6 out of 10 Donghak Ants Say "Profit Sharing System Infringes on Shareholders' Property Rights"

[Asia Economy Reporter Suyeon Woo] Among individual investors who are shareholders of domestic companies, 6 out of 10 believe that the profit-sharing system constitutes an infringement on shareholder property rights. Nearly half of the individual shareholders expressed their intention to consider collective lawsuits if the profit-sharing system leads to a decrease in corporate profits, stock price drops, or dividend reductions.

On the 7th, the Federation of Korean Industries conducted a survey on the profit-sharing system through the market research firm Monoresearch. The survey targeted 500 men and women aged 18 and older who currently hold corporate stocks. According to the results, 63.6% of respondents answered that if the profit-sharing system is implemented, shareholder property rights could be infringed due to corporate profit decreases, stock price drops, and dividend reductions.

When asked about their willingness to participate in collective lawsuits if corporate profits decrease and stock prices and dividends fall due to the implementation of the profit-sharing system, 47.2% of respondents said they were willing to participate in such lawsuits.

Survey on Individual Shareholders' Perceptions of the Profit-Sharing System / Data=Federation of Korean Industries

More than half of respondents (51.6%) disagreed with the profit-sharing system that shares a portion of corporate profits with groups affected by COVID-19. The reasons for disagreement with the profit-sharing system were as follows: ▲ weakening of corporate growth drivers such as investment due to decreased corporate profits (26.4%) ▲ infringement on shareholder property rights such as dividend reductions (23.6%) ▲ lack of relevance between companies and affected groups (22.1%) ▲ reverse discrimination against foreign companies (14.3%) ▲ inability to calculate only profits related to COVID-19 (13.6%).

On the other hand, respondents who agreed with profit-sharing with COVID-19 affected groups (42.6%) cited reasons such as ▲ contribution to resolving polarization (32.9%) ▲ need to share the pain caused by COVID-19 (30.5%) ▲ serious crisis of vulnerable groups (26.3%) ▲ clear special benefits for some companies due to COVID-19 (6.1%) ▲ reduction of government fiscal burden (4.2%).

Regarding the fund formation, which is proposed as a promising method for the profit-sharing system, more than half of respondents (51.6%) disagreed. The proportion of respondents agreeing to fund formation was 41%. Additionally, concerns were raised that the profit-sharing system discussions could lead to mandatory participation by companies. 48% of respondents answered that the profit-sharing system is close to a mandatory participation requirement for companies, while only 36.4% said it is close to voluntary participation.

This content was produced with the assistance of AI translation services.