Hanjin Kal Reappoints CEO Cho Won-tae... Recommends 7 Internal and External Directors

Strengthening the Professional Management System - Significant Expansion of Outside Directors

[Asia Economy Reporter Yu Je-hoon] Hanjin KAL has strengthened its professional management system and significantly expanded its outside directors ahead of the regular shareholders' meeting scheduled for the 27th. This move is to prepare for the 'battle of numbers' against the shareholder coalition aiming to normalize Hanjin Group.

On the morning of the same day, Hanjin KAL held a board meeting at its Seosomun office in Jung-gu, Seoul, where it approved the agenda for the shareholders' meeting, including proposals for new outside director nominations, reappointment and new nominations for inside directors, and dividend proposals.

The Hanjin KAL board first re-nominated Chairman Cho Won-tae of Hanjin Group (CEO), whose term expires at the end of this month, as an inside director candidate. Additionally, Vice President Ha Eun-yong of Korean Air was recommended as a new inside director candidate.

Vice President Ha is a finance and strategy expert who has worked at Hanjin Group for about 30 years. He has held positions in Korean Air’s overseas sales branches, finance headquarters, management planning office, aerospace business division, flight operations division, finance at Hanjin Co., Ltd., and auditor at Hanjin Information & Communications.

The outside director lineup was also significantly expanded. With the term of current outside director Lee Seok-woo expiring, one vacancy arose among the four current outside directors (Lee Seok-woo, Joo In-gi, Shin Sung-hwan, Joo Soon-sik). Including this vacancy, five new outside directors were appointed: Kim Seok-dong, former Chairman of the Financial Services Commission; Park Young-seok, President of the Korea Capital Market Institute; Lim Chun-soo, CEO of Midas Private Equity (PE); Choi Yoon-hee, Professor at Konkuk University Law School; and Lee Dong-myung, Chief Attorney at Law Firm Cheoeum. If all are appointed, the number of outside directors will increase from four to eight.

Industry insiders view Chairman Cho’s simultaneous reinforcement of professional management and outside directors as a move conscious of the numerical battle with the shareholder coalition. The current Hanjin KAL articles of incorporation do not set a limit on the number of directors. The shareholder coalition, composed of former Korean Air Vice President Cho Hyun-ah, private equity fund KCGI, and Bando Construction, previously proposed eight director candidates (three inside director candidates, four outside director candidates, with one candidate having withdrawn) through a shareholder proposal.

Since the shareholder coalition is attempting to form a majority on the board through a strategy of overwhelming numbers, Hanjin KAL plans to respond by recommending a similar number of director candidates. Lee Sang-heon, a researcher at Hi Investment & Securities, said, "The shareholder coalition first proposed eight board members, and since there is no strong reason to reject such a shareholder proposal, this is interpreted as a countermeasure."

Regarding professional management, inside director candidates Kim Shin-bae (former SK Vice Chairman) and Bae Kyung-tae (former Samsung Electronics Vice President) are also being considered. Since they are evaluated as having limited expertise in the airline transportation industry, the strategy is to strengthen the professional management system to dilute the shareholder coalition’s justification.

A Hanjin Group official stated, "We have recommended candidates with superior expertise and independence compared to those proposed by the shareholder coalition," adding, "We expect to further solidify the professional management system centered on Chairman Cho and to continue pursuing management development plans such as governance and financial structure improvements currently underway."

This content was produced with the assistance of AI translation services.