[Asia Economy Reporter Jeong Hyunjin] Koo Kwang-mo, Chairman of LG, who will enter his fifth year in office next year, has established a lineup to create innovation suitable for the 'post-COVID' era through the regular executive personnel reshuffle on the 25th. This is the largest-scale promotion among the executive personnel reshuffles conducted since his inauguration in 2018, boldly appointing young talents and laying the foundation to boldly implement 'customer value' and 'future readiness.'
Kwon Bong-seok, the current CEO of LG Electronics, was promoted to Vice Chairman and moved to the position of LG Chief Operating Officer (COO), the counterpart to Chairman Koo, and is expected to focus on expanding future businesses such as automotive components, artificial intelligence (AI), and robotics, which have seen increased investment since Chairman Koo's inauguration. Along with Vice Chairman Kwon, Jo Joo-wan, Chief Strategy Officer (CSO), was appointed as the new CEO of LG Electronics, while other major affiliate CEOs were retained, reflecting a balance between stability and innovation.
LG COO is Vice Chairman Kwon Bong-seok... "Strengthening Future Readiness"
LG conducted its 2022 executive personnel reshuffle through board meetings of each affiliate on the 24th and 25th. LG Corporation held a board meeting on the morning of the 25th and appointed President Kwon as the next CEO. President Kwon was promoted to Vice Chairman in this reshuffle. Vice Chairman Kwon will take over the role of LG COO, succeeding Vice Chairman Kwon Young-soo, who moved to CEO of LG Energy Solution. LG Corporation plans to hold an extraordinary shareholders' meeting on January 7 next year to appoint Vice Chairman Kwon as an inside director of LG Corporation, and if appointed, the board will discuss the agenda for CEO appointment.
With Vice Chairman Kwon's promotion, the number of vice chairmen within LG has increased to four, including Cha Seok-yong of LG Household & Health Care, Kwon Young-soo of LG Energy Solution, and Shin Hak-cheol of LG Chem. LG and LG Electronics will hold extraordinary shareholders' meetings on January 7 next year to appoint inside directors. LG explained, "Vice Chairman Kwon has led LG Electronics to achieve record-high performance through selection and concentration and business restructuring as CEO, and will now strengthen future readiness for sustainable growth of LG Group as LG Corporation COO."
Vice Chairman Kwon has been a key figure leading business restructuring at LG Electronics, a core affiliate, since Chairman Koo's inauguration. Notably, he oversaw the closure of the mobile communications (MC) division, which had been considered LG Electronics' 'pain point' this year. At that time, Vice Chairman Kwon sent an email to employees stating, "The core competencies accumulated in the MC division will now focus on new future values for LG Electronics and the group." In early July, he also launched LG Magna e-Powertrain, an electric vehicle powertrain joint venture with Canadian auto parts company Magna International.
In the business community, it is expected that Vice Chairman Kwon, who has led these changes, will actively communicate with Chairman Koo and rapidly expand LG Group's core future businesses such as AI, automotive components, robotics, and big data across affiliates. Vice Chairman Kwon has experience working with Chairman Koo when he was head of the synergy team at LG Corporation in 2014, responsible for creating convergence synergies among LG Group affiliates, while Chairman Koo was the synergy team leader.
Vice Chairman Kwon is expected to focus on supporting the strengthening of core business competitiveness, enhancing LG's business portfolio sophistication and future readiness from a long-term perspective, managing the holding company, and assisting Chairman Koo. He is also anticipated to enhance execution capabilities for sustainable growth by increasing synergy among affiliates and accelerating digital innovation.
LG Electronics CEO is 'Overseas Expert' Jo Joo-wan... Most Affiliate Heads Retained
Along with Vice Chairman Kwon's move, Jo Joo-wan, Chief Strategy Officer (CSO), will take over as the new CEO of LG Electronics. President Jo is an 'overseas expert' who served as head of LG Electronics' Canada and U.S. subsidiaries. He has spent more than half of his 34-year career working overseas, gaining diverse market experience and accumulating customer insights. Over the past two years as CSO, President Jo has instilled the DNA of 'winning growth and successful change' throughout the company. He has focused on the business's potential from a macro perspective rather than short-term results, striving to build a company that is properly recognized by customers and markets.
He has also led business portfolio sophistication based on changes in work methods and digital transformation. President Jo aligns LG Electronics' digital transformation direction and goals with 'DX for CX' (Digital Transformation for Customer Experience). It is reported that he believes digital transformation provides customers with differentiated experiences and creates a lock-in effect where once customers experience LG Electronics' products and services, it is difficult to return to the previous state. Accordingly, he is expected to accelerate digital transformation after his appointment.
LG decided to retain CEOs of other core affiliates. This reflects Chairman Koo's judgment to prepare for uncertainties in the management environment caused by prolonged COVID-19 and supply chain risks, while entrusting experienced existing management to build a foundation for sustainable growth by producing results. Chairman Koo recently emphasized at workshops and business reporting sessions with affiliate CEOs that "it is important to focus more on customer value management, which has been steadily pursued, to secure business competitiveness and achieve qualitative growth."
'Young Executives' in their 40s account for 62%... Nine Female Executives Appointed
In this personnel reshuffle, Chairman Koo conducted the largest-scale promotion of 179 executives among the four reshuffles since his inauguration, and also appointed a large number of 132 new general managers, the highest level since his inauguration. Including five CEO and business division head appointments, the total personnel scale is 181. LG explained, "Based on this year's favorable performance, we boldly appointed young talents with potential and expertise," adding, "By strengthening the general manager level, we aim to nurture future business leaders and expand the CEO candidate pool from a mid- to long-term perspective."
Among the new executives, 82 are in their 40s, accounting for 62%, and the proportion of executives born in the 1970s among all executives has exceeded half, rising from 41% at the end of last year to 52% at the end of this year. The youngest executive is Shin Jeong-eun, born in 1980 and promoted to general manager at LG Electronics this year, recognized for contributing to new orders through advanced development of vehicle 5G telematics.
In addition, many talents for future readiness were appointed, and experts in quality and safety environment were also promoted. In this reshuffle, 10 executives who quickly responded to changes and demonstrated leadership were promoted, including Kwon Hyuk-jin, head of LG Electronics' LSR Research Institute, who was appointed general manager for discovering insights based on customer experience data and contributing to business. Also, Kim Byung-hoon, 50, CTO of LG Electronics, was promoted from executive director to vice president in new technology development, R&D, and engineering fields. Baek Kyung-hoon, director of LG AI Research Institute established at the end of last year, was promoted to executive director just three years after becoming general manager. Ten talents were also appointed in quality and safety environment fields.
In this year-end executive reshuffle, LG appointed nine female talents, including one female executive director promotion and eight new general manager appointments. Female executives were promoted in various roles such as strategy, marketing, R&D, and production, increasing the proportion of female executives in LG from 3.5% (29 people) at the end of 2018 to 6.2% (55 people) at the end of this year, nearly doubling. LG also recruited 28 external talents as executives, including David Kang, former Vice President of Global Marketing at Space Brand, who joined as Executive Director of LG Electronics Global Marketing Center's Online Business Division.
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