National Pension Service to Withdraw from Hanjin Kal Management Participation... Shift to Passive Investment

Fund Management Committee Holds 2nd Meeting of 2022

[Image source=Yonhap News]

[Asia Economy Reporter Jang Sehee] The National Pension Service's highest decision-making body, the Fund Management Committee, has decided to withdraw from management participation in Hanjin Kal.

On the 29th, the National Pension Fund Management Committee held the 2nd Fund Management Committee meeting of 2022 at the Plaza Hotel in Jung-gu, Seoul, and changed the purpose of holding Hanjin Kal shares from management participation to simple investment.

Previously, in February 2019, the Fund Management Committee changed the purpose of holding Hanjin Kal shares to management participation to submit shareholder proposals, citing misconduct such as breach of trust and embezzlement by the management of Korean Air and Hanjin Kal.

Regarding this decision, the committee explained, "If the purpose of holding shares continues to be management participation, considering restrictions such as prohibition of additional acquisition and exercise of voting rights if the shareholding ratio in Hanjin Kal exceeds 5% in the future."

Meanwhile, the committee received reports on the revision of the National Pension Fund operation guidelines, the status of establishing mid-term asset allocation, and the final results of research on the scope and standards for coal mining and power generation industries of the National Pension Fund.

The operation guidelines of the National Pension Fund are adjusted to align with the rapidly changing financial market environment.

The committee explained the reason for the revision, stating, "The current indicators do not adequately capture the risks associated with the increase in risky assets and act as constraints on the active asset management of the National Pension Fund."

Decarbonization through investment restrictions on the coal mining industry, one of the main agenda items of the meeting, is expected to undergo further discussion.

Meanwhile, the committee members attending the meeting expressed concern about facing a difficult investment environment due to the expansion of uncertainty in the global financial market caused by international geopolitical instability, urging the Fund Management Headquarters to continuously monitor the market and make their best efforts to secure returns.