Hyundai Motor Co., South Korea’s largest automaker, will actively consider launching a committee tasked with improving the company’s governance structure and increasing communication with shareholders, its head said Friday.
The remarks by Hyundai Motor CEO Kim Choong-ho came in response to a foreign investor’s proposal during an annual general meeting of shareholders to launch such a committee inside the board of directors.
“We are actively considering it,” Kim told shareholders. “In particular, we will look into the proposal by taking into account business conditions and the environment.”
Kim, who chaired the meeting, added that the company is seeking to better inform shareholders about the company’s decision-making through disclosures.
The proposal for a governance committee was made by Park Yu-kyung, a director of a Netherlands-based pension fund operator.
Park asked Hyundai Motor to use the committee as a channel through which it can tackle shareholders’ concerns about the company, while enhancing its governance structure on par with global standards.
She also suggested the automaker designate an outside director to represent shareholders’ interests by meeting investors on a regular basis and relaying their opinions to the company.
The automaker has been criticized by investors angered that the company did not heed their opinions in deciding to spend 10.55 trillion won (US$9.38 billion) to purchase an expensive plot of land in southern Seoul last year. The deal led to falls in company share prices on fears that it would undermine its finances.
One shareholder expressed concerns that Hyundai Motor shares have dropped “too much” over the past year even when reflecting unfavorable business conditions. He urged the company to do its best to enhance shareholders’ value.
Meanwhile, Hyundai Motor said that it will expand investment on research and development and product quality to achieve its objective to produce and sell 5.05 million vehicles this year. (Yonhap)
