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SK’s Successful Defense of Management Rights

Posted March. 12, 2004 23:38,   


General meetings of stockholders at 93 KOSDAQ-listed companies, including SK Corp., Hyundai Motors, POSCO, LG Electronics, and 29 other companies registered in KOSDAQ, were held on March 12.

SK Corp. successfully defended their management rights against Sovereign Asset Management Limited with a landslide victory in the voting in the general meeting held at Sheraton Walkerhill Seoul.

The executive candidates-- Cho Soon, Oh seh-jong, Kim Tae-yoo, Seo Yun-seok, and Shin Huhn-cheol—recommended by SK were all selected as the executives while all the candidates supported by the Sovereign Asset Management Limited were left out in the voting. Nahm Dae-woo, who was nominated by both parties, was appointed as a company-external executive & inspection commissioner.

The bill suggested by SK Corp. to modify the articles of association with plans including extending the percentage of company-external executives to 70 percent, organizing a Clean Management Committee, and organizing an Inspection Committee mainly composed of company-external executives was rejected, failing to receive two-thirds of the present stockholders votes. A concentrative voting plan suggested by Sovereign Asset Management Limited was also rejected.

None of the corporate management-restructuring plans was passed, and SK had to be pleased with this “half” victory.

The meeting hall was surrounded by more than 500 security guards placed by the company that day. The guards checked the personal information of every person who entered the meeting hall. However, the stockholder meeting was held amidst a quiet atmosphere unlike last year’s full of protests and yelling. There were discussions regarding points of agreement and discord and the voting processes of various bills.

SK and Sovereign held votes regarding modifications in the articles of association and the appointment of executives. The meeting lasted from 9 a.m. until 4 p.m.

POSCO’s general stockholders’ meeting finished in 53 minutes, with all the bills successfully passed. President of Eagon Industrial Co., Ltd Park Gun-young, Permanent Executive of the Beautiful Fund Park Won-sun, Honarary President of American Chamber of Commerce in Korea Jeffrey Jones, and Ewha Women’s University’s Graduate School of Management Dean Seo Yoon-suk were appointed as company-external executives.

Additionally, the meeting passed the concentrative voting and the letter voting system, which strengthens the rights of small stockholders.

SK Telecom’s general stockholder meeting was over in 25 minutes.

The meeting confirmed the resignation of SK Corp. President Choi Tae-won and SK President Sohn Kil-seung from the executive board as well as allocating 5,500 won per stock with the company’s best business showings ever.

KT’s general stockholder meeting received a recommendation of a company-external executive from the labor union. However, the union did not confirm their nomination, and the candidate suggested by the company won a landslide victory in the voting.

KT decreased the number of executives from 15 to 12, adjusting the company-external to company executive ratio to 4 to 8. It also adopted the dual status of executives.

Hyundai Motors appointed Jeon Chun-soo, CEO of Ulsan factory, as a new executive. Vice President Kim Dong-jin and Daimler & Chrysler CEO Rudiger Grube and Honorary Professor at Korea University Kim Dong-ki were re-elected. Hyundai Mobis President Park Jung-in resigned from the position with two years left before the ending of his term.

LG Electronics newly appointed Jin Nyeom, former vice prime minister and minister of Finance and Economy, Kim Il-sup, professor at Ewha Women’s University, and Hong Seong-won, president of G Mobil as company-external executives.

6. “Deep Division of Korean Society” Televised Live by CNN

Legislators dishing blows to each other; Legislators slumping down on the floor and weeping; Legislators throwing nameplates and shoes at the speaker who declared the passage of the impeachment motion.

This is the portrait of Korean politics which aired live for about an hour throughout the world by CNN on March 12.

CNN carried a live broadcast relayed through YTN from the time before the National Assembly voted to impeach President Roh Moo-hyun.

CNN evaluated that there is still a maximum of six months remaining before the final decision of the Constitutional Court is made, but Korean society has already plunged into deep division.

CNN reported on the humorous scene of the members of Nosamo (People who love Roh Moo-hyun) demonstrating outside the Capital while the parliamentary members dealing blows to each other inside the Assembly.

Responses from Leading Foreign News Agencies—

Major world news agencies began to send emergency telegrams from the moment when the National Assembly’s security guards pulled the members of the Open Uri Party out of the chamber.

The Associated Press (AP) introduced the process of treating an impeachment motion in detail and compared the contrasting responses between the supporters of the Uri Party opposing the approval of the impeachment bill and the supporters of the Grand National Party dancing and applauding, saying “Today is a national holiday.”

AP reported that, as a result of the approval of the impeachment bill, Prime Minister Goh Kun will take over the president’s duty as acting president until the Constitutional Court makes a final decision. But AP showed concern, saying that not only was it passed about a month before the general election, but also at a time of tension lingering with the North Korea’s nuclear programs, and with the South Korean economy’s road to recovery.

AP told that the approval of the impeachment bill shook the Korean financial market and brought about a sharp decline in stock prices.

Chinese government-controlled Xinhua news agency and CCTV reported the news moment-by-moment after the impeachment bill was put to a vote at 11: 34 a.m.

Foreign news agencies as a whole showed concern that Korean politics didn’t break from the old conventional one.

William Peseck Jr., a columnist from Bloomberg news agency in the U.S., pointed out in the column entitled “Economy Rather than Impeachment” that it is strange that Korean parliamentary members voted to impeach President Roh at a time when Korea strives to enhance its international image and that it is also strange that President Roh did not make a simple apology. Kyoto News, in a news commentary, said that the absence of a president in Korea might lead to confusion in national administration and predicted that it might have a great influence on both foreign and domestic policies.