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Samsung board chair open to outside directors

Former finance minister joins boardroom as new outside director

Shareholders of Samsung Electronics opened a door to outside directors as board chair Friday for the first time in the firm’s history, fueling speculation whether vice chairman Kwon Oh-hyun will continue to lead the board.

Market watchers said the move is aimed at strengthening the role and responsibility of the board for management decisions.

Kwon Oh-hyun, vice chairman of Samsung Electronics, presides over the 47th annual general meeting of the company in Seoul on Friday. (Samsung Electronics)
Kwon Oh-hyun, vice chairman of Samsung Electronics, presides over the 47th annual general meeting of the company in Seoul on Friday. (Samsung Electronics)

At the annual general meeting, despite opposition from some shareholders, the company named former Minister of Strategy and Finance Bahk Jae-wan as a new outside director.

Shareholders also approved the term extension of two current outside directors -- Song Kwang-soo, a former chief of the nation’s prosecutors’ office, and Lee In-ho, a former Shinhan Financial Group CEO.

The decision on hiking dividend payments was another highlight of the firm’s 47th AGM.

“Samsung decided (earlier last year) to raise dividend payouts by around 30 to 50 percent and it has also kept repurchasing its own shares,” vice chairman Kwon said.

The tech giant has been buying back more than 4 trillion won ($3.3 billion) worth of both ordinary and preferred stocks, which in result enhanced the value of the existing shares.

At the meeting, the company received approval for several agendas, including handing out cash dividends of 20,000 won for a common share and 20,050 won for a preferred stock, up from 19,500 won and 19,550 won, respectively, given to the Samsung shareholders in early 2015.

The business plans presented by division chiefs also drew keen attention from the shareholders.

The nation’s top conglomerate has vowed to become a first mover through investment in research and development for new technology, shedding a humiliating copycat image which has nagged the Korean behemoth for years.

“Despite the unfavorable business environment due to increasing uncertainties in the global economy last year, Samsung maintained its lead in the global electronics sector,” said Kwon.

He also added that the tech firm would actively try to seek merger and acquisition deals to dive into a new sector, which is in line with its efforts to find new growth momentum other than its flagship mobile and electronics businesses.

The electronics giant logged 201 trillion won in sales last year, and the firm’s net profit came at 19 trillion won.

By Seo Ji-yeon, Kim Young-won (jyseo@heraldcorp.com)
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