Expansion of 'Shareholder Proposals' Across Listed Companies Including Large Corporations

Sense of Crisis Spreads Across Listed Companies Including Emart, Coway, and Cha Bio... Emergency in Securing Voting Rights
Locomotive Handles Proxy Voting for 10 Firms Including SK Securities and Youngpoong... Secures 60 Million Shares and 18,000 Shareholders' Votes
"Alongside Securing Voting Rights, Communication Channels with Shareholders Through PR and IR Are Essential"

Recently, shareholder proposals through activist funds and small shareholder coalitions have been gaining momentum.

With the activation of online shareholder action platforms strengthening the cohesion of small shareholders, and the Commercial Act amendments aimed at enhancing shareholder rights?such as the duty of shareholder loyalty and mandatory electronic shareholder meetings?showing signs of passing, companies are facing an emergency in securing voting rights alongside establishing major shareholder policies.

In fact, while shareholder activism in the past was relatively limited to small and medium-sized enterprises with weak governance, recently the sense of crisis has spread across listed companies, including large corporations such as Emart, Coway, Cha Bio, and Hyundai Motor Securities.

This reflects the analysis that as shareholder proposals by activist funds and small shareholders become more active, the number of listed companies seeking proxy voting agencies is also increasing.

Within the industry, there is a growing call to preemptively hire proxy voting agencies as a countermeasure to effectively prepare for shareholder activism, including management disputes and shareholder proposals. Since shareholder activism can pose a burden to companies, thorough preparation to protect management rights in advance and strengthen cooperative relationships with shareholders is essential.

Locomotive, a proxy voting specialist firm, handled proxy voting services for 10 companies during the regular shareholder meeting season in March this year.

Locomotive conducted proxy voting services for 10 listed companies, including those involved in management disputes or shareholder proposals such as Youngpoong and SK Securities.

This year, Locomotive successfully secured voting rights for 60 million shares, targeting 18,000 shareholders out of a total of approximately 410,000 shareholders across the 10 companies. In particular, T-plex succeeded in securing shares amounting to 15.7% of its total issued shares, and SK Securities also achieved securing over 10% of voting rights.

According to shareholder visit analysis, 46.5% of shareholders were confirmed to reside at their addresses through direct visits, a decrease of about 1.4% compared to 47.9% last year. Cases where face-to-face contact was impossible due to directors or unknown addresses accounted for 8.9%.

Locomotive is a proxy voting agency with over 20 years of accumulated know-how in securing voting rights, utilizing a proprietary computer program for real-time status aggregation, and possessing more than 500 specialized personnel for voting rights acquisition across over 50 regional bases nationwide.

Lee Tae-sung, CEO of Locomotive, emphasized, “As cases of voting rights battles with small shareholder coalitions due to management disputes are rapidly increasing, securing voting rights for management defense alongside shareholder-friendly policies is more urgent than ever from a corporate perspective. In addition to securing voting rights, it is important to continuously keep communication channels open with shareholders by conducting PR and IR activities to enhance corporate and shareholder value.”