Korea's Corporate Value-up Program has officially begun to spread its roots into the KOSDAQ market, marking a significant new chapter for the ambitious initiative.
The Korea Exchange (KRX) recently confirmed that participation in the program has reached 177 companies, with a notable 46 firms hailing from the KOSDAQ. This expansion is crucial, as it demonstrates the program's appeal beyond the large-cap giants of the KOSPI, showing it is gaining traction among the growth-oriented and tech-focused companies that define the junior board.
So, what's driving this momentum? A confluence of three powerful forces is at play. First, there are the direct policy incentives. A recently confirmed rule now mandates that high-dividend companies submit value-up plans, directly linking the program to tangible tax benefits. Simultaneously, the KRX has eased its guidelines, allowing companies to present qualitative goals if quantitative ones are difficult to set. This revision has significantly lowered the barrier to entry for many KOSDAQ firms.
Second, strong market signals are providing a compelling reason to join. The 'Korea Value-up Index' has dramatically outperformed the broader KOSPI since its launch (+134.9% vs. +101.5%), and related ETFs have attracted a massive 1.7 trillion won in net assets. This performance sends a clear message to corporate boards: the market rewards companies that commit to enhancing shareholder value.
Finally, a rising tide of governance pressure is pushing companies toward greater transparency. Measures like expanded English disclosure requirements and mandatory detailed reporting of shareholder meeting votes are empowering investors. Furthermore, influential institutions like the National Pension Service (NPS) are intensifying their oversight by pre-disclosing voting intentions for companies in which they hold significant stakes. This combination of policy, market, and governance drivers is creating a virtuous cycle, encouraging more companies, especially from the KOSDAQ, to embrace the value-up initiative.
- Corporate Value-up Program: A government-led initiative in South Korea designed to encourage listed companies to improve corporate governance, enhance shareholder returns, and ultimately resolve the 'Korea Discount,' where Korean stocks are often valued lower than their global peers.
- Stewardship Code: A set of principles or guidelines aimed at institutional investors, encouraging them to actively engage with the companies they invest in to promote long-term value creation. This includes exercising voting rights and monitoring corporate governance.