As soon as the March shareholders' meeting season ended, corporations' value-up disclosures also sharply declined. Although the government promised to commend excellent listed companies for value-up initiatives and offered incentives for audits and sanctions, only 5% of all listed companies participated in the disclosures. Amid the early presidential election climate following the president's impeachment, there is a mood within the business community that there is no urgency.
According to the Korea Exchange's corporate disclosure information system (KIND) on the 18th, only four corporations disclosed value-up plans as of April 17. Three KOSPI-listed corporations, including HANMI Semiconductor, Dongwon Systems, and Hanatour, and one KOSDAQ-listed corporation, STraffic, are among them.
Value-up disclosures are divided into advance notifications (guidance disclosures), actual disclosures (voluntary disclosures), and interim disclosures of existing disclosure corporations (implementation status). Considering that value-up disclosures in February and March were 16 and 20, respectively, the number has significantly decreased in April. This is attributed to many corporations issuing value-up disclosures in line with the March shareholders' meeting season.
Additionally, the fact that former President Yoon Suk-yeol was impeached and an early presidential election climate began is likely another reason for the recent scarcity of value-up plan disclosures. The Constitutional Court decided on the impeachment of former President Yoon with unanimous consent from all justices on the 4th at the Supreme Court in Jongno-gu, Seoul. The government officially set the date for the 21st presidential election for June 3 during a Cabinet meeting on the 8th.
Given this situation, even though the government is offering various benefits to encourage participation in value-up disclosures, the response from listed companies is inevitably lukewarm. The financial authorities plan to commend outstanding value-up corporations every May. If a Minister-level commendation is received, the level of measures based on audit results will be reduced by one stage for the next three years, and penalty surcharges will also be lowered within 10%. Furthermore, the government stated it would prepare tax support measures for outstanding value-up corporations.
A senior official at a domestic corporation that has yet to disclose a value-up plan noted, "As a listed company, we have no choice but to be more sensitive to the potential for a change in government due to the early presidential election in June rather than the incentives presented by the government," and added, "Of course, we will make efforts to return value to shareholders, but there is no internal atmosphere that urges the acceleration of the value-up disclosure."
According to the financial authorities, as of the end of March this year, a total of 131 listed companies participated in value-up disclosures. After the government initiated the value-up program last May to resolve the Korea Discount (the undervaluation of the Korean stock market), only about 5% of all listed companies have cooperated with this policy over the past 10 months. As the date of the early presidential election approaches, concerns are being raised that the value-up policy will inevitably lose momentum.
Recently, not only corporations but also officials from financial authorities are in a state of disorder due to news that the Democratic Party of Korea has established a comprehensive reorganization plan for economic ministries. An official affiliated with the financial authorities remarked, "Both the Financial Commission and the Financial Supervisory Service are included in the opposition's reorganization plan, so nowadays, whenever employees gather, that’s all they discuss."