Minority shareholders win Hankook & Company board seat

Industry

Published: 30 Mar. 2021, 19:18

Minority shareholders win Hankook & Company board seat

Cho Hyun-sik, left, vice chairman and CEO of Hankook & Company and his younger brother Cho Hyun-bum, CEO of Hankook Tire & Technology. [YONHAP]

Minority shareholders won a rare victory Tuesday when they were able to appoint a director to Hankook & Company against the wishes of the largest shareholder.

Lee Han-sang, a Korea University professor, received enough votes to be named to the board and to the audit committee. He was supported by Cho Hyun-sik, who owns 19.32 percent of the stock and is fighting for control of the company with Cho Hyun-bum, his younger brother and a 42.9 percent owner.

The director was approved despite the lack of support from the largest shareholder due to the so-called 3-percent rule, a recent amendment to the Commercial Act that stipulates that the largest shareholder and related parties are limited to only 3 percent of the vote for audit committee appointments

When the vote is for a board position and for a place on the audit committee, only a single vote is held and the 3-percent rule applies.

Cho Hee-kyung, a sister of the battling brothers, owns 0.83 percent of the company and supports Cho Hyun-sik. Cho Hee-won, another sister, owns 10.82 percent of the company and did not pick sides. The National Pension Service has about 5 percent of the company and is backing Cho Hyun-sik.

In the battle for board seats at Hankook & Company, Cho Hyun-bum supported Kim Hye-kyung, a former presidential secretary on gender and family affairs, who lost the vote for director.

Cho Hyun-bum also supported Lee Mi-ra, chief human resources officer at GE Korea, who won the vote for external director at Hankook Tire & Technology.

Cho Hyun-sik supported Lee Hye-woong, CEO of BRB Korea Advisers, who lost the vote for an external director seat at the tire company.

“I will contribute to enhancing shareholder value through qualitative and quantitative growth by renewing the governance structure,” Cho Hyun-sik, who is vice chairman and CEO of the company, said during the shareholder meeting Tuesday.

Cho Hyun-bum is the CEO of Hankook Tire & Technology, which is Korea’s largest tire maker and 30.67 percent owned of Hankook & Company.

Earlier in the day at shareholder meeting of the tire company, he was reappointed as a board member.

BY JIN EUN-SOO [jin.eunsoo@joongang.co.kr]