Samsung’s visionary Chairman, Lee Kun-hee, has died

The Chairman of Samsung Group, Lee Kun-hee, died on Sunday after a long illness, aged 78. The succession plan has yet to be confirmed.

In 1987, Mr. Lee (pictured, image courtesy of Wikipedia) took over at the helm of Samsung (meaning “Three Stars” in Korean), founded by his father, Lee Byung-chul in 1938. The company was largely domestic facing and was focused more on quantity rather than quality. By the time he was incapacitated by a heart attack in 2014, in addition to becoming the wealthiest person in Korea and making Samsung the country’s biggest Chaebol, Mr Lee had transformed Samsung into the world’s largest maker of memory chips as well as flat-panel televisions and many white goods, overtaking their Japanese rivals. It had also become the world’s largest smartphone maker, having recently launched the Galaxy sub-brand, as well as displacing Nokia from its perch back in 2012.

“Chairman Lee was a true visionary who transformed Samsung into the world-leading innovator and industrial powerhouse from a local business. His legacy will be everlasting,” Samsung said in a statement.

Though electronics may be its most glamorous business, Samsung is much more than just electronics. The group has over 70 companies under the Samsung banner, actively providing products and services ranging from insurance, food and drinks, to fashion and entertainment.

Mr Lee’s reign at Samsung had been accompanied by controversies. Even his succession could be argued to have benefited from a big one in the family. As the youngest of three sons, his chance of inheriting the business was slim, until his two elder brothers landed in trouble with the government following the investigation of a saccharin smuggling case, including his second eldest brother serving prison time.

Mr Lee himself was indicted and convicted twice, for bribing in 1995 and for embezzlement and tax evasion in 2008. On both occasions he was given presidential pardon.

The Samsung statement does not spell out succession plans, though Mr Lee’s only son, Lee Jae-yong, known as Jay Y. Lee in the international business circle, has been heir apparent since his father’s absence in 2014, carrying the title of Vice Chairman (in addition to his CEO’s job at Samsung Electronics). Jay Y. is not without trouble of his own though. He was sentenced to five years in prison in 2017 for “bribery, embezzlement and perjury”. He was released in early 2018 after the appeals court suspended his sentence.

Nearly three decades ago, in 1993, the late Mr Lee gathered his management team in Frankfurt, when he famously gave the rallying call of “change everything except your wife and kids”, to challenge the team to the transformation tasks in front them. When Jay Y. takes over, he is likely to face an equally, if not more challenging task of defending Samsung’s position. The slowdown in microchips and display markets as well as the competition and commoditisation of smartphones are only the challenges he needs to navigate in Samsung Electronics. When he takes over the stewardship, he most likely will no longer be able to spend 95% of his time on Samsung Electronics, as he told the media earlier.

Mr Lee Kun-hee is survived by his wife Hong Ra-hee, their son Jae-yong (Jay Y.). and their two daughters Boo-jin and Seo-hyun. The editorial team would like to send our deepest condolences to Mr Lee’s family and the Samsung community.

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