Some argue local accounts do not match actual donations as headquarters have responsibility


Foreign brokerages in South Korea are still not very generous in terms of charitable donations, according to a recent report.

The total amount of donations made by Seoul branches of the top five foreign brokerages ― Goldman Sachs, Merrill Lynch, Citi Global Market Securities, Credit Suisse, JPMorgan Asset Management ― from April to December last year was only 6.5 million won, according to the 2011 fiscal year report released this month by the Korea Financial Investment Association.

In the same period, the five firms had total sales of 11.49 trillion won and net profit of 229.1 billion won. 

The report showed that Goldman Sachs and Merrill Lynch donated nothing. Credit Suisse and JPMorgan each donated 1.5 million won and 5 million won, respectively. The foreign brokerage which donated the most was UBS with 143.6 million won, 0.36 percent of its net profit, followed by Macquarie Securities Korea with 28.2 million won.

“Donation” in the report refers to the total figure shown in the accounts after offering the company’s money or goods to a volunteer group or social organization.

While most of the companies kept silent about the matter, some explained that the report could be misleading as it only covers the accounts of the Seoul branches. The budgets for donations in Korea are managed by the headquarters overseas, they said.

An official at Weber Shandwick Korea, a PR agency for Goldman Sachs’s Seoul branch, said that the company has been making donations to more than one organization almost every year, including Holt Children’s Services in 2007 and Saemmul Hospice Mission in 2008.

“Goldman Sachs does not wish to reveal the exact amount of donations as it is not something to open to the media and brag about. The company has been doing many good deeds like helping patients with AIDS or leprosy but was just not known as it did not publicize the activities,” said the official.

The Seoul branch of Credit Suisse gave a similar explanation for why the local accounts and the company’s actual donation activities here do not match.

“We are doing many volunteer works including the support of the Habitat movement worldwide which is also held twice a year in Korea. We also do fundraising in the case of natural disasters like the Thai flood. However, most of those events are linked with the global or the Asia-Pacific headquarters so are not included in local accounts,” said Uni Park, a PR official at Credit Suisse.

The given numbers, still, seem meager compared to local firms.

The total amount of donations by securities in Korea over the same period was 31.9 billion won, which marked a 10.6 percent increase on last year. Samsung Securities topped the list by donating 5.56 billion won.

Market insiders say that local firms donated more due to the emphasis on social responsibility of financial institutions, although most suffered lower profits last year.

Kim Seok-dong, chairman of the Financial Services Commission, pointed out in December the weak social contribution from the financial industry last year and asked for more.

“It is a pity that U.S. or European securities companies which attach much importance to social responsibilities somehow seem to be stingy in terms of donations in Korea,” said a market insider.

By Park Min-young  (claire@heraldcorp.com)