[비즈한국] The exercise of voting rights by the National Pension Service (NPS) is emerging as a key variable in the March annual general meeting (AGM) season. On the 24th, the NPS disclosed its voting intentions for agenda items at the AGMs of 34 listed companies, announcing its opposition to the appointment of Mirae Asset Securities006800 CEO Kim Mi-seop and Daishin Securities003540 Vice Chairman Yang Hong-seok as executive directors, as well as several amendments to the articles of incorporation for companies like Shinsegae004170 and Celltrion068270.
This AGM season is particularly notable as it is the first to be held since the scope of the NPS's pre-disclosures was expanded. In February, the Ministry of Health and Welfare announced that starting from this March's AGMs, the scope of pre-disclosing voting intentions would be expanded to include 'all agenda items for companies with a stake of 5% or more or a holding weight of 1% or more' and 'all agenda items for AGMs that include items decided upon by the Committee on Stewardship Responsibility.' The previous criteria was 'all agenda items for companies with a stake of 10% or more or a holding weight of 1% or more.'
Among the disclosed agenda items, the personnel appointments at securities firms stand out first. The NPS cited a history of damaged corporate value or infringement of shareholder rights as the reason for opposing CEO Kim Mi-seop, and a failure in the duty to monitor acts infringing upon shareholder rights for opposing Vice Chairman Yang Hong-seok. It also decided to oppose the appointment of SeAH Besteel Holdings001430 executive director Park Sung-jun, citing excessive concurrent positions.
Opposition to amendments to the articles of incorporation spanned across various industries. The NPS viewed Shinsegae's proposal as potentially functioning as a staggered board system, and opposed Celltrion and Krafton for reducing the cap on the number of directors. It also expressed opposition to LS Eco Energy's exclusion of electronic AGMs and the potential for shortened or extended terms for outside directors at HD Hyundai Electric and KC Tech.
Treasury share-related agenda items were also a major target for oversight. The NPS determined that the proposals for amending the articles of incorporation at CJ Logistics, Lotte Corp., Mirae Asset Securities, Celltrion, SK Innovation, and KC Tech had a high probability of being approved at the AGMs solely by the votes of major shareholders, despite concerns over treasury share holding and disposal plans. It also opposed plans by Hanwha Solutions, Celltrion, HD Hyundai Marine Engine, and Krafton to dispose of treasury shares for employee compensation purposes. The judgment is that using treasury shares for employee compensation after having disclosed that they were acquired for the purpose of enhancing shareholder value and protecting shareholder rights is inconsistent with the stated purpose of the disclosure.
Director compensation limit agenda items were no exception. The NPS decided to vote against the approval of director compensation limits at Hanwha affiliates such as Hanwha Solutions, Hanwha Aerospace, Hanwha Life, and Hanwha Vision, as well as at Shinsegae, Lotte Corp., Mirae Asset Securities, LG Household & Health Care, LG CNS, Celltrion, HD Hyundai Marine Engine, SK Innovation, and LS Eco Energy. It also opposed the approval of financial statements at CJ Logistics and Yulchon Chemical, citing the stewardship activity guidelines and excessive dividends, respectively.
This trend coincides with companies rushing to amend their articles of incorporation—including adjusting director terms, reducing board sizes, and refining standards for handling treasury shares—ahead of the implementation of the revised Commercial Act. In the second half of this year, the implementation of a revised Commercial Act is scheduled, which includes expanding regulations that limit the voting rights of major shareholders and their related parties to 3% when electing audit committee members, mandating cumulative voting, and expanding the separate election of audit committee members. The expansion of the NPS's exercise of opposition voting rights across personnel, compensation, treasury shares, and articles of incorporation demonstrates that the influence of institutional investors has grown significantly in this year's AGMs.