Financial Services Commission Revises Corporate Governance Report Guidelines
Starting next year, corporate governance reports submitted by companies must include whether dividend procedures have been improved, any instances of executives' private interest appropriation, and violations of accounting standards.
On the 12th, the Financial Services Commission disclosed guidelines on the mandatory disclosure scope of corporate governance reports containing these details. This will apply to KOSPI-listed companies with assets exceeding 500 billion KRW starting next year. The corporate governance report disclosure system requires companies to disclose compliance with key governance principles and explain reasons if they fail to comply.
According to the guidelines, from next year, companies must disclose dividend procedure improvement plans and communication details with foreign investors. Companies must disclose whether dividend procedures have been improved so that investors can decide on investments based on dividend amounts, as well as communication details with minority shareholders and overseas investors, diversity in gender, age, and experience within the board of directors, and the status of capital raising (such as paid-in capital increases) involving differing interests among shareholders.
Additionally, private interest appropriation, unfair support, and violations of accounting standards must be disclosed. Until now, only executives' legal violations related to embezzlement, breach of trust, and unfair trade were disclosed. However, the disclosure period has been adjusted to up to five years after the completion of sentence execution.
Companies required to issue corrective disclosures due to poor disclosure will be recommended to participate in separate training, and from 2025, companies that repeatedly make poor disclosures will have their names and detailed information publicly disclosed.
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