This year, it was found that shareholder proposals closely linked to corporate management, including changes to the articles of incorporation, have significantly increased at the regular general meeting of shareholders. However, there were also concerns that such proposals are being undermined due to the defensive responses from management.
The CHA Economic Research Institute noted this in a report titled '2025 Regular General Meeting Review' published on the 29th.
As a result of analyzing the agenda items of 801 listed companies that held regular general meetings this year, the number of shareholder proposals totaled 168, a 9.1% increase compared to last year. Looking at the trends over the past five years, the number of companies submitting shareholder proposals has increased by 65.4% compared to 2021, and the number of shareholder proposals during the same period has increased by 82.6%.
Examining the types of the 168 shareholder proposals this year, there were 78 regarding the election and dismissal of executives, 50 for amendments to the articles of incorporation, 23 for shareholder returns, 2 for executive compensation limits, and 15 for others. Compared to last year's general meeting, the number of passive shareholder proposals, such as those for shareholder returns, did not change significantly, but proposals for amendments to the articles of incorporation (28 last year) and others (7 last year) have surged by about twofold, indicating a substantial increase in shareholder proposals closely related to corporate management.
In particular, four companies submitted agenda items to amend the articles of incorporation to allow for 'advisory shareholder proposals' to be discussed at the general meetings. Regarding advisory shareholder proposals, the CHA Economic Research Institute stated, "This system strengthens shareholder rights by allowing the management to hear directly from shareholders and to decide on acceptance based on management judgment principles according to the circumstances, while also contributing to the efficiency of management," and recommended support for it.
Additionally, eight corporations submitted agenda items for the introduction of cumulative voting systems that are friendly to minority shareholders, but the CHA Economic Research Institute noted that some companies, such as Oscotec, KT&G, and Coway, undermined the cumulative voting system by distinguishing the targets for cumulative voting. Companies like CHA Biotech and YoulChon Chemical also submitted items to undermine shareholder proposals by adjusting the number of directors or introducing audit committees.
The research institute commented, "It is a reality that controlling shareholders or existing management submit defensive agenda items to respond to shareholder proposals, thereby restricting and defending against minority shareholders," and added that "To maximize shareholder value through the establishment of a sound governance structure and transparent and efficient management, it is necessary to actively ensure the exercise of shareholder rights by minority shareholders and to provide institutional support along with a change in the attitude of management so that various opinions and claims are conveyed to the board of directors and management and reflected."