Value-Up Program Loses Momentum Due to Yoon Administration Label
No Value-Up Disclosures from Samsung, POSCO, Hanwha, GS Group
Ongoing Efforts for Commercial Act Amendments Led by Political Circles
"Would Samsung Electronics now try to announce a value-up disclosure?"
As the impeachment trial procedure against President Yoon Suk-yeol intensifies, concerns are growing in the financial investment industry about the weakening momentum of the current administration's core capital market policy, the corporate value-up (value enhancement) program.
A capital market expert familiar with the 'value-up' policy said, "At this point, companies are unlikely to actively make value-up disclosures labeled as policies of the Yoon administration."
According to the Financial Supervisory Service's electronic disclosure system on the 20th, a total of 97 companies have made value-up disclosures so far, including 86 companies with corporate value enhancement plans (voluntary disclosures) and 11 companies with advance notices of corporate value enhancement plans.
Even after the martial law incident on the 3rd, companies such as Industrial Bank of Korea, Patron, KG Inicis, Inox Advanced Materials, Yuanta Securities, Hyundai Elevator, HD Hyundai Construction Equipment, AK Holdings, Jeju Air, HD Hyundai Mipo, HD Hyundai Heavy Industries, HD Korea Shipbuilding & Offshore Engineering, Aekyung Chemical, Doosan Bobcat, HD Hyundai, HD Hyundai Infracore, HD Hyundai Marine Solutions, HD Hyundai Electric, LG Electronics, NH Investment & Securities, and Aekyung Industrial presented their value-up plans as scheduled.
However, among nearly 100 value-up disclosures currently, value-up disclosures from Samsung, POSCO, Hanwha, and GS Group are still hard to find. Four groups within the top 10 conglomerates have yet to participate in value-up disclosures.
The value-up program relies on voluntary participation by companies, but with the current administration's continuity becoming uncertain and the failure of the inheritance and gift tax law amendment bill, there are criticisms that the driving force for companies to push forward has significantly diminished.
Democratic Party-led 'Commercial Act Amendment' Efforts Ongoing... Actual Amendment Faces Challenges
Of course, efforts for value-up by the financial and political sectors continue. On the 18th, the Korea Exchange held a briefing session for disclosure officers of KOSDAQ-listed companies to promote corporate value-up. On the 19th, Lee Jae-myung, leader of the Democratic Party of Korea, held a policy forum to prepare an amendment to the Commercial Act aimed at expanding directors' duty of loyalty to shareholders.
If the Commercial Act is actually amended, the value-up policy to resolve the Korea discount could see a groundbreaking turning point. Last month, the Democratic Party proposed a party bill to amend the Commercial Act, focusing on expanding the duty of loyalty of directors. However, considering concerns from the business community, the Democratic Party is reviewing measures to ease the requirements for breach of trust charges.
The amendment bill is currently pending in the Legislation and Judiciary Committee. The Democratic Party plans to hold a public hearing on the 30th in the committee's subcommittee and aims to process the amendment bill in the plenary session as early as early next year. Although the Democratic Party targets passage within this year, delays in the review schedule make it physically difficult for the bill to pass the National Assembly plenary session within this year.
A capital market official said, "It is true that the value-up momentum has weakened as the business community opposed the Commercial Act amendment led by the current administration, causing a sharp change in direction," adding, "Although the Democratic Party has taken the lead, it remains to be seen whether the amendment to the Commercial Act can actually be realized in such an unstable political environment."
© The Asia Business Daily(www.asiae.co.kr). All rights reserved.
