"Strengthening Trust, Competitiveness, and Expertise"… Bang Gyeongman-ho's Management Strategy 'T·O·P' (Comprehensive)

KT&G Appoints New Inside Director at Regular Shareholders' Meeting
Leadership Change After 9 Years
"Leap to Global Top Tier Based on 3 Core Businesses"
Challenges Include Organizational Stabilization and Profit Improvement

"Trust, Fundamental Competitiveness, and Strengthening Expertise."

Appointed as the new head of KT&G after nine years, President Bang Kyung-man presented the inaugural message for the company's continuous growth as 'T·O·P.' T·O·P is an acronym derived from the English words Trust, Origin (fundamental) competitiveness, and Professionalism. It is a management strategy aimed at enhancing stakeholders' trust through active communication, securing fundamental competitiveness as a 'first mover,' and strengthening global expertise for performance and growth.

Bang Kyung-man, New President of KT&G
[Photo by KT&G]

On the morning of the 28th, after being appointed as the new CEO at the 37th KT&G Annual General Meeting held at the KT&G Headquarters Talent Development Center in Daedeok-gu, Daejeon, President Bang expressed his ambition, stating, "KT&G will leverage its three core businesses?global cigarettes (CC), electronic cigarettes (NGP), and health functional foods?as a growth foundation to leap into a 'global top-tier' company."

At the general meeting, he secured 84,097,688 votes, ranking first overall and confirming his appointment as an inside director through a cumulative voting system that elected the top two candidates among three, including two outside director candidates. During the election process, negative public opinion was considerable, with activist funds such as Flashlight Capital Partners (FCP), holding less than 1% of KT&G shares, and presumed internal members launching attacks against the former and current management. However, when the vote took place, support for President Bang's leadership was significantly higher. Following President Bang, Son Dong-hwan, a candidate recommended by IBK Industrial Bank?the largest single shareholder holding 7.11% of KT&G shares and a professor at Sungkyunkwan University Law School?secured second place with 56,603,958 votes and joined as a new outside director.

KT&G has appointed a new president for the first time in nine years since the inauguration of former President Baek Bok-in in 2015. Former President Baek left the title of the longest-serving CEO through three consecutive terms and passed the baton. Since the company's privatization in 2002, a record has continued of insiders rising to the top, from former President Kwak Joo-young to the current President Bang.

Bang Kyung-man, the new CEO and President of KT&G (second from the right), is attending the regular shareholders' meeting held on the 28th and listening to the agenda.
[Photo by KT&G]

Newly appointed President Bang graduated from the Department of Economics at Hankuk University of Foreign Studies and earned a master's degree in business administration from the University of New Hampshire in the United States. He joined KT&G's predecessor, Korea Tobacco & Ginseng Corporation, through open recruitment in 1998 and has held key positions across the company, including Brand Director, Head of Global Division, Head of Strategic Planning Division, and Business Division Head. The ultra-slim cigarette 'Esse Change,' launched during his tenure as Brand Director, has grown to become the number one brand in the domestic market. While serving as Head of the Global Division, he built a customized brand portfolio for each overseas market, expanding the number of countries entered from about 40 to over 100. The company also explained that after being appointed as an inside director three years ago, he contributed to approximately 20% growth in operating profit across the three core businesses.

President Bang faces the challenge of stabilizing the organization while improving profitability. KT&G's consolidated sales last year reached 5.8626 trillion KRW, a slight increase from the previous year's 5.8514 trillion KRW, setting a new record. However, operating profit during the same period decreased by about 8% to 1.1673 trillion KRW. The company's operating profit has been declining for four consecutive years since 2020.

President Bang urged the members, saying, "We will enhance the company's value and build stronger trust with various stakeholders, including shareholders. Based on KT&G's successful history of overcoming numerous crises and growing, let us create a new legend through fresh and bold attempts."

Meanwhile, at the general meeting, the appointment of outside director Kwak Sang-wook as a member of the Audit Committee, approval of the director remuneration limit, and partial amendments to the articles of incorporation, including the addition of business purposes, were approved as proposed. KT&G stated, "We will make greater efforts to enhance the company's growth and shareholder value, centered on the newly formed next board of directors."