Investor and Civil Society Meeting on Shareholder Rights Held on the 4th
Jin Seongjun: "The Yoon Administration Has Also Repeatedly Mentioned This... The Ruling Party Must Cooperate"
The Democratic Party of Korea, along with small investors and asset management companies, urged the prompt passage of the amendment to the Commercial Act, which was not brought to the plenary session last month. They argued that a transparent and fair market must be established for the domestic stock market to gain trust and for its value to finally rise.
At a meeting for investors and civil society to protect shareholder rights held at the National Assembly in Yeouido at 2 p.m. on the 4th, Jin Seong-jun, the Policy Committee Chair of the Democratic Party, stated, "Despite promises from the President, the Deputy Prime Minister for Economy, and the Financial Supervisory Service Governor to amend the Commercial Act to protect the rights of small shareholders, the situation is directly opposing this." He cited the government, including President Yoon Seok-yeol and Choi Sang-mok, Acting President and Minister of Strategy and Finance, mentioning the amendment to the Commercial Act last year as an example.
The amendment to the Commercial Act passed the National Assembly's Legislation and Judiciary Committee and was scheduled to be submitted to the plenary session on the 27th of last month, but its processing was delayed after Speaker Woo Won-shik withheld it. The amendment passed by the Legislation and Judiciary Committee includes ▲expanding the duty of loyalty of directors to all shareholders ▲mandatory introduction of electronic shareholder meetings. However, △mandatory cumulative voting △expansion of separate election of audit committee members △allowing advisory shareholder proposals have yet to pass the standing committee.
Chairman Jin said, "If the government and the People Power Party are sincere about retail investors, they should cooperate with the amendment to the Commercial Act to protect the rights of small shareholders and enhance the value of our stocks," adding, "I hope that today's meeting will serve as an opportunity to reaffirm why the amendment to the Commercial Act is urgent and necessary through the voices of civil society, small investors, and asset management companies."
Participants in the meeting argued that the amendment to the Commercial Act must be passed to strengthen market transparency. Lee Sang-mok, representative of the DB HiTek Small Shareholders Solidarity, cited examples such as DB HiTek's investment execution in the golf course 'DB World' and the attempted split and merger of Doosan Enerbility and Doosan Bobcat, saying, "The 'duty of loyalty to shareholders' clause in the amendment to the Commercial Act is intended to prevent such cases."
Cheon Jun-beom, Vice Chairman of the Korea Corporate Governance Forum, said, "I hope that while amending the Commercial Act, attention will also be paid to follow-up legislation on guidelines," and requested, "Since the passage of the amendment is expected to be early, I hope the implementation date will be set generously and practical preparations will be made."
Democratic Party lawmaker Lee So-young said, "It has been 18 years since our KOSPI index surpassed 2000, and today it is 2500," adding, "It has been stuck in the 2000s box for 18 years." Lawmaker Lee said, "Our companies and industrial sectors are improving their performance, but stock values are undervalued," and added, "I believe the amendment to the Commercial Act is the first step to instill trust in the market and to make people believe that investing in good companies can lead to success."
Lee Jeong-moon, Senior Deputy Chair of the Democratic Party Policy Committee, said, "The amendment to the Commercial Act has passed the Legislation and Judiciary Committee with difficulty, but it is currently paused at the last hurdle. However, once it is submitted to the next plenary session, we will make sure it passes," adding, "The government may exercise the right to request reconsideration, but we believe this will be difficult, and we will maintain vigilance and interest until the end."
© The Asia Business Daily(www.asiae.co.kr). All rights reserved.
