Korea ESG Institute Recommends Support for Korea Zinc's 'Cumulative Voting System' and 'Board Size Limit'

The Korea ESG Institute has recommended investors to support all proposals put forward by the current management of Korea Zinc at the upcoming extraordinary general meeting of shareholders on the 23rd, including the 'cumulative voting system' and the 'limit on the number of directors.'

On the 15th, the Korea ESG Institute released the 'Korea Zinc Extraordinary General Meeting Agenda Analysis Report' and recommended full support for all agenda items proposed by the board, including ▲introduction of the cumulative voting system ▲limit on the number of directors ▲introduction of the executive officer system ▲stock par value split.

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First, the Korea ESG Institute expressed support for the amendment to the articles of incorporation regarding the 'limit on the number of directors,' explaining that "having an appropriate number of board members enables efficient and responsible decision-making, which aligns with the enhancement of long-term shareholder value." It also added, "No concerns about shareholder value deterioration due to the amendment to the articles of incorporation were found."

Regarding one of the key agenda items, the cumulative voting system, the institute also recommended support. The Korea ESG Institute stated, "The introduction of the cumulative voting system in a management dispute situation will give ordinary shareholders a casting vote role," adding, "It is positively evaluated in that it can ultimately contribute to protecting the rights and interests of ordinary shareholders."

Concerning board composition, the institute supported the four outside director candidates recommended by Korea Zinc and advised that it would be appropriate for three candidates, including Kang Sung-doo, President of Youngpoong, recommended by Youngpoong and MBK, to join the board.

The Korea ESG Institute stated, “Considering the management performance of Korea Zinc’s management so far and the shareholder-friendly policies previously established, it is recommended to continuously pursue these policies from the perspective of management stability, while also appointing some director candidates from Youngpoong and MBK who can sharply supervise and check the management.”

Earlier, Glass Lewis, one of the two major global proxy advisory firms, recommended opposing all directors nominated by MBK and Youngpoong, while supporting all proposals put forward by the current management. ISS also recommended minimizing new director entries to four.

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