Korea developments in September
The Korean market presents a combination of attractive valuations and underlying reform catalysts. On the latter point, several important developments occurred during September:
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The second amendment to the Commercial Act came into force. This bars large listed companies from opting out of cumulative voting in their articles of incorporation, and the requirement applies from the first shareholders’ meeting held to elect directors after the effective date. It covers listed firms with assets above two trillion won, and it raises the number of audit committee members who must be elected separately to two. Despite some defensive measures from companies (e.g. staggered boards), we look forward to seeing the impact of cumulative voting in 2027 AGMs. ... more
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The twin themes
In Korea, it was good to see the second set of amendments to the Commercial Act passed on 25 August. Listed companies with assets exceeding two trillion won will now have to adopt cumulative voting, making it dramatically easier for minority shareholders to get at least one candidate onto the board. ... more