Approval Rate '99%'... Financial Public Enterprise Boards Reduced to Rubber Stamps

Eight Financial Public Institutions Held 71 Board Meetings This Year
218 of 219 Agenda Items Approved... Automatic Approval if Submitted
Agenda Explanations, Director Remarks, and Voting Results Sometimes Omitted from Disclosure

[Asia Economy Reporter Song Seung-seop] This year, the approval rate of agenda items at the boards of directors of financial public institutions was found to be close to 100%. The disclosure methods varied by institution, and there were numerous cases where substantial information was omitted. While financial authorities have criticized private financial companies for turning boards of directors?who are supposed to monitor and control management?into mere rubber stamps, there is criticism that their management and supervision of the boards of affiliated institutions have been inadequate.

According to the Public Institution Management Information System (ALIO) on the 29th, eight financial public institutions (Seomin Geumyung Jinheungwon, Credit Guarantee Fund, Korea Deposit Insurance Corporation, IBK Industrial Bank of Korea, KDB Industrial Bank, Korea Securities Depository, Korea Asset Management Corporation, and Korea Housing Finance Corporation) held a total of 71 board meetings this year. A total of 219 agenda items were submitted to the boards, of which 218 were approved, resulting in an approval rate of 99.5%.

There were only five cases where agenda items were amended after discussions among directors. The majority of agenda items were approved as originally proposed. The only agenda item that was rejected was the “Asian Development Bank (ADB) Trust Fund Loan Proposal” discussed by the Korea Securities Depository board in July.

Omission of Speeches and Voting Results... Some Cases Handled Confidentially Without Explanation

The institution that processed the most agenda items was Seogeumwon. It passed 52 items over 10 board meetings this year, with a 100% approval rate. Its disclosures were also sloppy. Six agenda items handled at a recent board meeting had all detailed discussion processes omitted from the minutes. These included “Partial Amendments to the Articles of Incorporation” and “Partial Amendments to the Work Procedures,” but no explanations were provided about which clauses were changed or how.

Many institutions did not disclose whether agenda items were approved or opposed. Typically, private financial holding companies indicate each director’s area of expertise and their vote on each agenda item. However, among financial public institutions, only Seogeumwon and Jugeumgong partially disclosed voting results in some minutes. Even then, they operated poorly by only disclosing when all directors agreed or later removing the voting result fields altogether.

There were also many cases where participants’ remarks were disclosed opaquely. IBK Industrial Bank of Korea summarized remarks made at board meetings in brief. Even these summaries were not detailed. For all 39 agenda items processed this year, the remarks were simply recorded as “agree with the agenda.” The Korea Deposit Insurance Corporation also created a “Main Discussion Points” section but marked board members as “000,” making it impossible to identify speakers. KDB Industrial Bank kept a significant number of voting and reporting agenda items confidential. Although current regulations do not require disclosure of meeting contents, not revealing the agenda items or reasons for confidentiality is far from transparent information disclosure.

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