KT&G Shareholder Urges Management Reform in Open Letter

Business by 2FIRSTS.ai

Dec.07.2023

KT&G Shareholder Urges Management Reform in Open Letter

KT&G shareholder Flashlight Capital Partners opposes reelection of current CEO Paek Bok-in and demands management reform.

According to a report by South Korean news source Naver on December 7th, KT&G's shareholder Flashlight Capital Partners (FCP) has sent an open letter to the company's board of directors strongly opposing the reappointment of current President Paek Bok-in and demanding reforms in the selection process for senior management personnel.

According to FCP, a company represented by Lee Sang-hyun, since Bai Furen took over as president of KT&G in 2015, although the company's sales have been increasing over the past nine years, its operating profit has consistently declined. Moreover, the company's stock price has continuously decreased during this period and its financial situation is significantly different compared to its industry competitors.

According to financial news reports, despite President Bai Furen's responsibility for the sales growth of KT&G, FCP Company has accused him of consistently underperforming due to the gap in operating profit margins compared to the industry and the continuous decline in stock prices. As a result, FCP opposes his re-election and proposes a new selection principle for the president that is fair, just, and transparent.

Lee Sang-hyun believes that the CEO candidate for KT&G should be open to external candidates, and the board of directors should actively seek and recruit professional managers from the global fast-moving consumer goods (FMCG) industry.

References:

[1] [fn마켓워치]FCP, 백복인 KT&G 사장 연임 반대 압박

Also Read:

[1] KT&G Donates 10 million won to Gwangju City Government for Winter Assistance

[2] KT&G Announces 2.8 Trillion KRW Shareholder Rebate Plan

[3] KT&G Reports Record Q3 Financial Performance in 2023

[4] KT&G Strengthens Shareholder Returns with Higher Stock Price

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