Samsung Leadership

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Samsung has come to face a leadership vacuum in the wake of Samsung Electronics Vice Chairman Lee Jae-yong's arrest. For the time being, the top business group is expected to maintain an emergency leadership system centered on affiliate chiefs.

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The Samsung Group, which was on edge overnight as it waited for a court decision on Samsung Electronics Vice Chairman Lee Jae-yong's arrest, was unable to hide its shock when the arrest warrant was issued. A leadership vacuum has become inevitable for Samsung in the wake of the first arrest of the group's top official since its founding. Roughly two hours after the arrest warrant was issued, Samsung issued a short statement that it will exert its best efforts for the truth to be revealed in court. The court decision is likely to be all the more unsettling for the Samsung Group, given that Lee's arrest came at a time when the company was reorganizing its corporate structure to be centered around him. With indictments also likely for Choi Ji-sung, head of Samsung's Future Strategy Office control tower, as well as deputy leader Jang Choong-ki, it appears that the group's leadership will be forced to focus on its legal response. As a result, Samsung is likely to launch an emergency management system led by the heads of each affiliate. For the time being, Samsung is expected to push forward with its usual investments in equipment while holding off efforts to reorganize corporate structure, make large-scale investments, or dissolve the Future Strategy Office as part of revamping efforts. Attention is being drawn to how Lee's arrest will affect Samsung's decision to acquire U.S. automotive electronics provider Harman International Industries for roughly 8 billion dollars, as a shareholders' meeting to finalize the decision will be held Friday evening.