The POSCO Board of Directors has 15 members, nine of whom are independent outside directors. As the company’s highest decision-making body, the Board deliberates mid- and long-term business strategy as well as making major business decisions.

In 2003, the Board convened eight times with a 95% average attendance rate. A total of 46 agenda items were deliberated and resolved, including the construction of the Gwangyang No. 5 Continuous Galvanizing Line, plans for stock buyback and cancellation, an expansion project at Zhangjiagang POSCO Stainless Steel in China, and the establishment of POSCO China Holding Corporation in Beijing to facilitate business in China.

During the year, the Director Candidate Recommendation and Evaluation Committee held seven meetings, taking up 15 agenda items related to outside director nominations, candidate qualification screening, and corporate management performance evaluation.

The Finance and Operation Committee held nine meetings, taking up 20 agenda items, including the establishment of BX Steel POSCO Cold Rolled Sheet Co., Ltd., a joint venture with Benxi Iron & Steel of China. Eight of the items were resolved by the committee under authorization granted by the Board, while recommendations for the remaining 12 were delivered to the Board for approval.

The Executive Management Committee met 14 times, deliberating 35 agenda items.

The Audit Committee, which is composed of four outside directors, met six times to deliberate and approve contract terms with the external auditor and the results of the 2002 fiscal year audit. The committee also reviewed the 2003 results on a quarterly basis.

In addition to the business mentioned above, the Board took significant steps to improve the company’s governance structure. Aiming to strengthen managerial and accounting transparency, the Board began by reviewing recent changes in domestic and overseas governance regulations and benchmarking the best practices of major global corporations. At the same time, the Board commissioned a professional research institute to identify specific governance areas in need of improvement. Finally, the Board hosted an open seminar on December 3, 2003 to gather feedback from the full spectrum of our stakeholders.

As a direct result of the above activities, the Board resolved to raise the proportion of outside directors from 8 to 9 to reinforce its independence, adopt cumulative and write-in voting systems to strengthen the protection of shareholder rights, and delete a clause in the articles of incorporation regarding convertible preferred share issuance. These proposals were presented and approved at the annual shareholders’ meeting held on March 12, 2004.