The long-awaited legislation, the Act on the Corporate Governance of Financial Companies (the “Act”) will finally come into effect on 1 August 2016 after its promulgation on 31 July 2015. As its title suggests, the Act was introduced in an effort to improve and strengthen the current financial corporate governance regime and provide for uniform and systematic standards for the corporate governance of financial companies in Korea. Whilst the Enforcement Decree of the Act which outlines the specifics as to how the Act will apply is yet to be announced, financial companies should take time to review their policies and compliance programs to ensure they are adequate in responding to the new requirements mandated under the Act. The Act contains the following key measures.
- Applicability of the Act
- Largest Shareholder Eligibility Tests
- Strengthening of Board Rights and Outside Directors Driven Board
- Strengthening of Executive Responsibilities
- Strengthening of Internal Corporate Governance Standards
- Remunerations
