It has been revealed that nine out of the top 10 major corporations have seen unanimous approval from external directors on board resolutions.
Corporate data research institute CEO Score announced on March 13 that out of the 181 companies listed among the top 500 domestic companies by revenue, which submitted reports for shareholder meetings by March 8, 163 companies had a 100 percent approval rate for board resolutions by external directors. This represents 90.1 percent of the total, according to the analysis of their data.
This figure marks a 2.3 percentage point increase from the previous year, 2022, which had 159 companies accounting for 87.8 percent of the total. This trend is more pronounced in companies with a CEO. Out of 164 companies with a CEO, 150 had external directors who unanimously supported board resolutions, accounting for 91.5 percent of the total. Among the 17 companies without a CEO, 13 showed a 100 percent approval rate, which is 76.5 percent. Companies such as Samsung Electronics, Samsung C&T, Samsung Life Insurance, Hyundai Motor, Kia Motors, Hyundai Mobis, LG Electronics, LG Chem, POSCO International, Hanwha Life, E-Mart, and S-OIL were mentioned by CEO Score as falling into this category. Additionally, the approval rate for board resolutions by external directors in three financial holding companies such as Shinhan Financial Group, KB Financial Group, and Hana Financial Group was also reported as 100 percent.
Among them, many were recipients of salaries totaling hundreds of millions of won. Samsung Electronics’ outside directors received an average salary of 203.2 million won (US$154,290) per person. Hyundai Motor received 118.3 million won, LG Electronics received 104.3 million won, Hyundai Mobis received 102.8 million won, and Samsung C&T received 146.2 million won, all surpassing an average salary of 100 million won for outside directors.
Last year, Yuhan Corporation recorded the lowest board approval rate among outside directors at 90 percent. Yuhan Corporation’s outside directors cast 126 affirmative votes out of a total of 140 during last year’s board meeting, with 13 votes being deferred and 1 vote being abstained. SK recorded an approval rate of 90.7 percent, while SK hynix followed closely behind with 91.4 percent.
Kim Sung-chun, the chief research officer at CEO Score, stated, “In advanced countries, it is common for wealthy former or current CEOs to serve as outside directors in other companies, independently overseeing management. In contrast, in South Korea, it is more common for former or current bureaucrats or professors to take on the role of outside directors. While their salaries are high, their independence is often compromised.”