Sustinvest and Korea Zinc Recommend Support for 'Cumulative Voting System' and 'Limit on Number of Directors'

"Cumulative voting can enhance management transparency"
Seven new directors recommended from MBK

The voting advisory firm Sustainvest has recommended full support for all proposed amendments to the articles of incorporation put forward by the current management of Korea Zinc, including the 'cumulative voting system' and the 'setting of an upper limit on the number of directors.'

Sustainvest released an analysis report on the agenda for the Korea Zinc extraordinary general meeting scheduled for the 23rd, explaining that it recommends approval of the cumulative voting system because "it is positively judged as it can protect the interests of minority shareholders and enhance management transparency."

Korea Zinc, which is undergoing a management rights dispute, held an emergency board meeting at its headquarters in Jongno-gu, Seoul, on October 30 last year.

It also recommended approval of the proposal to limit the number of directors to 19 or fewer. Sustainvest pointed out, "If the number of directors is excessively large, the responsibility and authority of each director may be weakened," and "if it becomes difficult to coordinate opinions, inefficiencies in board operations may occur."

However, it recommended that all seven newly appointed directors be filled exclusively by personnel from MBK and Youngpoong. It opposed the entry of MBK Vice Chairman Kim Kwang-il and Youngpoong President Kang Seong-du into the board.

Sustainvest emphasized, “Maintaining the current management while strengthening the board’s independence, supervision, and advisory functions, and stably maintaining the current organization while smoothly advancing new business plans, better aligns with long-term shareholder value.”

In addition, it recommended full support for other amendments to the articles of incorporation proposed by the current management of Korea Zinc, stating that they are expected to protect minority shareholders’ rights, strengthen board independence and transparency, enhance shareholder value, and improve dividend predictability.

A Korea Zinc official emphasized, "It has also been clearly stated that the current management’s successful leadership of the new business strategy, represented by the Troika Drive, will help enhance long-term shareholder value for the company’s mid- to long-term growth and development."