CXO Research Institute Survey... Samsung and Lotte Lead with 12 Members Each
Han Jong-hee, Vice Chairman and Head of the Device Experience (DX) Division at Samsung Electronics, speaking at a press briefing for domestic reporters ahead of the opening of 'IFA 2022,' Europe's largest home appliance exhibition, held in Berlin, Germany, on September 1 (local time). (Photo by Yonhap News)
[Asia Economy Reporter Moon Chaeseok] Among domestic companies with sales exceeding 1 trillion won, more than 200 CXO-level internal directors?including CEOs (Chief Executive Officers), COOs (Chief Operating Officers), and CFOs (Chief Financial Officers)?are set to have their terms expire before the end of June next year. Out of 669 internal directors from the so-called '1 Trillion Club' of 230 companies, about one in three will face a crossroads of promotion or retirement in the first half of next year. Samsung and Lotte each have the highest number with 12, including Han Jong-hee, Vice Chairman of Samsung Electronics and head of the Device Experience (DX) division, whose term expires on March 17 next year.
On the 10th, Korea CXO Institute, a corporate analysis specialist organization, announced the results of the '1 Trillion Club CXO-level Internal Directors Status Survey.' The survey analyzed the semi-annual reports of 230 companies with sales exceeding 1 trillion won based on separate financial statements from last year. Outside directors and non-executive or other non-standing directors were excluded.
Among the 669 internal directors of the '1 Trillion Club' companies, 215 (32.1%) are understood to have terms ending in the first half of next year. Most of these terms end during the regular shareholders' meeting season in March next year. Approximately three out of ten internal directors at the CXO level are soon to face decisions regarding reappointment, promotion, transfer, or retirement.
Notably, Samsung and Lotte Group affiliates each have the highest number of such internal directors at 12. For example, Vice Chairman Han's registered executive term expires on March 17 next year. The CXO Institute stated, "Han's future will likely be decided at the Samsung Electronics board meeting scheduled as early as the end of this month," adding, "Since Han was newly appointed as CEO of Samsung Electronics in February, it is expected that he will likely be reappointed to maintain management continuity."
Among Samsung Group's presidents and above, those whose terms expire in March next year include ▲Lee Boo-jin, President of Hotel Shilla ▲Jeon Young-hyun, Vice Chairman of Samsung SDI ▲Jeon Young-mook, President of Samsung Life Insurance ▲Kim Dae-hwan, President of Samsung Card ▲John Rim, President of Samsung Biologics. Among vice presidents serving as internal directors are ▲Sa Jae-hoon, Vice President of Samsung Securities ▲Choi Jae-hoon, Vice President of Samsung Engineering ▲Ahn Jung-tae, Vice President of Samsung SDS ▲Ahn Ki-hong, Vice President of Samsung Card ▲Jung Hong-gu, Vice President of Cheil Worldwide. Among board chairpersons, Kim Tae-han, President of Samsung Bio, will also see his term expire on March 20 next year. Born in 1957, there is speculation that Kim might step down from his registered executive position.
At Lotte Group, three internal directors each at Lotte Chemical and Lotte Hi-Mart are approaching term expiration. At Lotte Chemical, Chairman Shin Dong-bin of Lotte Group, Vice Chairman Kim Gyo-hyun, and CEO Hwang Jin-gu are set to officially end their terms on March 23 next year. Among them, Vice Chairman Kim, who will be 67 next year, is attracting attention regarding reappointment. At Lotte Hi-Mart, CEO Hwang Young-geun, along with internal directors Managing Directors Maeng Jung-oh and Ha Young-soo, have official terms ending on March 19 next year. At Lotte Chilsung Beverage, CEO Park Yoon-gi and Head of Finance Song Hyo-jin will see their terms end on March 23 next year.
Hyundai Motor Group follows Samsung and Lotte with five internal directors. Notably, Chung Eui-sun, Chairman of Hyundai Motor Group who also serves as CEO of Hyundai Mobis, is included. Chairman Chung's registered executive term at Hyundai Mobis expires on March 17 next year. Others whose registered executive terms end in March next year include ▲Seo Kang-hyun, Vice President of Hyundai Motor ▲Joo Woo-jung, Vice President of Kia ▲Park Jong-sung, Vice President of Hyundai Steel ▲Lee Yong-bae, President of Hyundai Rotem.
In the POSCO Group, which does not have a single controlling shareholder, five registered executives face reappointment decisions. Particularly, at POSCO Holdings, the board's attention is focused on whether three registered executives?including President Jeon Joong-sun, Vice President Jung Chang-hwa, and Vice President Yoo Byung-ok?will remain on the board. At POSCO Steelion, attention is on whether President Yoon Yang-soo and Executive Director Shin Gun-chul will continue on the board after the first half of next year.
At SK Group, the terms of ▲Kim Cheol, President of SK Chemicals, and ▲Park Sang-gyu, President of SK Networks, end in March next year. At LG Group, the terms of two executives?Jung Ho-young, CEO of LG Display, and Kim Chang-tae, CFO of LG Innotek?also end in March next year. The term expiration dates for President Woo Ki-hong and Vice President Lee Soo-geun of Korean Air, as well as President No Sam-seok of Hanjin, are also approaching.
Among the 215 internal directors whose terms end before the first half of next year, 22 hold the title of chairman. Notable examples include ▲Huh Chang-soo, Chairman of GS Engineering & Construction ▲Koo Ja-yong, Chairman of E1 ▲Chung Mong-won, Chairman of HL Mando ▲Lee Eo-ryong, Chairman of Daishin Securities ▲Koo Ja-kyun, Chairman of LS ELECTRIC ▲Choi Chang-geun, Chairman of Korea Zinc ▲Ham Young-jun, Chairman of Ottogi, all of whom have terms ending in March next year. Kim Hong-guk, Chairman of Harim Group, is awaiting reappointment decisions as an internal director at Harim, Sunchon, and Farmsco. Among professional management chairmen, Choi Hyun-man, Chairman of Mirae Asset Securities, will see his term end at the end of March next year.
The average age of the 215 internal directors whose terms end by the first half of next year is 59.5 years. The largest group, with 24 members, was born in 1964. Owner-managers born that year include Chung Mong-ryeol, Chairman of KCC Construction, and Yoon Seok-min, Chairman of Taeyoung Construction. Among professional managers are Koo Hyun-mo, President of KT; Huh Sang-hee, Vice Chairman of Dongbu Construction; and Park Hong-jin, President of Hyundai Green Food.
The oldest among the survey subjects is Kang Byung-joong, Chairman of Nexen Group (born 1939), and the youngest is Seo Jun-seok (born 1987), second son of Seo Jung-jin, Honorary Chairman of Celltrion, who serves as board chairman. Chairman Kang's term as an internal director of Nexen Tire ends on March 23 next year, while Chairman Seo's term at Celltrion Healthcare ends on March 26 next year.
The CXO Institute also noted that although Samsung Electronics Chairman Lee Jae-yong recently assumed the chairman position, he is still an unregistered executive, drawing business circles' attention to whether he will return to the board.
Oh Il-seon, Director of Korea CXO Institute, explained, "Typically, the reappointment or retirement of CEO-level internal directors whose terms are about to expire influences the scope of subsequent general executive personnel changes," adding, "The reappointment of registered executives is decided by the board after comprehensively considering this year's business performance, age, organizational management, and future vision, and is ultimately determined by shareholders' votes at the subsequent shareholders' meeting."
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