Major Candidates for POSCO CEO Eliminated... Possibility of Bold Appointment Gains Weight

Pepper Committee narrows down to 6 internal and external candidates
Prominent contenders including Kim Hak-dong eliminated
Speculation on severing ties with Chairman Choi Jung-woo

Kwon Young-soo expresses determination: "With a sense of mission like Park Tae-joon, I will serve the country for just 3 years"

The POSCO Holdings CEO Candidate Recommendation Committee held its 8th meeting on the 31st and finalized the 'finalists' for the in-depth interview screening. The next chairman candidates for the POSCO Group are Kwon Young-soo, former Vice Chairman of LG Energy Solution (clockwise from the top left), Kim Dong-seop, current President of Korea National Oil Corporation, Kim Ji-yong, Head of POSCO Holdings Future Research Institute, Jeon Jung-sun, former President of POSCO Holdings, Jang In-hwa, former President of POSCO, and Woo Yoo-cheol, former Vice Chairman of Hyundai Steel.
[Image source=Yonhap News]

Kwon Young-soo, former Vice Chairman of LG Energy Solution (68), who is included among the six ‘finalists’ for the next chairman of POSCO, reportedly expressed his ambition to those around him, saying, "I think I will do it for just three years for the country." Among the six candidates, Kwon is the first to directly or indirectly reveal his motivation for applying. As many strong candidates have been eliminated, there is also an interpretation that this could lead to a ‘radical appointment.’

A representative from Kwon Young-soo’s side told Asia Economy on the 1st, "Kwon is approaching the POSCO chairman selection process with the thought of using his capabilities for the country, especially for POSCO, a company with significant influence and importance in the industry," adding, "He has the sense of mission like the late Chairman Park Tae-joon and wants to dedicate exactly three years with his final passion."

He continued, "(Kwon) has no personal interests but does have ambitions as a manager," adding, "He is fully exposed to issues such as supply chains, ESG (environment, social, governance), and the US-China conflict, and wants to try to solve these problems as a manager."

Kwon is known to have evaluated that the POSCO Group is currently at an important turning point. The representative said, "POSCO has done well in the steel industry so far, but in the carbon-neutral era, it needs to envision the future of steel and shift direction to optimize steel technology," adding, "He plans to embrace existing personnel and use the achievements POSCO has made so far to serve the country."

Kwon’s side viewed the POSCO CEO Candidate Recommendation Committee’s (CRC) decision on the finalists as maintaining independence and neutrality. He said, "They maintained an appropriate balance with three internal and three external candidates, and the exclusion of OBs (old boys) frequently mentioned in the media is rather a sign that the CRC made an independent decision."

However, regarding the fact that most candidates recommended are from the steel industry, he emphasized Kwon’s competitiveness as the next chairman candidate, saying, "(Most candidates) understand the existing steel industry and have worked there for a long time, but Kwon is uniquely the only one who has managed the group comprehensively, including batteries and new materials."

Along with Kwon Young-soo, Kim Dong-seop, President of Korea National Oil Corporation (68), Kim Ji-yong, President of POSCO Holdings Future Research Institute (63), Woo Yoo-cheol, former Vice Chairman of Hyundai Steel (68), Jang In-hwa, former President of POSCO (70), and Jeon Jung-seon, former President of POSCO Holdings (63), have entered the race for the next POSCO Group chairman, anticipating fierce competition among candidates. With many POSCO insiders who were considered strong candidates eliminated and candidates from LG, SK, and Hyundai Motor Group included, the possibility of an ‘external’ chairman emerging for the first time in 30 years has increased.

The CRC held its 8th meeting on the 31st of last month, confirming the six ‘finalists’ and publicly releasing the list for the first time. The CRC explained that the selection process focused on "expertise and leadership capabilities for future leap and change."

The CRC added, "Entering the global carbon-zero era has become a critical issue that will determine the future of the steel industry, and the advent of the eco-friendly future materials era is both a new business opportunity and a huge challenge that requires new strategies, investments, and technical preparations to overcome competition," adding, "It is now time to thoroughly re-examine various issues accumulated during the rapid business advancement process and prepare for the future."

As a result, a competition between three ‘POSCO men’ and three external figures has emerged. Many former and current POSCO executives who had been mentioned as strong contenders within and outside the POSCO Group, such as Kim Hak-dong, Vice Chairman of POSCO, Jung Tak, Vice Chairman of POSCO International, and Hwang Eun-yeon, former head of POSCO Human Resources Innovation Institute, were largely eliminated from the final candidate pool. This has led to interpretations that this might lead to a ‘radical appointment.’ It is believed that this reflects awareness of criticism that if a current executive becomes chairman, it would be an ‘extension’ of the current Chairman Choi Jeong-woo’s regime.

Former Presidents Jang and Jeon, who were additionally reported to the prosecution on the 17th over allegations of a ‘luxurious overseas board of directors,’ were included among the finalists. Since the CRC, which was also reported on the same charges, has emphasized that it is unrelated to the allegations, this decision is interpreted as not being significantly influenced by ‘judicial risks’ going forward.

Among current executives, Kim, the head of the Future Research Institute, is the only one named. A Seoul National University metallurgy graduate and currently the group’s Chief Technology Officer (CTO), Kim was promoted at the end of last year. His recent appointment as president defied expectations that his chances of being selected as a candidate were low.

It is also unusual that three external candidates who have never worked at POSCO were included. Along with Kwon Young-soo, Kim Dong-seop has never worked in the steel industry. Kim, who worked for 20 years at the global oil company Shell and served as head of SK Innovation’s Technology Institute, is an expert in global perspectives and the oil and resource sectors. Former Vice Chairman Woo graduated from Seoul National University’s Naval Architecture and Ocean Engineering department, worked at Hyundai Heavy Industries and Hyundai Rotem, and then moved to Hyundai Steel, where he oversaw research and development (R&D).