Shin Dong-joo Submits 'Dismissal Proposal for Director Shin Dong-bin' to Japan Lotte Holdings

Former Vice Chairman of Lotte Holdings Japan, Shin Dong-ju (left), Shin Dong-bin, Chairman of Lotte Group (right).

[Asia Economy Reporter Seungjin Lee] Shin Dong-joo, chairman of SDJ Corporation (former vice chairman of Japan Lotte Holdings), submitted a shareholder proposal on the 28th ahead of the upcoming regular shareholders' meeting of Japan Lotte Holdings scheduled for June. The proposal includes the dismissal of Shin Dong-bin from the board of directors and amendments to the articles of incorporation.

Chairman Shin Dong-joo stated in the "Notice on Submission of Shareholder Proposal for the Regular Shareholders' Meeting of Lotte Holdings Co., Ltd." that “As the largest shareholder and representative of Kwangyunsa, the largest shareholder of Lotte Holdings, I submitted the shareholder proposal to fundamentally correct the current situation where Lotte Holdings lacks corporate governance functions.”

This demand calls for the dismissal of Shin Dong-bin, chairman of Lotte Group, from his director position, holding him responsible for the significant damage to Lotte Group’s brand value, reputation, and corporate value following his guilty verdict in the October 2019 trial related to state power abuse and management corruption.

Chairman Shin Dong-joo said, “At Lotte Holdings, no one, including the party who was sentenced guilty, has taken responsibility, nor have they undertaken cause investigation or measures to prevent recurrence. Amid such circumstances, in April this year, Shin Dong-bin assumed the roles of representative director chairman of Lotte Holdings and owner of the Lotte baseball team, placing the company in an incomprehensible state from the perspectives of corporate compliance management and ethics.”

Chairman Shin Dong-joo plans to file a lawsuit demanding the dismissal of Shin Dong-bin from the board of directors with the court under Article 854 of the Japanese Companies Act if the dismissal proposal is rejected at the regular shareholders' meeting of Lotte Holdings in June. He also proposed an amendment to the articles of incorporation to establish disqualification criteria for directors to prevent the appointment of inappropriate individuals who have been sentenced guilty.

Chairman Shin Dong-joo claims that he has made numerous efforts to stabilize Lotte Group’s management, including several attempts to reconcile with Chairman Shin Dong-bin and submitting a petition to the Supreme Court on behalf of Shin Dong-bin.

An SDJ Corporation official explained, “Currently, concerns from Chairman Shin Dong-joo have increased due to the deterioration of Lotte Group’s management. This shareholder proposal appears to reflect the will to uphold the wishes of the late Honorary Chairman Shin Kyuk-ho and lead Lotte Group towards compliance management.”

In response, a Lotte Holdings official said, “Former Chairman Shin Dong-joo was dismissed due to compliance violations and has repeatedly proposed the same agenda at shareholders' meetings over the past five years but has not gained trust from shareholders and employees. Moreover, in a difficult management situation due to the COVID-19 pandemic, his intention to rather exacerbate confusion is quite regrettable.” The official added, “Executives, including the chairman, are voluntarily returning their salaries to overcome difficulties, and it is unfortunate that former Chairman Shin seems unaware of this reality.”

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