The number of listed companies required to disclose in English will jump sharply from the current 111 to 265. The timeline for making English disclosures mandatory for all KOSPI-listed companies has also been moved up to Mar. next year.
On the 28th, the Korea Exchange (KRX) said amendments to the Regulation on Issuance and Disclosure of securities and the Disclosure Regulations for the KRX Main Market, KOSDAQ Market, and KONEX Market, reflecting measures to improve corporate disclosures, were approved by the Financial Services Commission on the day.
The amendments include expanding English disclosures to improve global investors' access to the capital market and enhance the rights and interests of ordinary shareholders, as well as disclosing the results of shareholder meeting votes.
The Financial Services Commission and the exchange have been pushing to expand English disclosures by listed corporations as part of efforts to enhance the global appeal of Korea's capital market.
With this measure, the number of listed companies subject to mandatory English disclosure will rise sharply from 111 in phase one to 265 in phase two. In phase one, implemented in 2024, companies subject to the rule were those with "assets of 10 trillion won or more and a foreign ownership ratio of 5% or more" or "assets of 2 trillion won or more and a foreign ownership ratio of 30% or more." Starting in May, with phase two, all KOSPI-listed companies with assets of 2 trillion won or more will be subject to the rule.
The disclosure items will also increase. In addition to shareholder meeting results, all 55 key management items related to business and investment activities, fair disclosures, and inquiry disclosures must be disclosed in English.
The disclosure deadline for KOSPI-listed companies with assets of 10 trillion won or more will, in principle, be shortened from "within three business days after submitting the Korean-language disclosure" to the same day.
In addition, the timeline for making English disclosures mandatory for all KOSPI-listed companies in phase three will be moved up. Originally scheduled for May 2028, it will be advanced to Mar. 2027 for early implementation. The number of listed companies subject to the rule will increase to 848.
The exchange said it will continue efforts to strengthen listed companies' English disclosure capabilities by expanding translation support services, publishing and distributing an English disclosure glossary, and enhancing regular training to ensure a smooth rollout of the system.
Starting in Mar., disclosure of shareholder meeting vote results, including the approval rate by agenda item, will also be mandatory.
Previously, only whether each agenda item at the shareholder meeting passed was disclosed. With this regulatory revision, the vote results by agenda item, including the percentages in favor, against, and abstaining, will be disclosed on the day of the shareholder meeting.
In addition, regular reports such as business reports will include detailed vote results by agenda item for shareholder meetings held during the disclosure period.
Compensation for executives at listed companies will also be disclosed more transparently. Currently, executive compensation disclosures do not reveal the relationship between corporate performance and pay, and the disclosure of the basis for calculating compensation is insufficient, leading to views that they are less specific than executive compensation disclosures in major overseas countries such as the United States.
Accordingly, the executive compensation disclosure items will include, alongside the total compensation for all executives, the total shareholder return and operating profit for the past three years. The reasons for granting each detailed compensation item and the calculation criteria will also be disclosed in more specific terms.
Moreover, previously, stock-based awards (RSU) for executives were disclosed separately from executive compensation, making it difficult for shareholders to accurately gauge the size of compensation for executives. Going forward, restricted stock and similar awards must be disclosed together with the total compensation for all executives and the detailed compensation status for each individual, and the cash-equivalent value of unrealized stock-based compensation must also be presented.
The revised regulations are scheduled to take effect in Mar.