South Korea to submit revised bill aimed at better protecting minority shareholders

SEOUL (Reuters) – South Korea’s financial regulator said on Monday it would work with the ruling party to put forward a revised bill of the Commercial Act this week aimed at better protecting the rights of minority shareholders.

The Financial Services Commission said the government’s proposal seeks to make it mandatory for listed companies to seek external valuation of any mergers or acquisitions, to better protect the rights of minority shareholders against those of controlling shareholders.

The government has been pushing listed companies to voluntarily improve shareholder return and make company boards more accountable to stockholders, as analysts often cite poor corporate governance as one factor behind the local equity market’s underperformance compared to global indexes.