Out 31, 2017
Samsung unveils 3 new co-CEOs after corruption scandal
Three presidents at the technology giant have been elevated to co-CEOs in the wake of a bribery scandal.
Samsung is getting new executive leadership in the wake of a corruption scandal involving its de facto chief.
In a surprise move, the South Korean technology giant said late Monday it had promoted three presidents -- Kim Ki-nam, Kim Hyun-suk and Koh Dong-jin -- to the roles of co-CEO. They succeed the previous leaders -- Vice Chairman Kwon Oh-hyun and Presidents Yoon Boo-keun and Shin Jong-kyun -- in the company's current three co-CEO management structure. The three will serve as heads of the company's device solutions, consumer electronics and IT and mobile divisions, respectively.
The moves come amid a robust recovery for Samsung, which has been stung in recent years by an expensive and embarrassing recall of its Galaxy Note 7 and saturation of the global smartphone market. Hours before the management changes were announced, Samsung reported its biggest operating profit ever as it benefited from strong demand for its memory chips and other components.
While Samsung's benefiting from its strong components business, some market watchers say it has been too slow to adapt to new technologies like artificial intelligence and augmented reality. It also faces tougher competition from Apple in the market for premium mobile devices, as well as other upcoming Chinese vendors like Huawei.
"The next generation of leaders are well suited to accelerate the pace of innovation and address the demands of the connected world," Kwon, the outgoing vice chairman, said in a statement. "They have proven track records with extensive experience and outstanding expertise in their fields."
Changes at the top
At least one of the new CEOs is a familiar face to Samsung watchers. Koh, the new head of mobile, has effectively run day-to-day operations for that business for the past two years. He launched the Galaxy S7, which helped resuscitate Samsung's then-struggling mobile business, but also oversaw the ill-fated Galaxy Note 7.
Kim Hyun-suk, the new head of the consumer electronics business, has overseen Samsung's display business since December 2011. He started at the company in 1992 and has led the development of Samsung's flagship TV lineups for the past decade, including its LED TV, Smart TV, UHD TV, Curved TV and QLED TV series.
Kim Ki-nam has served as president of Samsung's semiconductor business since June 2014. He joined the company in 1981 and has played a key role in developing new memory technologies for DRAM and NAND flash products.
Kwon, meanwhile, has served as a co-vice chairman of Samsung Electronics with Jay Y. Lee, heir to the family that owns the giant Samsung conglomerate. Lee, who has served as de facto head of Samsung since his father's 2014 heart attack, was sentenced to five years in prison after being convicted in August of bribing South Korea's former president to help him increase his power over the company.
Kwon, who oversaw the growth of Samsung's component business which now generates much of the firm's profits, cited the scandal when he announced earlier this month he would step down from management after three decades with the company. Analysts had expected his replacement to be named quickly.
The departure of Yoon and Shin from their co-CEOs came as a surprise, though. They said in a joint statement that they decided to follow Kwon's lead to make way for new management. "We are confident that our successors will keep the company on its growth path," they said.
Yoon, in an interview last month, expressed concerns about the company's future with its chairman in a coma and its vice-chairman/de facto leader in prison. He compared Samsung to a ship without a captain. "Nobody would get on a ship without a captain because you know it's dangerous," he said. "We are on such a ship."
Samsung on Monday also announced the immediate resignation of CFO Lee Sang-hoon, who has been nominated to succeed Kwon as chairman of the board of directors. Samsung said this would be the first time the chairman and CEO roles would be separated.