Seoul: Samsung Electronics has officially appointed third-generation successor Lee Jae-yong as executive chairman, two months after he waived his sentence for bribing a former president in a corruption scandal that hit the last The South Korean government was toppled.
Lee’s promotion is symbolic in part because he has led the Samsung Group as the electronics company’s vice president since 2014, when his late father, former chairman Lee Kun-hee, suffered a heart attack.
Lee’s legal troubles were widely seen as a factor that prevented Samsung Electronics from being quickly promoted to chairman following the death of his father in 2020.
The 54-year-old is now navigating one of his toughest parts as the leader of one of the world’s largest manufacturers of computer memory chips and smartphones.
Rising interest rates imposed by central banks to counter the economic devastation caused by Russia’s war on Ukraine and rising prices have slowed consumer spending on technology equipment and deflated chip shipments.
Samsung and other semiconductor makers are navigating new US sanctions on exports of advanced semiconductor and chipmaking equipment to China, as part of efforts to prevent US technology from advancing to China’s military.
Samsung Electronics’ announcement that Lee is its new president came shortly after the company reported a 31 percent drop in profit for the three months through September, its first year-over-year decline in quarterly profit in nearly three years.
The company said geopolitical uncertainties are likely to reduce demand until at least the first half of 2023. It said demand could improve towards the end of next year, driven by the chips needed for new data centers and computer products,
Lee had already been out of prison on parole for a year when President Yoon Suk Yeol pardoned him for a corruption sentence in August, a liberal underlining the tech company’s enormous influence in the country. There was work.
Lee was convicted in 2017 of bribing former President Park Geun-hee and his close confidant to gain government support for a merger between two Samsung affiliates that tightened Lee’s control over the corporate empire.
Park and Confidant were also indicted in the scandal and enraged South Koreans staged months of mass protests demanding an end to the shady relationship between business and politics.
Park was eventually thrown out of office due to demonstrations.
Lee still faces a separate trial on charges of stock price manipulation and auditing breaches related to the 2015 merger.