Can POSCO chairman renew his term?

By Jhoo Dong-chan

POSCO Chairman and CEO Kwon Oh-joon’s bid to serve another three-year term is drawing keen attention amid his alleged involvement with the Choi Soon-sil scandal that is overthrowing the Park Geun-hye administration.

Kwon said Friday that he plans to serve another term, claiming the nation’s largest steelmaker has shown positive performances over the past three years and should stay the course.

However, his alleged involvement in the Choi Soon-sil scandal as well as a controversy over the unfair interview process to POSCO’s top job could be obstacles to Kwon’s ambitions for another term, critics said.

During the board meeting Friday, Kwon revealed his plan to serve another term for POSCO.

“There are still many things to be done to complete the streamlining process and gain new growth momentum. POSCO has gained a half success over the last three years since I came into the post. In order to complete the remaining half, I intend to serve another three years as POSCO CEO,” Kwon said, adding there would be no appropriate successor to replace him for now.

POSCO indeed raised 7 trillion won ($5.9 billion) in the company’s cash liquidity through a massive restructuring process that includes selling non-core assets and saving costs over the past three years, amid the slowdown in the global steel industry.

The steelmaker also surpassed 1 trillion won in quarterly profit for the first time during his term.

Critics said his announcement for another term is to spearhead overcoming the controversy over his alleged involvement in the Choi Soon-sil scandal that led to President Park Geun-hye’s impeachment last Friday.

The prosecution said last month that Cheong Wa Dae and Choi forced Kwon to establish the POSCO fencing team.

Kwon was also embroiled in another suspicion that he was appointed to the top job through unfair procedures.

In the final interview to appoint the eighth CEO of the nation's largest steelmaker, Kwon and his competitor Jung Dong-hwa were allegedly given an unprecedented English interview session, an advantageous condition for Kwon who earned his master's and doctoral degree in North America.

It was the first time for POSCO CEO candidates to be interviewed in English, and Jung spent his entire education and career in Korea, failing to prepare the interview properly.

POSCO’s regulation suggests that the company CEO should inform the board members about his intention whether to stay or leave his post three months prior to the termination of the contract. Kwon took the post on Mar. 14, 2014.

The steelmaker’s CEO Candidate Recommendation Committee will determine Kwon’s reappointment by early next year.

Former CEO Chung Jun-yang served the post, but had to step down after 10 months when President Park Geun-hye came to power.