"Institutional Investors Expand Shareholder Proposals at Listed Companies' General Meetings This Year"

This year, at the regular general shareholders' meetings of listed companies in Korea, institutional investors played a leading role, going beyond being mere participants in voting to actively setting agendas, according to analysis.

According to the '2026 Regular General Shareholders' Meeting Review' report published on April 28 by Ajou Corporate Management Institute, the main drivers behind shareholder proposals have shifted from individual and small shareholders' alliances to institutional investors. Furthermore, the content of proposals has also evolved, moving beyond simple shareholder return requests to cover areas closely related to corporate governance such as the appointment and dismissal of executives, amendments to the articles of incorporation, and executive compensation systems. Ajou Corporate Management Institute evaluated that "one of the biggest changes observed at this year’s regular shareholders’ meetings is not only the quantitative increase in shareholder proposals but also a shift toward institutional investors, away from individuals and small shareholder alliances, as the primary proposers."

According to the institute, during the regular shareholders’ meetings held from February to March this year, the number of shareholder proposals by listed companies reached 206, of which 61 (29.6%) were submitted by institutional investors. This marks a significant increase compared to last year (2 proposals) and 2024 (21 proposals). The overall number of shareholder proposals also rose by approximately 23% from last year’s 167.

The institute cited ongoing discussions about amendments to the Commercial Act and the Stewardship Code (principles regarding the fiduciary responsibility of institutional investors) as the main causes of this shift. As the environment for institutional investors to exercise their shareholder rights has improved, institutions with scale, organizational power, and access to information have begun directly proposing strategic agenda items that are likely to gain support and be approved by other investors.

In fact, this year’s shareholder proposals showed a high proportion of agenda items directly related to corporate governance. In particular, proposals concerning director remuneration limits and overall compensation structures jumped from 3 last year to 17 this year. The institute pointed out, "This is due to institutional investors and proxy advisory firms beginning to evaluate director remuneration limits-including their size, calculation rationale, and discrepancies with actual payouts-more rigorously," adding, "The issue of director remuneration limits is emerging as a key topic for scrutiny in corporate governance."

Additionally, it noted, "Following the Supreme Court’s ruling in 2025, the right to vote of special interested parties on remuneration limit agenda items has been strictly restricted, increasing the uncertainty of proposal approvals and expanding the necessity for companies to manage such risks."

The report further stated, "In response, companies are adopting various strategies to address the risk of compensation gaps, such as submitting remuneration limit agenda items for each individual director to ease voting restrictions by agenda item, or establishing new executive compensation payment regulations to provide a clear basis for payment."

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