Samsung Names CFO Lee as New Chairman

Lee Sang-hoon will fill the board position amid a management reshuffle intended to ease investor concerns after a bribery scandal at Samsung.
Matthew HellerNovember 1, 2017

Samsung Electronics has named CFO Lee Sang-hoon as its new chairman in a major management reshuffle that comes three weeks after its former chief executive warned of an “unprecedented crisis” at South Korea’s biggest company.

Lee will fill the board position of the former CEO, Kwon Oh-hyun, who abruptly announced his resignation last month, saying Samsung needed “a new spirit and young leadership to better respond to challenges arising from the rapidly changing IT industry.” It is the first time Samsung has split the duties of chairman and CEO.

The company on Tuesday also named Kim Ki-nam to succeed Kwon as head of the display and semiconductor division, Kim Hyun-suk to replace Yoon Boo-keun at consumer electronics, and D.J. Koh to take the place of J.K. Shin at the helm of mobile phones.

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The three new co-CEOs and Lee are all longtime Samsung insiders. They are all in their late 50s except Lee, who is 62.

According to Reuters, the shake-up at Samsung “is designed to ease investors’ concerns about a leadership vacuum following the arrest and conviction of group scion Jay Y. Lee on bribery charges earlier this year.”

“It’s a younger generation of leaders, but the divisional structure has not fundamentally changed,” said Park Ju-gun, head of research firm CEO Score.

Mark Newman, an analyst at Sanford C. Bernstein, also doesn’t see the new executive team making major changes. “I don’t think much will change. It’s a very well-run company … and they’re just having a bit of an internal reshuffle, which seems probably quite healthy,” he told Quartz.

Samsung had three chief executives before Kwon resigned, but Yoon and Koh had stepped back from the company’s day-to-day running. Lee’s bio on the company’s website states that he previously served as head of its strategy and planning office, corporate management support team, and Strategy Team One of the corporate management office.

“The new appointees are all long-serving Samsung insiders whose elevations suggest continuity rather than any new direction at the $348 billion company,” Reuters said.