Samsung Electronics Likely to Appoint Two Outside Directors at Extraordinary General Meeting

[Image source=Yonhap News]

[Asia Economy Reporter Kim Jin-ho] Samsung Electronics is expected to hold an extraordinary general meeting of shareholders (EGM) in the second half of this year to appoint two outside directors who are currently vacant.

According to the business community on the 31st, Samsung Electronics has recently started searching for candidates for outside directors under this policy. The number of outside directors on Samsung Electronics' board has decreased from six to four since the regular shareholders' meeting in March.

Han Hwajin, newly appointed outside director, resigned last month after being nominated as the first Minister of Environment in the new government, and outside director Park Byung-guk suddenly passed away on the 17th. As a result, the composition of Samsung Electronics' board has reversed from the previous 6:5 ratio of outside directors to inside directors to the current 4:5 ratio.

Under the current Commercial Act, to prevent inside directors from dominating the board, listed companies with total assets of 2 trillion won or more are required to appoint outside directors as a majority of the total number of directors (at least three). However, if the number of outside directors falls below the majority, the company must supplement outside directors at the next shareholders' meeting, but no specific deadline is set for this.

Samsung Electronics' decision to hold an EGM before the regular shareholders' meeting in March next year is interpreted as an effort to ensure the independence of the board. The timing of the EGM is expected to be around August to September.

Meanwhile, Samsung Electronics plans to disclose the vacancies of two outside directors through the 2021 Corporate Governance Report on the same day. The Corporate Governance Report is a mandatory disclosure system introduced to enhance transparency in corporate management and strengthen market discipline. Listed companies on the Korea Exchange with total assets of 2 trillion won or more must submit it by May 31.

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