Samsung Electronics has confirmed plans to increase shareholder returns and bring in more independent directors, following pressure from investors. The Korean company said it also hired advisers to consider setting up a new holding company structure and listing its shares on foreign stock exchanges.
A review of the structural changes will take at least six months, Samsung said, adding that its board and management had not yet decided in favour of the new structure. In the more near term, the company pledged to increase shareholder returns to 50 percent of free cash flow in 2016 and 2017, at the top of the indicated range of 30-50 percent announced last year.
The cash returns will include a 30 percent increase in its total dividend this year, a continuation of the share buyback programme from January 2017, and the introduction of quarterly dividend payments from April 2017. Samsung said it will also review its cash position every three years to see whether there is excess cash for shareholder returns.
On the governance side, Samsung said it would add new, independent members to its board. It's working with advisers to name at least one independent member by the March 2017 AGM. A new Governance Committee will be set up later, made up entirely of independent board members. The Committee will address board decisions and proposals linked to enhancing shareholder value and also assume the responsibilities of the Corporate Social Responsibility Committee.
