Shin Dong-joo Submits Agenda for Appointment as Inside Director of Lotte Holdings... "Proposal to Dismiss Shin Dong-bin"

Shin Dong-ju, Chairman of SDJ Corporation.

[Asia Economy Reporter Lim Chun-han] Shin Dong-joo, chairman of SDJ Corporation, has once again submitted a shareholder proposal and preliminary inquiry ahead of the Lotte Holdings regular shareholders' meeting scheduled for the 29th, which includes his own appointment as director, the dismissal of Shin Dong-bin as director of Lotte Holdings, and amendments to the articles of incorporation.

On the 24th, Chairman Shin Dong-joo stated through the "Notice of Submission of Shareholder Proposal and Preliminary Questions 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 have submitted shareholder proposals and preliminary questions to fundamentally correct the current situation where Lotte Holdings lacks corporate governance functions."

Chairman Shin Dong-joo pointed out, "Since Shin Dong-bin took office as CEO of Lotte Holdings, the company has continued to experience poor performance, including a decline in sales that began before COVID-19 and huge losses, resulting in the largest deficit in its history last year. It is difficult to give a favorable evaluation of his managerial capabilities. While large-scale restructuring such as workforce reductions is taking place in Korean subsidiaries, Shin Dong-bin is not taking responsibility for the poor performance and is receiving large compensation from subsidiaries in the form of dividends and executive remuneration."

The shareholder proposal also includes an amendment to the articles of incorporation to establish disqualification criteria for directors to prevent the appointment of inappropriate individuals who have been convicted. Chairman Shin Dong-joo also delivered a preliminary inquiry to Lotte Holdings regarding responsibility for the damage to corporate value due to the decrease in market capitalization and requested that Shin Dong-bin respond directly at the regular shareholders' meeting.

Meanwhile, since 2016, Shin Dong-joo has submitted proposals to the Lotte Holdings shareholders' meetings a total of seven times, including his own return to management or the dismissal of Chairman Shin Dong-bin, but all were rejected.

The Lotte side responded to Shin Dong-joo's moves by saying that there is ‘no need to respond’. A Lotte official emphasized, "Former Vice Chairman Shin Dong-joo was dismissed for violating compliance management and previously attempted to return seven times at shareholders' meetings but was rejected due to lack of trust from shareholders and employees. The court also recognized his compliance management issues and lack of ethics and ruled that he must compensate the company."

Meanwhile, in May, Shin Dong-joo lost a damages lawsuit filed by Lotte Service, a subsidiary of Japan's Lotte Holdings. The Tokyo District Court ruled that there were unreasonable aspects in the business judgment process regarding the so-called 'Pullica' business conducted while Shin Dong-joo was CEO of Lotte Service, ordering him to compensate the company approximately 480 million yen (about 470 million KRW).

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