Enhancing the Soundness of Venture Investment Through Private Sector Self-Regulation

Recruitment of Companies for Venture Capital Self-Regulation Program

The Ministry of SMEs and Startups and the Korea Venture Capital Association announced on September 16 that they have issued a call for companies to participate in the "Venture Capital Self-Regulation Participation Program" and are now accepting applications from interested firms.

Until now, systems and regulations related to venture investment have been operated under government leadership. However, as the investment ecosystem grows and the influence of venture capital expands, there has been a growing need to introduce a private sector-led, preventive self-regulation framework to enhance the soundness of the venture investment market.

To encourage the voluntary adoption of self-regulation by the private sector, the Ministry, together with the Association, established a new self-regulation evaluation system this year. The evaluation targets venture capital firms that participate voluntarily and is conducted by the Association, which reviews criteria such as the establishment of self-regulatory governance, ethical guidelines, internal controls to prevent conflicts of interest, standards for handling venture investment fund trustee work, and anti-money laundering work. Based on this review, a total of six grades are assigned.

The Ministry will grant additional points in the selection process for the Korea Fund of Funds investment program from 2026 onward to venture capital firms that receive high evaluation scores. The top two firms will also receive ministerial commendations. In addition, the Ministry plans to publicly release the list of highly rated venture capital firms to promote a transparent and responsible venture investment culture.

Kim Bongdeok, Director of Venture Policy at the Ministry of SMEs and Startups, stated, "The self-regulation evaluation is an important opportunity for the venture capital industry to enhance its own credibility," adding, "The government will actively support private sector efforts to establish a responsible investment culture and ensure that outstanding venture capital firms become role models in the market."

Kim Hakgyun, Chairman of the Korea Venture Capital Association, commented, "This self-regulation evaluation is significant in that it is a voluntary code established based on the industry's own sense of responsibility," and added, "Private sector-led self-regulation will enhance the transparency and reliability of the venture investment market."