April 26, 2024

• 

[THE INVESTOR] Korea’s state pension operator is seeking to exert more influence in corporate shareholder meetings by disclosing its positions on key agenda items as it is poised to adopt a set of guidelines for institutional investors, sources said on July 13.

The National Pension Service is set to adopt the so-called stewardship code late this month, which refers to a set of principles or guidelines aimed at making institutional investors active and engaging in corporate governance in the interests of their beneficiaries.

According to the source, the Welfare Ministry, which oversees the NPS, has recently come up with a draft of the code, which, among other things, requires the pension operator to disclose its approval or disapproval of key agenda items of invested companies ahead of their annual shareholding meetings.

The rule is aimed at making the pension operator’s exercise of its voting rights more effective, which is expected to increase its influence in the annual shareholder meetings of companies, in which it has stakes.

It is also designed to provide other market participants with meaningful information and serve as a reference to other investors, according to the sources.

Despite holding large stakes in many companies, the NPS has been under flak for rubber-stamping key agenda items at shareholders meetings to serve the interests of large shareholders or management rather than small investors.

By Song Seung-hyun and newswires (ssh@heraldcorp.com)