FSC Chairman Meets Listed Companies to Boost Corporate Value-up Program

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FSC Chairman Holds Meeting with Listed Companies to Boost Corporate Value-up Efforts Aug 12, 2024

Chairman Kim Byoung Hwan of the Financial Services Commission held a meeting with a group of listed companies and related organizations to boost their efforts to participate in the Corporate Value-up Program on August 12. Together with related organizations, Chairman Kim said that the FSC will provide active support to promote companies’ self-driven efforts to participate in the Corporate Value-up Program.

Today’s meeting was joined by three companies (Kiwoom Securities Co., Meritz Financial Group Inc., and HK inno.N Corp.) that have already filed a voluntary disclosure or issued a prior notice of disclosure for their value-up plans and five other listed companies. Key officials from the Korea Exchange, Korea Listed Companies Association, KOSDAQ Listed Companies Association, Korea Financial Investment Association, and the value-up program’s advisory group also attended the meeting.

The following is a summary of FSC Chairman Kim’s remarks at the meeting.

Regarding last week’s stock market volatility, the financial authorities are well aware of the concern about the relatively large fall experienced by our stock market and the slow pace of its recovery. In order to make our stock market more robust and resilient, it is important to boost participation in the Corporate Value-up Program, so that we can enhance the competitiveness of listed firms and the stock market.

Moreover, making improvements to our capital market through the Corporate Value-up Program is also important from the perspective of seeking to transform our economic structure from the current debt-reliant model to an equity-centered approach. Making improvements to the current debt-dependent structure of our economy will help to make our economy more dynamic, enhance stability, and contribute to sustainable growth.

Since introducing the outline of support measures for the Corporate Value-up Program in February this year, the government has worked to swiftly implement follow-up measures. The authorities will continue to work for a seamless implementation of the remaining tasks, such as the introduction of a Korea value-up index in September and exchanged traded funds (ETFs) in the fourth quarter of this year.

With regard to tax support for the Corporate Value-up Program, the government’s tax revision bill announced on July 25 contains provisions on abolishing financial investment income tax and other supportive measures for corporate tax, dividend income tax, and inheritance tax that are designed to benefit companies disclosing their value-up plans and boosting shareholder returns. Going forward, the FSC will provide active support for parliamentary discussions to make sure that these support measures can take effect as planned.

In addition, under the recognition that it is necessary to spread the culture of prioritizing shareholder values, the FSC is currently in discussions with related organizations about the appropriate direction to revise the Commercial Act. After gathering sufficient comments from various stakeholders, the government will arrive at a final revision draft.

Successful implementation of the Corporate Value-up Program will require self-driven and active efforts by market participants. The early efforts shown by those that have already disclosed or filed a prior notice of disclosure for their value-up plans are much appreciated. Other listed companies are highly encouraged to follow suit. In this regard, the financial investment industry is strongly urged to play its role not only in actively participating in the Corporate Value-up Program but also in helping to create a virtuous cycle where capital flows in the market can feed into companies’ value-up efforts.

• Please refer to the attached PDF for details.

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