KT president named as only CEO candidate by board committee

Industry

Published: 07 Mar. 2023, 18:26

KT president named as only CEO candidate by board committee

Yun Kyoung-lim, president of Group Transformation division at KT [KT]

A KT board committee named Yun Kyoung-lim as the final and only candidate for CEO, Tuesday.

Yun is the current president of KT's Group Transformation division. Yun left KT twice since he first joined the company in 2006 and was appointed president in 2021.

Before rejoining KT in 2021, he was an executive at Hyundai Motor and CJ Hellovision.

KT held a board meeting on Tuesday to interview four CEO candidates, out of 33 initial candidates.

As the CEO candidate selection committee has selected Yun as the final candidate, he will need to get approval at the shareholder meeting slated for late March.

Incumbent CEO Ku Hyeon-mo withdrew his name from consideration on Feb. 23 following pressure from the National Pension Service (NPS), the company's largest shareholder, and politicians. Ku will end his term and step down from his post by Mar. 31.

KT reopened the CEO selection process twice so far.

The company initially selected Ku as the final candidate for the CEO post, first on Dec. 16 and again on Dec. 28, after the candidacy was reopened at Ku’s request citing “a major shareholder’s concern.”

On Dec. 28, the NPS voiced opposition to the telecom company’s decision to select Ku as the sole candidate for the post, saying that “the decision is not compliant with the basic principle that CEO candidate appointment should take place through a transparent and fair process.”

In February, KT reopened the CEO selection process for the second time, but Ku ultimately decided not to run for the second term.

KT shortlisted four final candidates on Feb. 28, and met with backlash from President Yoon Suk Yeol’s People Power Party politicians.

As four candidates including Yun all shared background from KT, PPP lawmakers issued a statement criticizing KT for selecting CEO candidates only from its own backyard “to maintain their cartel.”

Rep. Park Sung-joong, representing five PPP lawmakers of the parliamentary science and ICT committee, said last week that “there are buzzing rumors inside KT that incumbent CEO Ku withdrew from the candidacy after he was put under investigation on allegation of breach of duty, and then put forward Yun Kyoung-lim as his proxy, and Shin Soo-jung as a backup in the shortlist,” said Park.

The NPS did not further express its opinion on the CEO selection process since December.

Whether Yun will be able to be appointed as CEO remains uncertain.

While there is a possibility that NPS would cast an opposing vote against at the shareholder meeting, smaller shareholders of less than 1 percent ownership and foreign investors are likely to have a final say in the decision.

Small shareholders with less than 1 percent of KT's shares with voting rights had 57.36 percent of the stock as of December last year. Foreigners own 40 percent of the company.

Many foreign shareholders are also individuals.

NPS holds 8.32 percent and is the largest shareholder.

Hyundai Motor owns 4.69 percent and Hyundai Mobis owns 3.1 percent. Shinhan Bank holds 5.58 percent.

Small shareholders of KT established an online forum in February to take collective action.

The goal is to steer the final decision in favor of the KT board committee’s selection of the CEO candidate during the shareholder meeting.

As of Tuesday, the forum had about 400 members. The community aims to attract over 1,000 members with combined 5 million shares.

KT has 261 million shares outstanding, according to the company’s regulatory filing on Feb. 9.

KT's share price slipped 9 percent since Dec. 28 when NPS opposed KT’s CEO candidate selection, and closed at 30,800 won on Tuesday.

BY SHIN HA-NEE [shin.hanee@joongang.co.kr]