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LG seeks changes through executive reshuffles

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LG Electronics CEO Kwon Bong-seok, left, and LG Household & Health Care Vice Chairman and CEO Cha Suk-yong
LG Electronics CEO Kwon Bong-seok, left, and LG Household & Health Care Vice Chairman and CEO Cha Suk-yong

By Baek Byung-yeul

Management reshuffle season has arrived at Korea's major business conglomerates, with LG Group expected to be the first to announce new executive appointments this week.

Other conglomerates such as Samsung, Hyundai Motor and SK will announce their executive reshuffles before the end of the year.

LG Group has been known for choosing stability over rapid changes in its management reshuffles. But industry sources and officials familiar with the matter said Monday that the country's fourth-largest conglomerate is forecast to undergo a wide range of changes this time, as Chairman Koo Kwang-mo will strengthen his voice across the group starting with the upcoming appointments.

The chairman, who is in his 40s and marks his fourth year in office in 2022, is known to be favoring the replacement of executives born in the 1960s with younger ones, the sources said.

"Given Chairman Koo's pragmatic nature, he will consider how much expertise the new executives have instead of their age, gender and academic backgrounds," an industry official said.

To lay the groundwork for the changes, the group's affiliates such as LG Electronics, LG Display, LG Energy Solution and LG Corp. have been hiring both experienced and young journalists in charge of the firms' promotional activities, while minimizing the number of executives born in the 1960s, the source said.

The personnel reshuffle plan includes changing the head of LG Household & Health Care (LG H&H), according to the sources.

LG H&H has been headed by Vice Chairman and CEO Cha Suk-yong for 16 years. Under his leadership, the company's operating profit increased for 66 consecutive quarters until the third quarter of 2022.

He has raised LG H&H as the largest consumer goods company in Korea by pursuing various acquisitions of smaller companies and diversifying its business portfolio. However, considering that overseas cosmetics sales, which have contributed significantly to profits, are sluggish and that he is 70, there is a "strong possibility" that he will retire this year.

"It is understood that LG Group has completed its review of the leaders of its affiliates. Vice Chairman Cha has made a great contribution to LG H&H so far, but his future in the company is very unclear now." The group is expected to replace the vice chairman during this year's management reshuffle, according to one of the sources.

Meanwhile, Kwon Bong-seok, CEO of LG Group's crown jewel LG Electronics, is widely expected to become vice chairman in this year's personnel reshuffle.

"CEO Kwon is expected to be promoted to vice chairman in this year's personnel reshuffle," another industry source said.

In 2019, Kwon became the CEO of LG Electronics, succeeding then CEO and Vice Chairman Jo Seong-jin.

"LG Electronics officially withdrew from its money-losing smartphone business this year. When the company is focusing on emerging businesses such as robotics and vehicle components, Kwon is considered as a leader who can lead the fast-changing business circumstances," he said.

It also remains to be seen who will replace Kwon Young-soo, previously the vice chairman of LG Corp., the holding company of LG Group.

In October, Kwon became new vice chairman and CEO of the group's battery-making affiliate, LG Energy Solution, at a time when the battery company faced daunting tasks and numerous challenges especially regarding client-oriented issues.


Baek Byung-yeul baekby@koreatimes.co.kr


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