POSCO chairman to decide on whether to seek third term

POSCO Group Chairman Choi Jeong-woo [Photo by MK DB]

POSCO Holdings Inc. is on the cusp of implementing a year-end overhaul of rules governing its chief executive officer (CEO) and other executive appointments, while POSCO Group Chairman Choi Jeong-woo is expected to announce this week whether he will seek his third term. Even if Choi opts to step down, he would be the first POSCO chairman to complete a full term.

Sources familiar with the matter said Thursday that POSCO Holdings plans to convene a board meeting on December 19 to revise CEO appointment rules. The proposed changes target the current screening system that gives incumbent chief executives preferential treatment during the screening process. Choi, whose term is set to end in March 2024, will decide whether he will serve consecutive terms following the rule change.

In what critics say are biased rules in favor of sitting officials, incumbents had the option of a screening process where they were the sole candidate. In response to the criticism, POSCO Group created a task force team in March 2023 to revise regulations and establish a transparent governance structure.

Choi is expected to announce his next move following the overhaul of the preferential screening system. If he declares his intention to step down, the company will hand over decision-making responsibilities to a council responsible for CEO appointment and recommendation. As a group of independent directors, this council will prepare a list of candidates to consider and present a final candidate for shareholders’ approval in the upcoming annual shareholders’ meeting.

With the next meeting scheduled for mid-to-late March 2024, Choi must announce his decision within 90 days.

The sources said that his relationship with the Yoon Suk Yeol administration was one of the key factors influencing his decision. Despite heading South Korea’s fifth-largest company, Choi was not part of the president’s economic delegation on overseas trips, indicating a less-than smooth relationship with the government.