South Korea's Financial Services Commission and Korea Exchange expand disclosures on shareholder protection and returns for 2027 reports

South Korea's Financial Services Commission and the Korea Exchange have revised corporate governance reporting guidelines to strengthen disclosures on shareholder protection, cumulative voting and shareholder returns. The changes apply to reports submitted in 2027 under a framework extended to all KOSPI listed companies in 2026. The additional reporting on subsidiary listings follows stricter rules effective Aug. 3, 2026, requiring parent shareholder consent for listings of subsidiaries created through business splits. Companies must disclose whether they use cumulative voting and explain the reasons for changes to board size or directors' terms, including their effect on cumulative voting. This addresses concerns about circumvention of the Commercial Act requirement for listed companies with assets of at least KRW 2 trillion to use cumulative voting when electing two or more directors. Companies pursuing parent and subsidiary listings or equity offerings must disclose shareholder protection measures and communication with shareholders, including minority investors. Completed or planned equity offerings must also be detailed, including their size and discount, use of proceeds and controlling shareholder participation. Reports must state the annual report filing date and explain any failure to file at least two weeks before the shareholder meeting. They must also disclose whether dividend information, including amounts, was available six weeks before the meeting, the statutory deadline for shareholder proposals. Disclosures on treasury share purchases, cancellations and holdings will include the latest three years of information alongside current year data.