Son Jeong-hyun, citing charges that include defamation.
Emart, a key retail subsidiary of Shinsegae Group effectively led by Chairman Chung, maintains a substantial 67.5 percent stake in Starbucks Korea. Amidst a growing nationwide anti-Starbucks consumer movement, Shinsegae officials reported a significant drop in Starbucks Korea’s sales since the previous week, though specific figures were not disclosed.
Shinsegae affirmed that Starbucks’ U.S. headquarters is also treating the issue with utmost seriousness, with both entities actively exchanging updates on the unfolding situation.
The Korean retail conglomerate stated there were no developments to report concerning the potential activation of Starbucks’ call option to repurchase shares in Starbucks Korea from Emart. This refers to the July 2021 agreement, where Emart acquired an additional 700,000 shares in the then-unlisted Starbucks Korea from Starbucks Coffee International (SCI), Starbucks’ overseas business and licensing division, for 474.3 billion won ($314 million). That transaction included a clause granting SCI the right to buy back Emart’s 67.5 percent stake at a 35 percent discount to a mutually agreed fair market valuation.
hwkan
