SK Networks Chairman Choi Seon-won Resigns... Likely to Focus on Trial

Choi Sun-won, Chairman of SK Networks

[Asia Economy Reporters Choi Dae-yeol and Yoo Je-hoon] Choi Sin-won, chairman of SK Networks who is on trial for breach of trust and embezzlement charges, stepped down from all his positions within the company on the 1st.

Chairman Choi is the second son of Choi Jong-geon, the founder of SK Group’s predecessor Seonkyung Textile (now SK Networks), and the cousin of SK Group Chairman Choi Tae-won. After the passing of his older brother, former SK Chemicals Chairman Choi Yoon-won, Choi Sin-won played the role of the eldest uncle within the group and spent 40 years as an SK man. With this “dishonorable resignation,” he is expected to focus on the ongoing trial.

Chairman Choi, who was detained in February this year, has been released since September after the detention period ended and is currently on trial. SK Networks stated, “Chairman Choi resigned from all positions related to the company on the 29th of last month according to his own will,” adding, “We will continue to strive for stable management and future growth centered on the board of directors and the president as we do now.” Accordingly, SK Networks changed from a dual CEO system with Choi Sin-won and Park Sang-gyu to a sole CEO system under Park Sang-gyu.

SK has had a joint management system among cousins led by Chairman Choi Tae-won since the late 1990s, following the early passing of former chairmen Choi Jong-geon and Choi Jong-hyun. The most prominent figures have been Chairman Choi Tae-won and his younger brothers Vice Chairmen Choi Jae-won and Choi Chang-won. Chairman Choi Sin-won also served as CEO of SKC starting in 2000 and as CEO of SK Networks since 2016, but has been regarded as less interested in company management compared to his younger brothers. Unlike the youngest brother, Vice Chairman Choi Chang-won, who early on prepared the separation requirements for some chemical and bio affiliates including SK Discovery, Chairman Choi Sin-won holds only minor stakes in SK Networks (0.83%) and the group holding company SK Inc. (0.04%).

Even if the ongoing trial results in a favorable outcome for him, it is expected to be difficult for him to return to management. Being over seventy years old by Korean age and with SK Group advancing its governance modernization comprehensively, the board of directors holding authority is likely to judge that it is difficult to entrust company management solely because he is a member of the owner family.

Chairman Choi Tae-won recently conducted a governance workshop with key affiliate board members, emphasizing that the board should have practical authority such as CEO evaluation and compensation. Some view this as a signal of transition to third-generation management, as his eldest son Choi Sung-hwan, head of SK Networks’ business division, has been deeply involved in company management by reorganizing the business portfolio and steadily seeking new businesses in overseas markets.

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