¡¸?????? ?????¡¹? ?? ??? ?? (A Comprehensive Review of Amendments to ¡¸Korean Commercial Code on Corporate Governance¡¹)

Since the global financial crisis there has been mounting interest in desirable corporate governance worldwide and the need to improve the system to enhance management transparency has been raised in Korea as well. Given this, the Ministry of Justice preannounced a partial amendment to the Korean Commercial Code on corporate governance. In accordance with the Ministry, the amendment is aimed at improving the procedure for appointing board of directors and audit committee members, organizing the function and role of the board of directors, expanding legal remedies against the illicit acts of executives, and invigorating a general meeting of shareholders in order to lay a legal framework to lead a transparent and sound management and corporate culture.
The amendment mainly covers the issues including ¢Ù introducing a multiple derivative suit system, ¢Ú strengthening the supervisory functions of the board of directors (introducing executive officer system) ¢Û making the concentrated vote system mandatory by stages, ¢Ü introducing a separate election system of audit committee members, and ¢Ý making electronic voting compulsory by stages.
These measures will help enhance transparency in corporate governance and realize economic democratization, but may bring about problems and side effects if corporations are obliged to follow them. Thus, the Ministry should take a careful approach to implement them.
In a nutshell, the Korean Commercial Code is not the law to monitor or suffocate corporations, but a fundamental belief needed to facilitate business activities and sustain and develop corporations. Against this backdrop, legislation should be enacted not to aggravate a burden on corporations and rather in a way to alleviate it. The public has not been approving of a chaebol owner who was recently indicted of inadequate management practices. However, considering the current economic conditions at home and abroad, the Code should place an emphasis on 'an entrepreneurial spirit' to help businesses make large scale investments leading to reviving the economy. Not a single country in the world has been applying an uniform corporate governance and it is not desirable to reignite controversy only a year after the corporation law was amended through heated debates.

Since the global financial crisis there has been mounting interest in desirable corporate governance worldwide and the need to improve the system to enhance management transparency has been raised in Korea as well. Given this, the Ministry of Justice preannounced a partial amendment to the Korean Commercial Code on corporate governance. In accordance with the Ministry, the amendment is aimed at improving the procedure for appointing board of directors and audit committee members, organizing the function and role of the board of directors, expanding legal remedies against the illicit acts of executives, and invigorating a general meeting of shareholders in order to lay a legal framework to lead a transparent and sound management and corporate culture.
The amendment mainly covers the issues including ¢Ù introducing a multiple derivative suit system, ¢Ú strengthening the supervisory functions of the board of directors (introducing executive officer system) ¢Û making the concentrated vote system mandatory by stages, ¢Ü introducing a separate election system of audit committee members, and ¢Ý making electronic voting compulsory by stages.
These measures will help enhance transparency in corporate governance and realize economic democratization, but may bring about problems and side effects if corporations are obliged to follow them. Thus, the Ministry should take a careful approach to implement them.
In a nutshell, the Korean Commercial Code is not the law to monitor or suffocate corporations, but a fundamental belief needed to facilitate business activities and sustain and develop corporations. Against this backdrop, legislation should be enacted not to aggravate a burden on corporations and rather in a way to alleviate it. The public has not been approving of a chaebol owner who was recently indicted of inadequate management practices. However, considering the current economic conditions at home and abroad, the Code should place an emphasis on 'an entrepreneurial spirit' to help businesses make large scale investments leading to reviving the economy. Not a single country in the world has been applying an uniform corporate governance and it is not desirable to reignite controversy only a year after the corporation law was amended through heated debates.