2026 South Korea Season Review

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• Reform entered the market through the Articles of Incorporation. Issuers aligned governance structures with enacted and anticipated reforms, and constitutional amendments became the primary mechanism for implementing governance change at scale. AOI amendments more than doubled year-on-year.
• Investors moved ahead of implementation. Even before many reforms became operative, investors assessed them through the lens of effectiveness. The introduction of cumulative voting shifted scrutiny toward the surrounding architecture — board size, director terms and committee design — that determines whether minority-shareholder rights work in practice.
• Contestability moved upstream. Both management and shareholders increasingly targeted constitutional design and board architecture rather than individual board seats. Shareholder charter amendments rose from 37 to 64, while director-election proposals fell — activism relocated from who sits on boards to the rules that govern them.
• Governance design converged; stewardship stayed differentiated. Reform standardised the framework, but investor judgement remained sharpest at the point of implementation. Management constitutional amendments passed at 98 percent; shareholder constitutional amendments at under 5 percent — support was strongest where reform was operationalised, not merely adopted.
• From reform adoption and implementation to reform effectiveness. The 2026 season was primarily about adoption and implementation; the next phase will be about effectiveness. Investors will increasingly judge reforms by outcomes rather than mechanisms — board accountability, minority representation, audit committee effectiveness, capital stewardship and practical contestability.

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