Samsung has named its longtime de facto leader Jay Y. Lee as executive chairman.
The move, announced Thursday, formalizes who will continue to lead South Korea’s most valuable and well-known company. Mr. Li previously held the position of Vice Chairman.
Samsung’s board, which approved the change, “cited the current uncertain global business environment and the urgent need for greater accountability and business stability,” the tech giant said in a statement.
Just a few months ago, Lee Myung-bak, a descendant of one of South Korea’s most powerful families, was pardoned for crimes including corruption and bribery.
In August, Lee was personally absolved by the country’s president for alleged wrongdoing, with officials saying the economic crisis required the attention of his top business leader.
The pardon ended Lee’s five-year ban from official positions at Samsung. The billionaire has been jailed twice but has been on parole since last year.
Lee, also widely known as Lee Jae-yong, has been Samsung’s de facto leader since 2014, when his father fell into a coma after a heart attack. Lao Li passed away in 2020.
This week, Xiao Li marked the second anniversary of his father’s death, vowing to “protect his legacy” at a staff meeting on Tuesday.
“During this period, we had to face many challenges, and at times, it was difficult for us to make breakthroughs,” he said, according to remarks Samsung shared with CNN Business. “There is no doubt that we are at a critical moment.”
“Now is the time to plan our next move,” Li added.
The pledge coincides with an ambitious move Samsung announced in May, in which the group will pour more than $350 billion into its business and create 80,000 new jobs over the next five years.
Most of the work is expected to be in South Korea, and the funds will be used mainly for businesses such as chip manufacturing and biopharmaceuticals.
Samsung reported a 31 percent drop in operating profit on Thursday, with operating profit of nearly 10.9 trillion won ($7.6 billion) in the third quarter, compared with 15.8 trillion won ($11.1 billion) a year earlier.
The company warned in its earnings report that “weak demand for phones and TVs” was hurting its bottom line. The company said that while it expects “a partial recovery in demand in 2023,” global economic pressures are likely to continue to weigh on its results.
However, the group also enjoyed record sales. The company said third-quarter revenue had reached 76.8 trillion won (nearly $54 billion) despite a “challenging business environment” and still forecast its full-year revenue to exceed 2021.
Samsung shares rose nearly 1 percent in Seoul on Thursday following the news.
— CNN’s Yoonjung Seo in Seoul contributed to this report.