The Financial Services Commission approved revised rules on corporate disclosures at the regular meeting held on January 28. The rule changes are aimed at expanding the scope of listed companies being subject to the mandatory English disclosure requirement and making corporate disclosure practices more transparent regarding annual general meetings of shareholders (AGMs) and executive compensations.
Key Revision Details
a) Expanding mandatory English disclosure requirement (from May 2026)
The FSC and the Korea Exchange (KRX) have been working on expanding the application of mandatory English disclosure requirement on listed companies in stages. In this regard, the mandatory English disclosure requirement entered into the first stage in January 2024 for listed companies with assets worth KRW10 trillion or more (and foreign ownership of 5 percent or more) or those with assets worth KRW2 trillion or more (and foreign ownership of 30 percent or more). Under the revised rules, the mandatory English disclosure requirement will be expanded to all KOSPI-listed companies with assets worth KRW2 trillion or more from May 2026.
This will significantly increase the number of listed companies being subject to the mandatory English disclosure requirement from the current level of 111 companies (based on their total assets as of end-2024) to 265 companies.
The disclosure items subject to the mandatory English disclosure will also be expanded to all disclosure items required by KRX rules, including material information in its entirety (55 items), fair disclosure, and inquired disclosure. The time required for companies to submit English disclosures after filing their original Korean disclosures will also be reduced. Large KOSPI-listed companies with assets worth KRW10 trillion or more will need to submit English disclosures on the same day of filing their Korean disclosures with the KRX in principle. Listed companies with assets worth KRW2 trillion or more that are newly becoming subject to the mandatory English disclosure requirement will need to submit English disclosures within three days from the time of filing their original Korean disclosures.
In addition, considering the status of KOSPI market as Korea’s main board and significant interest shown by global investors, the previously planned third-stage expansion (from May 2028) of the mandatory English disclosure requirement to all KOSPI-listed companies will be sought earlier (from March 2027) than the initial schedule. The third-stage expansion will make 848 companies subject to the mandatory English disclosure requirement.
At the same time, there will be continuous efforts to help strengthen the capacity of listed companies for handling English disclosures by expanding KRX’s translation assistance service, providing a glossary on English disclosure, and enhancing periodic training programs.
b) Enhancing disclosure on AGM voting results (from March 2026)
To help make AGMs more transparent and enhance regulatory consistency with global standards, from March 2026, companies will be required to disclose information about AGM voting results (% of votes in assent, etc.) by agenda item.
Previously, the disclosure of information regarding AGM results merely revealed information about whether an agenda has been approved or not. However, with the revised rules in place, companies will be required to disclose voting results (% of votes in assent, dissent, and abstention) by agenda item on the day of holding AGMs, and also disclose the voting results (% of votes in assent, dissent, and abstention, plus total shares in assent, dissent, and abstention) through periodic disclosure of business report.
c) Improving disclosure on executive compensations (from May 2026)
The revised rules will also improve the transparency of information disclosure regarding executive compensations of listed companies, which will make it possible for ordinary shareholders to gain better understanding about executive compensation practices of listed companies. Under the current system, it has been pointed out that the disclosure of information on executive compensations does not necessarily reveal a relationship between business performance and executive compensation, and that there has been insufficient information about the details of how executive compensations are being calculated.
In this regard, the revised rules will require companies to write side-by-side their total shareholder return (TSR) and operating profit for the most recent three years on the total executive compensation disclosure form to facilitate shareholders to more easily find out about the business performance and executive compensation of companies. In addition, for each specific compensation category (salary, bonus, stock option, stock-based compensation other than stock option, retirement income, etc.), companies will need to disclose detailed information providing a rationale and justification for their compensation decisions.
Additionally, under the current system, stock-based compensations in the form of restricted stock units (RSUs) and so on are being disclosed separately from executive compensations, and they are not included in the disclosure form showing details of compensation categories for each executive officer. Thus, it has been difficult for ordinary shareholders to clearly understand the actual size of executive compensations including stock-based compensations (RSUs, RSAs, etc.).
In this regard, the revised rules will require companies to disclose every type of stock-based compensation on the total and individual executive compensation form and write side-by-side the cash value of unfulfilled stock-based compensations.
Further Plan
The revised rules are scheduled to take effect from March 2026. However, the rule changes expanding the application of the mandatory English disclosure requirement and strengthening the disclosure of executive compensations will take effect from May 2026.
With the upgraded disclosure rules in place, it is expected that overseas investors will be able to experience enhanced market accessibility to Korean capital markets and that ordinary shareholders will be able to more readily exercise their shareholder rights based on a more timely provision of information about AGM voting results and executive compensations.
* Please refer to the attached PDF for details.