Park Yu-gyeong, former head (Deputy Minister) of emerging markets equities at Netherlands pension asset manager APG, a global public pension manager who once met one-on-one with Chair Lee Jae-yong over Samsung's governance reform plans, has been nominated as an independent director candidate at Korea Zinc. After leaving APG last year, she chose a listed-company independent directorship as her first move in Korea.
In the past, Park was called the watchdog of governance in Korea's capital market. As the Asia-Pacific head of responsible investment at one of the world's top 10 public pension managers running 980 trillion won, she personally visited the shareholders' meeting hall when Samsung C&T and Cheil Industries pursued a merger and asked, "Are you listening to shareholders' concerns?"
Later, during the 2023 trial over the "Samsung C&T–Cheil Industries allegedly unfair merger," Park drew attention by appearing as a witness. It became known that then–Vice Chair Lee Jae-yong of Samsung Electronics had personally contacted APG to improve the group's governance structure and strengthen shareholder communications. In court, she testified about the lack of transparency in the merger process.
She also carried out Korea's first shareholder proposal on safety management against HDC Hyundai Development Company, leading to changes in the articles of incorporation. KB Financial Group's holding a governance roundtable each year so that the board meets shareholders directly also stemmed from Park's raising concerns that the board was not functioning properly.
Park is now listed as an independent director candidate who would serve as a separately elected audit committee member at Korea Zinc. After leaving APG last year, Park said, "I wanted to know how a board actually operates," and moved to the board of Singapore's Tara Climate Foundation. She also serves as chairperson of Tara Climate Foundation's audit committee.
Young Poong and MBK earlier proceeded with the candidate selection process by taking public nominations from shareholders in June. After verification by an independent external screening body, they finalized Park as the nominee. Her credentials as a governance expert active in responsible investment and governance were highly valued.
Saying, "I became a candidate through a shareholder proposal by Young Poong and MBK, but I am going in as an independent director," and "The phrase 'independent director of Young Poong and MBK' is a contradiction in terms. I will stand on the side of all shareholders," Park was interviewed at a location in Seoul on the 12th to ask why she intends to join the board of a company in the midst of a control fight and what her resolve is.
She said, "During 17 years at APG as head of responsible investment and as Deputy Minister of the emerging markets equities division, I only coached from the sidelines and never did it directly," and added, "I wanted to know what difficulties exist on corporate boards and whether there is something I can contribute." She continued, "I will faithfully carry out the basic role of an independent director as set out in the Commercial Act."
Korea Zinc's board, where Chair Choi's side holds the advantage, recommended Dankook University Professor Baek In-gyu as a separately elected audit committee candidate. A vote showdown is set for the extraordinary shareholders' meeting on the 9th of next month. Because the voting rights of the largest shareholder's side are capped at 3% for separately elected audit committee members, the National Pension Service and foreign shareholders are seen as swing factors.
The following is a Q&A with Park.
—You were a Korea Zinc shareholder back when you were at APG. What did you point out at the time?
"We held a sizable equity stake and kept communicating with the IR team. We demanded two principles. First, as a listed company, are you making decisions that align with the interests of all shareholders? Second, are you treating all shareholders equally? The company gave only textbook answers, and I doubted the role of the board."
—What do you see as the role of the board?
"The board's significance lies largely in filtering the company's decisions through the eyes of shareholders. Above all, it is tasked with monitoring and checking the decisions of the company's controlling shareholders and management. In Korea, boards are often regarded not as monitoring and checking bodies but as advisory bodies or a kind of insurance, and that is completely wrong."
—During Korea Zinc's control battle, issues such as a tender offer for treasury shares and a paid-in capital increase erupted.
"I remember. At the time I asked, 'Why make such a decision?' Because capital decisions affect every single shareholder, they must be discussed in depth and made with care. I asked what management's thinking was and what the board's decision process had been, but no clear answer came back.
"A capital decision that cannot be understood should have been blocked by the board. The good thing about having a board is that it filters decisions once through the eyes of the market and shareholders, and I wondered whether such eyes existed. A company's competitiveness includes not just technology and market share but also whether the market sees it as trustworthy."
—The control fight later spread to cross-shareholdings and attracting investment from the U.S. government.
"First, the cross-shareholding issue must be addressed. Putting aside cross-shareholdings using subsidiaries, I believe the bigger problem now is Korea Zinc's cross-shareholdings with other corporations. In particular, cross-shareholdings with other corporations using treasury shares will, as in Japan in the past, lead to the collapse of the capital market itself."
—What do you mean that cross-shareholdings collapse the capital market?
"In Japan, there was a time when over 50% of Toyota's shares were, at one point, all cross-held. It starts small. When you sit down to do business, you say, 'I trust you and you trust me, so let's exchange a few shares,' and you enter into a cross-shareholding. Then you go on to establish cross-shareholdings with the next business partner as well.
"The result of cross-shareholding is inevitably market indifference. A company solidified by cross-shareholdings does not need IR. It also stops returning profits to shareholders. The very reason for Japan's capital market stagnation was cross-shareholdings. The recent rise in Japan's stock market is thanks to policies unwinding cross-shareholdings, yet Korea still bands together like blood allies."
—How do you view the friendly corporations that joined the defense of Korea Zinc?
"We need to consider whether it is desirable to be dragged into another group's control war by taking an equity stake. Isn't that capital being tied up in a control fight? The shareholders of the corporation in question should first raise the issue by asking, 'What is the return on this capital?' Korea Zinc's board should have taken it very seriously as well."
—Your opponent (Baek In-gyu) is an accountant with 30 years of experience. Isn't it a disadvantage if you look only at expertise?
"My strength is that over the past 17 years I have thought about the crux of Korea's governance problems—what the most fundamental issues are. When a project or agenda item is discussed at the board, I can quickly identify what the issues are. I can fix the problems we have worked on more efficiently from the perspective of ordinary shareholders."
—On the shareholders' meeting agenda, you are listed as a shareholder-proposed candidate from Young Poong and MBK. To ordinary shareholders, you may appear as 'a candidate from one camp.'
"That is a very sad question. A shareholder proposal is when a shareholder with a certain equity stake tells the board, 'This person is excellent, so we recommend them.' Whether the company is Samsung Electronics or Hyundai Motor, the person recommended enters as an independent director wherever they go. The very phrase 'independent director from some side' is a contradiction in terms.
"When I was told I had been selected, I first asked, 'I will faithfully play the role of an independent director becoming an audit committee member regardless of MBK and Young Poong—are you still okay with that?' If you do not intend to do that, you should not go in with the title of independent director. Without that resolve, I would never have started."
—How do you see Korea Zinc's investment in a U.S. joint venture (JV)?
"The company presented the U.S. joint venture project as a business that creates future value. However, it remains in question whether the board conducted thorough verification of 'why, why now, and why via a JV.' And above all, independent directors must be able to explain those reasons to shareholders. That is very basic."
—Do you mean that independent directors on the board should be able to explain matters to shareholders?
"KB Financial Group is a good example. I participated as a shareholder during the so-called 'KB crisis.' Back then in finance, every time administrations changed, transition team figures would repeatedly take the chair of a listed financial holding company like war spoils. It was an ownerless, dispersed-ownership corporation, and the board swayed to outside pressure without vetting appointments.
"One of the results we achieved then was the 'governance roundtable.' Once a year, shareholders, management, and the board gather in one place to talk directly about the company's key decisions and governance issues. In particular, the board explains directly to shareholders what discussions it had and also takes questions."
—What would be the first thing you do if you join Korea Zinc's board?
"As a capable independent director, I intend to carry out the basics written in the Commercial Act—monitoring and checking. An independent director on the board is not an adviser appointed by controlling shareholders or management, but the person who asks whether decisions are fair to all shareholders. Investors naturally believe such duties will be fulfilled and pay compensation on that basis.
"When I meet independent directors one by one, many think the company pays them. No. Shareholders forgo what should rightfully go to net profit to appoint independent directors and to structure the board. It is shareholders' money, and above all, it is money given with duties and responsibilities."
—Even if you become an audit committee member, you will inevitably be in the minority on the audit committee.
"I think the priority is to keep saying 'no means no,' to oppose, and to leave a record. The business report records 'which director opposed which agenda item.' I definitely want to leave such records. Still, isn't that better than having zero? You need one step for the next to follow."
—How do you think this dispute should end?
"I hope the controlling shareholders grow through this fight. Not by winning and pushing everyone out, but with both sides thinking, 'We made this mistake this time, so we should not do that next time.' I want Young Poong, MBK, and Korea Zinc to compete while walking the right path and to end up in a better place than now."