Suggestions and Ethical Frameworks

What Seungri did has brought great economic loss and reputational loss for YG Entertainment. Management problems in this big entertainment have been exposed to the public through Seungri’s scandal and misbehaviors of other YG’s artists. It seems that the public have lost much confidence in YG. In February, YG’s new artist Anda went debut and released her first album. However, many unfriendly comments showed up on her new music video just because she is from YG Entertainment. Although those comments are somehow absurd and unreasonable, we can see the image of YG Entertainment in the public got some problems.

Yang Hyun-suk, left, the founder and chairman of YG Entertainment, and his brother and YG’s chief executive officer Yang Min-suk, right, share a champagne toast in 2014 with Ravi Thakran, chairman and managing partner of L Capital Asia. (Source: CBS News)

YG Entertainment’s responses up to now have showed egoism attitude in teleological frameworks. The key concept of egoism is that self-interest plays a major role in all motivations. They only focus on their own interests and do not know much knowledge of the true needs of others. At first, they denied every negative report on Seungri and announced they will take legal action against fake news. When things can no longer be covered, YG Entertainment terminated the contract with Seungri. I think they made good a decision for themselves and tried their best to minimize economic loss in this case. However, their reputational loss was sunk cost in this situation. It takes time to build a good image of a company in the public. However, YG Entertainment did not show any care to the victim and their self-interests did not benefit the victims. As for their internal management problems, they held an emergency meeting to hold a vote of confidence on CEO Yang Min Suk. It showed their determination to reform in the company. However, more problems need to be solved, such as low work efficiency and artists management besides the top management issues.

If YG Entertainment took deontological frameworks and met all their duties, they would focus on the duties and obligations that we have in a given situation. They should not deny the new if they knew the truth. However, this framework would be impersonal in this situation. YG need to do more to save their image other than obligations only.

My suggestion for YG Entertainment is in accordance with virtue ethical frameworks in this situation. Virtue focus on attempts to discern character traits that are, or could be, motivating the people involved in the situation. It focus on the long-term development of the company. As a leading company in Kpop industry, YG should know how to save company image in the future. It is important for them to know what company they want to be next. Then all the company decisions and actions will be processed under their traits. Firstly, I support YG Entertainment to terminate contract with Seungri once they know what Seungri did to minimize loss. Secondly, YG should strength their artists management. Aspiring K-pop stars often leave family homes to start training at ages as young as 11 and debut as minors. Some of them even did not have chances to receive full education in primary school. Therefore, companies have the obligation to provide system education for their trainees and help trainees tell what is right or wrong. As the education system is improved in the future, I think the next generations from YG will not did wrong things in that way. Thirdly, YG can show their care for victims in this case and let virtue become habitual. People can never have too much virtue, only too little. When they build virtue company image in the future, they will receive more support from the public.

Overall, each ethical framework would show different ways to solve problems in this situation. Virtue ethical framework will provide a long-term development solution for the survival of YG Entertainment in such a competitive Kpop market.

Comments on Seungri’s Scandal

Kpop is one of South Korea’s most recognizable exports, along with Samsung phones and Hyundai autos. It’s a $5 billion industry that helps propel local tourism and sales of consumer goods. Seungri, who was once described as “the Great Gatsby of Korea” for his lavish lifestyle, has a gigantic fanbase. Therefore, his big influences to Korean society brought more public attention to this case. Commentators from many related fields have reacted to this scandal, not only from Kpop industry, but also from society and government.

Here is a video of a street interview in Seoul about the opinions of Seungri’s scandal.

Most of the interviewees showed that they are not surprised with the stars’ rumor but they still got shocked by what these Kpop stars have done. Also, they thought there are big darknesses behind the scandals on the surface. Some interviewees also showed doubt on company management and artists’ agencies. Overall, It doesn’t matter if you’re a civilian or a celebrity. If you commit a crime, you must be punished.

#Metoo Movement

Thousands of women protest against illegal filming (Source: CNN News)

The series of reports on Seungri’s put the country at the epicenter of Asia’s #MeToo movement around the sexual exploitation of women in all levels of Korean society. Korean women who have also been dealing with a nationwide spy-cam epidemic that revealed thousands of 1-millimeter minicams popping up in hotels and offices and restrooms across the country. An estimated 20,000 Korean women last summer marched in rallies to protest the social problem, crying, “My life is not your porn.” “The new atmosphere created by #MeToo helped expose the K-pop scandals,” said Lee Taek-gwang, a cultural commentator. “The tables have been turned and now the K-pop industry has been forced to confront reality. It has to create a new morality.”

Toxic Masculinity

This case also brought discussion about the social issue in South Korea, toxic masculinity. “I don’t think K-pop has a toxic masculinity problem, I think Korean society does,” said Michael Hurt, a sociologist at the University of Seoul. “Korean men have weaponized the camera,” he said, adding that victims of such crimes are often threatened with blackmail. Sharing illicit material about women and treating them as pieces of meat or bargaining chips in a game of sexual bragging is common in Korean culture, the sociologist said. “We are experiencing a K-pop version of it but it’s a Korea-wide problem.”

Government Response

South Korean president, Moon Jae-in (Source: SBS News)

The scandal in Kpop industry drew attention of South Korea Government. Moon Jae-in, the South Korean president, vowed to clean up the entertainment industry after more than 200,000 people signed a petition on the presidential office’s website demanding a thorough investigation into alleged crimes. Along with sexual misconduct and prostitution, these include corruption involving a senior police official who allegedly turned a blind eye to alleged crimes committed at Seungri’s club, Burning Sun. “The current leadership of the prosecution service and police should stake the fate of their organizations on uncovering the truth and becoming a law enforcement agency that can reveal its own shameful acts in order to regain the public’s trust,” said Moon, “Without investigating the facts of the incident involving the elite class of society, we cannot say we have a fair society.”

What Seungri and other people got involved all showed their great disrespect to female. Women are likely to face sexual harassment and discrimination during work. However, the world could be full of dangers when you are in hotel and club. You can be the leading actor of a porn directed by others without knowledge. Even though, most victims chose to stay silent because the lack of law and social pressure. As a Kpop fan, I feel great disappointed on Seungri. I was also shocked how different people can be when in front of camera and behind camera. I hope they will pay for what they have done in this case.

YG Entertainment’s Responses towards Scandals

The whole controversy started from a report on a man who was assaulted by Burning Sun nightclub staff on November 24, 2018, while helping a woman being sexually harassed. Then Burning Sun shut down as the investigation of drug dealing widens to more clubs in the Gangnam area. A month later, the group chat of famous Kpop stars who shared hidden camera sexual videos was reported, which caused an earthquake on Korean entertainment industry. Also, some message conversations were exposed that Seungri has been accused of providing prostitutes to many rich clients for investment on his business.

Seungri’s group chat for providing prostitutes (Image Source: SBS funE)

*Seungri’s group chat for sharing sexual videos (Image Source: SBS funE)*

YG Entertainment has taken series of actions following reports on Seungri’s scandal. On February 1st, YG confirmed Seungri is no longer Burning Sun’s executive director and that he is resigning from all current business roles as he prepares to enter the military. On February 26th, YG denied the reports of Seungri telling employees to find prostitutes for business investors. They released an official statement, “Upon checking with the artist himself, the text messages in the article are fabricated and not true. In addition, we inform you that we will take strong legal action against the proliferation and reproduction of rumors and fake news.” On February 28th, YG announced the cancellation of upcoming The Great Seungri concerts in Osaka and Jakarta. “Seungri underwent voluntary questioning at the police station, and he dutifully participated in the investigation for various suspicions for 8 hours and 30 minutes. In particular, there was strict police investigation into sexual services.” After the reports on the sexual videos group chat, on March 12th, YG Entertainment confirmed that Seungri’s contract has been terminated officially and apologised for not managing their artists to the best of their abilities. “YG Ent. has accepted Seungri’s request to terminate his exclusive contract. We would like to bow our heads in apology for causing severe worry for many due to the numerous controversies and allegations.”

YG Entertainment shareholders held an emergency meeting on March 22 at 9:30 am to hold a vote of confidence on Yang Min Suk. During this meeting, which lasted 15 minutes, they determined that Yang Min Suk was fit to remain in his leadership position. Yang Min Suk will remain the CEO of YG Entertainment. In past months, YG Entertainment’s stock values have fallen 30%, the National Pension Service is asking YG Entertainment how they will recuperate the value lost, and the National Tax Service is currently conducting a special investigation on the company’s accounting practices.

Personally, as the case is still under investigation, it is hard to say whether YG Entertainment all told truth in their responses. However, these scandals caused great disappointment from the public on YG Entertainment and Seungri. YG denied all negative accusations and tried to cover things up at first. When more and more evidences showed up, YG chose to terminated contract with Seungri to minimize losses. I think YG operated with low efficiency, they did not respond to these scandals until the last minute. Every action they took was passive till the public pressure became high. These actions revealed that the poor management within this company. Providing prostitutes to investors is unethical and illegal in Korea. Both Seungri and YG Entertainment showed their unethical attitude because they did not show any empathy to the victims.

Background of YG Entertainment

Establishment of YG Entertainment and BIGBANG

YG Entertainment is a South Korean entertainment company established in 1996 by Yang Hyun-suk. The company operates as a record label, talent agency, music production company, event management and concert production company, and music publishing house. YG Entertainment was started from hip-hop genre into the Korea music mainstream. In 2006, YG Entertainment formed its first boy band, BIGBANG, Seungri’s belonging group. The group’s breakthrough the following year and their consistent popularity have made them one of the biggest and most bankable boy bands in the world. In 2011, YG was successfully listed on stock exchange. 2012 brought YG international recognition when Psy’s “Gangnam Style” gained worldwide popularity as a most viewed video in YouTube history. YG is currently one of the largest entertainment companies in South Korea. In addition, YG operates a number of subsidiary ventures under a separate public traded company, from restaurants to clothing store. YGX, one of YG’s subsidiaries, merged with Seungri’s DJ label NHR. For his business talent, Seungri became CEO of YGX.

YG’s founder Yang Hyun-suk, Seungri from BIGBANG and YGX (Source: Koeraboo)

Mission Statement & Vision Statement

The mission statement of YG Entertainment is “Vibe the new flow”. As a leading company of Kpop industry, YG need passion to take on new challenges and create new trends to keep its position. The Vision statement is “Create experience, evoke inspiration”. The aim is to create a brand experience unique to YG Entertainment by producing special cultural contents, and then become a brand that inspires the world.

Poor Management Issues in History

YG Entertainment pursues a distinct identity in their company values. For the public, YG successfully established distinctive company image. Most artists under YG brand have strong personalities while they gained popularities for being special. However, artists from YG are more likely to get involved in scandals, especially related to drugs. In 2010, YG singer Park Bom smuggled 82 amphetamine pills through Express Mail Service at an airport. In 2011, G-Dragon, the leader of BIGBANG, was caught smoking marijuana in Japan. In 2017, T.O.P, another member of BIGBANG, was charged with marijuana use. Kush, a YG rapper and producer, was nabbed for using cocaine in 2017. As marijuana is illegal in South Korea, Korean netizens teased about these news, “Is YG growing weed on its rooftop?”

Now, Seungri’s scandal particularly causes a worse situation for YG Entertainment. The severity of Seungri’s night club issue cannot be ignored. Stock prices of YG Entertainment fell more than 10% for days after the exposure of Seungri’s scandals. The difficulties YG faced now are the results of its poor artists management. YG Entertainment is facing a tough situation to fix its company image up.

YG Entertainment: Seungri’s Scandal (Ethical Dilemma)

*Seungri at the Seoul Metropolitan Police Agency on 15 March for questioning over criminal allegations (Photo: Jung Yeon-Je via Getty)*

In the past month, South Korea’s entertainment industry has suffered a crisis. A group chat in which members shared sexual videos of women who were allegedly filmed without their consent was exposed to the public. This digital sex scandal that police say involves some of K-Pop’s biggest stars has rocked the Kpop world, leaving it facing a reckoning from which some believe it might not recover. YG Entertainment, one of the biggest Kpop companies, its stock prices have fallen following series reports of Seungri, a member of the legendary group BIGBANG. BIGBANG is one of the groups that helped propel K-pop into the mainstream music scene that it has become today. However, besides a successful Kpop star, Seungri is also a businessman. He took on leadership roles in various enterprises ranging from sub-label YGX to a ramen shop, including a nightclub, Burning Sun.

Seungri’s night club in Gangnam *(Source:* ALLKPOP)

The national scandal started with this popular nightclub in Gangnam area of Seoul called Burning Sun. An investigation commenced after a man claimed to have been assaulted by the nightclub staff when he tried to stop another female patron from being sexually harassed in November 2018. In February 2019, it shuttered amid accusations by police that some on the club’s staff secured prostitutes for VIPs, rape, drug trafficking and drug use. It’s alleged that the club staff drugged young women so that VIP club members could rape them. Local media reported a VIP member said that he regularly received texts from the club to say that they had women “ready” for him. One text included a video of an intoxicated woman being assaulted, unaware that she was being filmed because she had been drugged.

As Seungri is in a leading position of Burning Sun, he was sent to the police for further investigation. YG Entertainment received a lot of pressure from the public since Seungri is not the first YG artist who got involved with drug-related scandals. Seungri’s scandal made the public lose their confidence in YG Entertainment because of it bad management of artists. YG Entertainment shareholders have scheduled a meeting to vote on replacing their CEO Yang Hyun Suk. YG Entertainment is famous for its popular Kpop music, but the scandals are affecting the company image and the stock prices negatively. The ethical dilemma faced by YG Entertainment now is how to response to the series scandals and rebuild the company image. YG also need to improve its artist management to avoid scandals again.