Last Year, 23,723 KOSDAQ Disclosures in Total... 18.2% Decrease in Non-compliant Disclosure Corporations Compared to Previous Year

Overall Disclosures Up 1.5% YoY... Average Disclosures per Listed Company Down 0.4
Last Year's IPO Market Hits Record High... Disclosures on Operating Fund Expansion and Financial Structure Improvement Also Increase

(Provided by Korea Exchange)

[Asia Economy Reporter Gong Byung-sun] Last year, the total number of disclosures in the KOSDAQ market reached 23,723, marking a 1.5% increase compared to the previous year. This is attributed to the expansion in the number of listed companies as the initial public offering (IPO) market achieved record-breaking performance. Conversely, the number of companies with unfaithful disclosures significantly decreased compared to the previous year.

On the 16th, the Korea Exchange released the “2021 KOSDAQ Market Disclosure Performance” report containing these details. Disclosure types are categorized into timely disclosures, fair disclosures, inquiry disclosures, and voluntary disclosures. Although the total disclosures increased by 1.5% to 23,723, the average number of disclosures per listed company decreased by 0.4 to 15.5 during the same period.

Last year, timely disclosures totaled 19,558, a 2.4% increase from the previous year. Notably, disclosures related to capital increases and decreases rose by 12.1% to 1,357. Disclosures concerning the issuance of stock-related bonds also increased by 6.6%, reaching 1,206.

This growth is due to the IPO market achieving record performance last year, which led to an increase in the number of listed companies. The number of newly listed companies, which was only 108 in 2019 and 103 in 2020, rose to 114 last year. Additionally, disclosures related to capital increases for operational fund expansion and financial structure improvement, as well as disclosures on stock-related bond issuance, increased by 10% and 6.6%, respectively, compared to the previous year. However, disclosures related to treasury stock acquisition and disposal decreased by 26.5% to 737. This decline is analyzed to be due to reduced index volatility last year, leading to fewer disclosures related to treasury stock acquisition.

Fair disclosures last year totaled 1,020, a 3.3% increase from the previous year. With improvements in listed companies’ performance and strengthened investor relations (IR) activities, provisional business performance disclosures and business performance forecasts and predictions increased by 2.1% and 8.3%, respectively, compared to the previous year. To reduce information asymmetry for minority shareholders, fair disclosures related to timely disclosures increased by 17.6% year-on-year.

Inquiry disclosures decreased by 27.5% to 187 compared to the previous year. Due to eased market volatility, inquiry disclosures related to market fluctuations dropped by 35.6% during the same period. Inquiry disclosures related to rumors and reports also decreased by 3.1%.

Voluntary disclosures last year recorded 2,958, a 2.3% decrease from the previous year. Among these, disclosures related to delayed submission of audit reports, which numbered 185 in 2020, decreased to 63 last year. Additionally, disclosures on other management matters decreased by 19.4% compared to the previous year. However, disclosures on capital increases and bond subscription and issuance results increased by 14.7% due to increased corporate fundraising.

(Provided by Korea Exchange)

The number of companies with unfaithful disclosures was 82, with 99 cases reported. This represents an 18.2% decrease compared to 121 cases from 100 companies in 2020. The consulting on disclosure system establishment for small and medium-sized listed companies, which began in the second half of 2020, is believed to have enhanced the disclosure capabilities of KOSDAQ companies and reduced unfaithful disclosures. The number of companies receiving consulting on disclosure system establishment increased significantly from 25 in 2020 to 89 last year.

However, due to the spread of COVID-19, numerous unfaithful disclosures occurred related to contract cancellations and withdrawals following large-scale orders for quarantine supplies. Additionally, unfaithful disclosures related to fundraising, acquisition and disposal decisions of other companies, disclosure reversals and changes, as well as delayed disclosures due to insufficient internal information delivery systems in listed companies leading to lawsuits, were reported.

A Korea Exchange official stated, “We will encourage companies to faithfully fulfill their disclosure obligations by strengthening disclosure education for listed companies in the future, thereby enhancing the credibility of the KOSDAQ market. We will continue to expand consulting on disclosure system establishment targeting newly listed companies with insufficient disclosure systems and small innovative companies with strong intentions for faithful disclosure.”

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