National Pension Service Halts POSCO Chairman Appointment Process, Citing "Unfairness"

Chairman Kim Taehyun: "Appointment Procedures Must Be Conducted Fairly"
Fairness Controversy Due to Structure Favoring Current President's Reappointment
POSCO Post-Management Committee: "Supporting Choi Jungwoo's Third Term Is a Personal Freedom"

The National Pension Service (NPS) has expressed the need to improve the procedures related to the selection of the next chairman of POSCO Holdings. On the 29th, Kim Tae-hyun, chairman of the NPS, stated, "The chairman appointment process must be conducted publicly based on fair and transparent standards and procedures," adding, "In light of the KT case, equal and fair opportunities without discrimination between internal and external candidates should be provided to maximize shareholder value." The NPS is the largest shareholder of POSCO Holdings, holding a 6.71% stake.

Kim Tae-hyun, Chairman of the National Pension Service, is reporting on business at the National Assembly Health and Welfare Committee's audit on the 20th. Photo by Kim Hyun-min kimhyun81@

POSCO Holdings is currently conducting the chairman selection process through the 'CEO Candidate Recommendation Committee (Candidate Committee).' By January 8 next year, they will compile a long list of 20 to 30 candidates, and by the end of January, they will narrow it down to a shortlist of five. In February next year, one final candidate will be confirmed and recommended to the board of directors. However, there is ongoing controversy over fairness because six of the seven outside directors who make up the Candidate Committee were appointed during the tenure of the current chairman, Choi Jeong-woo, and because Choi Jeong-woo may be included as a candidate even without officially declaring his intention to seek reappointment.

The NPS's stance is interpreted as a message effectively putting a brake on the current chairman Choi Jeong-woo's 'third term.' Earlier this year, when KT's board decided on the reappointment of then-CEO Koo Hyun-mo, the NPS raised concerns, stating that "the process was not conducted transparently and fairly." Ultimately, former CEO Koo Hyun-mo gave up on reappointment, and KT experienced an unprecedented five-month management vacuum before welcoming the current CEO Kim Young-seop as the new leader. KT is also majority-owned by the NPS.

The Candidate Committee directly refuted the NPS's criticism. Park Hee-jae, chairman of POSCO Holdings' Candidate Committee, said, "We plan to proceed with the next chairman selection process independently, transparently, and fairly according to the standards set forth in the new governance regulations announced on the 19th," adding, "If the current chairman applies for a third term, that is his personal freedom." He further stated, "Regardless of whether the current chairman applies, the Candidate Committee will strictly conduct the evaluation solely for the future of POSCO and the interests of shareholders."