SEOUL, South Korea (AP) — Samsung Electronics has officially named third-generation heir Lee Jae-yong as executive chairman, two months after obtaining a pardon from his conviction for bribing a former president in a scandal of corruption that overthrew a former South Korean. government.
Lee’s promotion is partly symbolic as he has led the Samsung Group in his capacity as the electronics company’s vice chairman since 2014, when his late father, former chairman Lee Kun-hee, suffered a heart attack. Lee’s legal troubles had been widely seen as a factor that prevented Samsung Electronics from quickly promoting him as chairman following his father’s death in 2020.
The 54-year-old is currently going through one of his toughest times as an executive at one of the world’s largest makers of computer memory chips and smartphones. Economic devastation wrought by Russia’s war on Ukraine and rising interest rates imposed by central banks to counter soaring prices have slowed consumer spending on tech devices and deflated chip shipments.
Samsung and other semiconductor makers are also navigating new U.S. restrictions on exports of advanced semiconductors and chipmaking equipment to China, as part of efforts to stop U.S. technology from making its mark. advance the Chinese army.
Samsung Electronics’ announcement that Lee is its new chairman came shortly after the company reported a 31% drop in profit for the three months to September, its first year-on-year decline in another of its quarterly profits in nearly three years.
The company said geopolitical uncertainties are likely to dampen demand at least through the first half of 2023. It said demand could pick up later next year, driven by chips needed for new data centers and computer products,
Lee had already been released from prison on parole for a year when President Yoon Suk Yeol pardoned him in August for the bribery conviction, an act of leniency that underscored the tech company’s enormous influence in the country.
Lee was found guilty in 2017 of bribing former president Park Geun-hye and her close confidante to gain government support for a merger between two Samsung subsidiaries that strengthened Lee’s control over the corporate empire. . Park and the confidante were also convicted in the scandal, and enraged South Koreans staged massive protests for months demanding an end to the murky ties between business and politics. The protests ultimately led to Park’s ousting from office.
Lee still faces a separate lawsuit for stock price manipulation and audit violations related to the 2015 merger.