Lee Chan-jin, Governor of South Korea's Financial Supervisory Service (FSS), held a meeting with chief executives of 20 asset management firms to discuss the results of the '2026 Asset Management Company Voting Rights and Shareholder Rights Exercise System Inspection' and practices related to exchange-traded funds (ETFs). Lee called for rigorous self-correction efforts from the industry, stating that false and exaggerated ETF advertising and product 'copying' practices undermine investor trust. He also pointed out that so-called 'copy-paste' voting rights disclosure practices persist, urging firms to substantively overhaul related policies and disclosure systems. The meeting addressed inspection findings showing that 121 out of 285 firms (42.4%) used formulaic justifications in over half of their voting rights exercises, alongside ongoing concerns about weak internal controls in shareholder rights activities.
FSS Reports Rising Shareholder Rights Exercise Rates in 2026 Inspection
According to the FSS survey, shareholder rights exercise rates and opposition rates for public and private fund asset managers were 79.6% and 5.2% in 2024, 91.6% and 6.8% in 2025, and 91.8% and 8.2% in 2026. The number of public asset management companies equipped with dedicated organizations, fiduciary responsibility committees, and key performance indicators (KPIs) increased compared to the previous year. The FSS assessed that the industry is gradually improving in terms of shareholder rights exercise.
Lee Chan-jin Criticizes ETF Advertising Practices and Product Imitation
Lee stated, "Since investors primarily rely on asset managers' advertisements when directly selecting ETFs, false and exaggerated advertising by asset managers is a very serious matter from an investor protection perspective," adding that "exceptional self-correction efforts are necessary." He emphasized, "Accurate investment information must be delivered to investors during the advertisement production and internal review process," and "In the ETF operation process, firms must do their utmost to manage tracking errors together with liquidity provider securities firms." Lee reconfirmed that the industry's own corrective efforts are needed regarding indiscriminate 'product copying' among asset managers to establish a sound ETF market order.
Samsung, NH-Amundi, VIP Asset Management Recognized for Best Practices
Lee expressed gratitude to Samsung, NH-Amundi, and VIP Asset Management, selected as model cases this year, as well as Mirae Asset, Kyobo AXA, Truston, and Shinhan Asset Management, which received favorable evaluations following last year, and Korea Investment and KB Asset Management, which achieved notable improvements compared to last year.
FSS Identifies Persistent Issues in Voting Rights Disclosure
Lee emphasized that formal disclosures and weak internal controls related to shareholder rights exercise still require improvement. According to the FSS, 121 out of 285 asset management companies (42.4%) subject to this year's inspection used formulaic reasons such as 'minimal impact on shareholder meetings' or 'no infringement of shareholder rights' in over half of their voting rights exercises. Lee urged, "So-called 'copy-paste' disclosures are still being made regarding voting rights exercise and disclosure, which needs improvement," adding that "there is a need to substantiate voting rights exercise procedures so that investors can assess the appropriateness of voting rights exercise."
FSS Plans July-August Explanatory Sessions for Asset Managers
The FSS stated, "We plan to hold explanatory sessions for public and private asset managers in July-August to explain inspection standards and results, as well as insufficient and exemplary cases," adding that "we will continue to strengthen communication with the industry so that the asset management industry can faithfully fulfill its fiduciary duty."
FAQ
What did FSS Governor Lee Chan-jin discuss with asset management CEOs?
Lee Chan-jin held a meeting with chief executives of 20 asset management firms to discuss the results of the 2026 voting rights and shareholder rights exercise system inspection and ETF-related practices. He criticized false and exaggerated ETF advertising, product copying practices, and persistent copy-paste voting rights disclosure methods, calling for industry self-correction.
What were the shareholder rights exercise rates reported in the 2026 FSS inspection?
According to the FSS survey, shareholder rights exercise rates for public and private fund asset managers were 79.6% in 2024, 91.6% in 2025, and 91.8% in 2026. Opposition rates were 5.2% in 2024, 6.8% in 2025, and 8.2% in 2026. The FSS noted gradual improvement in the industry's shareholder rights exercise performance.
Which asset management firms received recognition from the FSS?
Samsung, NH-Amundi, and VIP Asset Management were selected as model cases this year. Mirae Asset, Kyobo AXA, Truston, and Shinhan Asset Management received favorable evaluations following last year. Korea Investment and KB Asset Management were recognized for notable improvements compared to last year.
