Sangjanghyeop Advisory Committee Opposes Yulchon Chemical and Emart's Recommendatory Shareholder Proposals

The Governance Advisory Committee, an independent body affiliated with the Korea Listed Companies Association, announced on the 24th that it has decided to oppose shareholder proposals including the introduction of cumulative voting at Yulchon Chemical and the disclosure of corporate value enhancement plans by E-Mart.

Regarding Yulchon Chemical's proposal to introduce a cumulative voting system, the Governance Advisory Committee explained, "The proportion of independent outside directors is high, and there have been no recent cases of management misconduct or corporate value damage," adding, "there is insufficient necessity to introduce cumulative voting, so we oppose it." It further stated, "As for the mandatory electronic voting, the actual usage rate is low, so there is no need to make it mandatory, and we oppose it."

It also explained, "We oppose advisory shareholder proposals because the concept of advisory effect is unclear and there is a risk of violating the Commercial Act," and "We oppose the introduction of a remuneration review system as well, due to the unclear advisory effect and the need to review potential labor law violations related to including remuneration for unregistered executives."

On the other hand, the committee supported the company proposal to introduce an audit committee system in the articles of incorporation. It also stated, "We express a neutral opinion on whether the regularization of investor relations meetings should be mandated through the articles of incorporation, as there is some doubt," while acknowledging "the need to strengthen communication with investors."

Regarding E-Mart, the committee opposed the shareholder proposal for disclosure of corporate value enhancement plans. The advisory committee explained, "This is not stipulated as a matter within the authority of the shareholders' meeting under the Commercial Act or the articles of incorporation," and "the meaning of the advisory effect is unclear, so we oppose it."