Grandson of Samsung’s founder takes management of empire as earnings fall

Samsung Electronics has appointed Lee Jae-yong — who is thought within the West as Jay Y. Lee — as its government chairman, giving the grandson of the corporate’s founder formal management, the South Korean tech giant announced today. The announcement got here on the identical day that Samsung introduced a sequence of disappointing earnings results, as earnings fell 23 % in comparison with the earlier quarter.

Based on Samsung’s official announcement justifying the appointment, “the Board cited the present unsure international enterprise surroundings and the urgent want for stronger accountability and enterprise stability in approving the advice.” Samsung is at the moment battling a hunch in demand for a number of of its key companies together with reminiscence chips, cellphones, and TVs. It doesn’t anticipate demand to select again up till the second half of next year.

Lee’s ascension is unlikely to alter a lot for the corporate within the quick time period, Bloomberg notes, given he’s lengthy served as Samsung’s de-facto chief. However formally taking management means Lee can take larger strategic selections to steer the corporate via a turbulent financial interval, together with pushing via acquisitions, mergers, and funneling funding into rising applied sciences.

54-year previous Lee succeeds his father, Lee Kun-hee, as head of South Korea’s largest firm following his death in October 2020. Lee Kun-hee had been incapacitated for years after struggling a coronary heart assault in 2014. The youthful Lee had been embroiled in a corruption and bribery scandal since 2017, and been despatched to prison twice. Lee was given a presidential pardon in August this year, paving the way in which for him to take formal management of the electronics large. The pardon was paying homage to the 2 given to Lee’s father, who was convicted of corruption and tax evasion in 1996 and 2008.

“Unquestionably, we’re at a pivotal second,” Lee stated in an announcement reported by Bloomberg. “Now’s the time to plan our subsequent transfer. Now’s the time to behave, to be daring and unwavering in our focus.”