KT Appoints Seven New Outside Directors... Full-Scale Start of Corporate Governance Restructuring

KT officially embarked on a new governance restructuring by completing the appointment of seven new outside directors on the 30th. The company plans to start the next CEO appointment process next month, finalize one candidate, and officially appoint the next CEO in August.

On the same day, KT held the 2023 first extraordinary general meeting of shareholders at its R&D Center in Umyeon-dong, Seoul, where it approved the appointment of new directors and partial amendments to the articles of incorporation.

The newly appointed outside directors are ▲ Kwak Woo-young, former head of Hyundai Motor Company’s Vehicle IT Development Center ▲ Kim Sung-chul, professor at Korea University’s Department of Media Studies ▲ Ahn Young-gyun, director of the International Federation of Accountants (IFAC) ▲ Yoon Jong-soo, former Vice Minister of Environment ▲ Lee Seung-hoon, representative partner of KCGI’s Global Division ▲ Cho Seung-ah, professor at Seoul National University’s College of Business Administration ▲ Choi Yang-hee, president of Hallym University, totaling seven members.

Based on the revised articles of incorporation, these outside directors will begin the CEO candidate recommendation process starting next month. KT changed the qualification criteria for CEO candidates in the articles to four categories: ▲ corporate management expertise ▲ leadership ▲ communication skills ▲ industry expertise. The previous requirement for specialized knowledge and experience in ICT was removed.

For this CEO appointment process only, KT decided to form the pool of outside CEO candidates not only through recommendations from external professional organizations and open recruitment but also via shareholder nominations. Shareholder nominations are allowed only for shareholders who have held at least 0.5% of KT shares for more than six months.

When forming the CEO candidate pool, KT will consider the existing requirements (at least two years of service and a group rank of vice president or higher) along with management expertise and understanding of KT’s business. An appointment advisory panel will be utilized for the composition and evaluation of both internal and external CEO candidates.

Park Jong-wook, Acting CEO and Head of the Management Planning Division (President) at KT, said, "We have established comprehensive governance improvement measures, including the CEO appointment process and the roles of directors. Through this opportunity, we will do our best to build a trusted governance structure that goes beyond global standards."

At the shareholders’ meeting, there were also demands that outside directors should play a role in preventing parachute appointments of CEOs. A representative of KT’s new labor union stated, "There is much suspicion that the amendment of the articles of incorporation is a preparatory step for parachuting a CEO. President Park must clarify this precisely." Regarding the appointed outside directors, he added, "Becoming an outside director of KT means committing to work for KT’s future. The starting point is to accurately check the vested interest cartel that caused this management vacuum. They must declare opposition to the vested interest cartel here."

In response, President Park said, "The CEO appointment process has been improved to strengthen resolution requirements so that it can gain the approval of the majority of shareholders. Please understand that such processes have been established." He added, "The newly appointed directors are not in a position to speak immediately. There will be an opportunity at the second extraordinary general meeting."

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