Opposition Rate Rises at Asset Management Firms, But 40% Provide Insincere Reasons for Voting Decisions

Voting Participation Rate Rises from 91.6% to 91.8%
Opposition Rate on Agenda Items Increases from 6.8% to 8.2%
Formal Explanations Like "Minimal Impact on General Shareholders' Meeting" Persist

Domestic asset management companies are becoming more active in exercising shareholder rights, as both the voting participation rate and opposition rate at general shareholders' meetings have increased. However, it was found that more than 4 out of 10 asset management companies provided only formal explanations for their voting and non-voting decisions.

According to the Financial Supervisory Service's "2026 Asset Management Company Voting Status and Inspection Results" released on July 6, 285 asset management companies exercised their voting rights on 91.8% (42,981 items) of 46,827 agenda items from April last year to the end of March. This voting participation rate represents a slight increase from the previous year's 91.6% (26,532 items).

The rate of opposition by asset management companies also rose during the same period, from 6.8% (1,973 items) to 8.2% (3,848 items). The most common types of opposition were, in order, amendments to articles of incorporation (1,200 items), appointment or dismissal of directors and auditors (1,163 items), and executive compensation (1,006 items).

Of the 285 asset management companies, 121 provided insincere explanations for their voting and non-voting decisions. These companies cited perfunctory reasons such as "minimal impact on the general shareholders' meeting" or "no infringement of shareholder rights." Some private equity asset management companies used identical explanations for different agenda items, such as executive appointments and amendments to articles of incorporation, making it difficult to understand the basis for their decisions.

Some companies also failed to properly disclose internal guidelines or follow the Korea Exchange's disclosure format. Fifty-nine companies did not disclose detailed guidelines specifying the grounds for exercising voting rights on each agenda item, while fifty-one companies did not reflect revisions to their voting guidelines, indicating that they operated their guidelines only formally. In addition, eighty-seven companies failed to state the agenda item name, sixty-eight companies did not specify the agenda type, and one hundred thirty-four companies omitted their relationship to the relevant corporation.

An inspection of 67 public offering asset management companies found that 18 have dedicated teams for exercising shareholder rights, while the remaining 49 have no such organization. Forty companies have established separate decision-making bodies for reviewing major agenda items, and only 20 companies reflected performance on voting rights work in their key performance indicators (KPIs).

A Financial Supervisory Service official said, "Most of the shortcomings occurred at small private equity asset management companies, so we will strengthen guidance on voting rights exercise and disclosure for these companies going forward."

This content was produced with the assistance of AI translation services.