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• corporate governance and management system

corporate governance and management system

SAMSUNG Electronics’ decision-making and supervisory process enhances corporate transparency and accountable management and thus, constitutes an environment where creative and progressive entrepreneurship can be maximized. SAMSUNG Electronics pursues the management philosophy favorable for every stakeholder in order to prevent certain stakeholders disadvantaged.

• corporate governance
• board committees
• other special committees (non-BOD committees)

board committees

For enhanced efficiency in BOD operation, Board committees were established under the BOD in accordance with relevant laws and some of the Board authority was delegated to the committees, each of which is filled with Directors who can bring their expertise and experience to the assigned committee.

Each agenda approved by board committees is instantly notified to all Directors, and each Director may call for the convocation of Board meetings within two days from the notice. The Board of Directors may put the resolutions approved by the committees for voting at the Board meeting.

Besides Management Committee, Audit Committee, and Independent Director Recommendation Committee, committees which the BOD recognizes their necessity may be established in accordance with Articles of Incorporation.

audit Committee

Audit Committee established in 2000 to replace the then existing auditors is a committee under the Board of Directors that supervises and supports management in a way that may maximize corporate value through checks and balances. The Audit Committee must be comprised of more than three directors and more than two thirds of whom shall be Independent Directors under the law. However, the Audit Committee is currently composed of committee members who are all Independent Directors to enhance independence of the Committee. It has authority to audit business of the Company, authority to request reports on the business status of the Company and investigate assets of the Company, authority to receive reports from Directors, authority to investigate subsidiaries of the Company, authority to request to stop any acts in violation of laws and regulations or the Articles of Incorporation, authority to request the convocation of a general meeting of shareholders, and authority to get professional assistance at the Company's expense..

independent director recommendation committee

The Independent Director recommendation Committee is a committee under the Board of Directors to recommend independent director candidates in a transparent and independent way. The Independent Director recommendation Committee shall comprise at least two but no more than four Directors, more than half of whom shall be Independent Directors. The committee was established in Feb. 2001 by creating the clauses related to its establishment in Articles of Incorporation in 2000. The Board decides on candidates for Independent Directors among the potential candidates recommended by the committee and submits the names of the final candidates for resolution at a general meeting of shareholders.

Related Party Transactions Committee The Related Party Transactions Committee is a committee under the Board of Directors that was established in April of 2004 to enhance corporate transparency and promote fair transactions.

The Committee shall comprise three Independent Directors, and the head of the committee is appointed by resolution at a general meeting of shareholders. It has authority to receive reports on related party transactions, authority to order investigations on related party transactions, and authority to recommend corrective measures for unfair related party transactions. For enhanced transparency, the company made it a rule that the Committee deliberates related party transactions in advance in case they are over KRW10 billion.

management committee

Management Committee is a decision-making body deliberating and deciding matters concerning management of the company, including management policies, strategies, and business plans. It deliberates and decide general management details such as business restructuring and strategic partnership with overseas partners and financial matters including overseas direct investment and investment on other corporations less than 10% of the capital.

The Management Committee recognizes the significance of social and environmental issues which are not directly related to the management, and the focus on such issues is reflected when it deliberates capital spending and donation.