SKC to Significantly Expand Role of Outside Directors

[Asia Economy Reporter Choi Dae-yeol] SKC, implicated in embezzlement and breach of trust allegations against Choi Seon-won, Chairman of SK Networks, has decided to strengthen the role of outside directors.

According to SKC’s “Board Governance Improvement Plan” decided at the board meeting on the 15th, the focus is on enhancing the role and independence of the board centered on outside directors. Separate committees related to ESG (Environment, Social, Governance), internal transactions, and personnel will be newly established within the board, with all chairpersons appointed from outside directors. The existing audit committee’s functions will also be strengthened. The internal transactions committee will be composed entirely of outside directors and will be responsible for reviewing transactions between the company, controlling shareholders, and related parties.

This plan will be finalized through the regular general shareholders’ meeting and board meeting on the 30th. Along with announcing the governance charter, follow-up measures for the newly established committees will be promptly implemented. The personnel committee will not only recommend outside director candidates, as was previously done by the outside director nomination committee, but will also recommend inside director candidates and serve as a check on inside directors. It will have authority over evaluation, compensation, and recommendation of inside directors, including the CEO.

The ESG committee will pre-review the company’s mid- to long-term strategies, ESG promotion strategies, large-scale investment projects, and annual management plans. The company stated that it will review the direction of ESG management and regularly monitor implementation status to lead sustainable management. The audit committee will move beyond focusing solely on accounting audits to take on integrated risk management oversight functions. It will also perform non-financial audits such as compliance monitoring and have authority over appointing external auditors and consenting to the appointment or dismissal of internal audit officers.

Additionally, to strengthen the board’s expertise and diversity, a female outside director with expertise in environmental and legal fields will be appointed. From next year onward, the scope will be expanded to include global ESG experts. A company official said, “We will make this year the inaugural year of ESG management, strengthen governance to a global standard or higher, and firmly establish a foundation for sustainable growth.”

Choi Seon-won, who served as CEO and Chairman of the company from 2000 to 2015, was recently indicted on charges including breach of trust involving approximately 120 billion KRW. The Korea Exchange will review whether SKC qualifies for delisting suitability review.

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