Platform launch ceremony held Wednesday ahead of next year's electronic shareholder meeting rollout

eVOP to support both inbound and outbound voting rights across borders

Foreign shareholder identity verification and duplicate voting prevention also built in

From left: Kim Jung-won, CEO of Nongshim NDS; Min Dong-wook, chairman of the Korea Listed Companies Association; Jeong Gyu-il, vice chairman of Korea Exchange; Park Min-woo, standing commissioner of the Financial Services Commission's Securities and Futures Commission; Kim Nam-hoon, director general of legal affairs at the Ministry of Justice; Lee Yun-su, president of Korea Securities Depository; Noh Hyeok-jun, professor at Seoul National University School of Law; Hwang Seong-yeop, chairman of the Korea Financial Investment Association; and Yun Chang-hyeon, president of Koscom, pose for a photo at the Korea Securities Depository's electronic shareholder meeting launch and platform opening ceremony at the Four Seasons Hotel in Jongno-gu, Seoul, on Wednesday. [Korea Securities Depository]
From left: Kim Jung-won, CEO of Nongshim NDS; Min Dong-wook, chairman of the Korea Listed Companies Association; Jeong Gyu-il, vice chairman of Korea Exchange; Park Min-woo, standing commissioner of the Financial Services Commission's Securities and Futures Commission; Kim Nam-hoon, director general of legal affairs at the Ministry of Justice; Lee Yun-su, president of Korea Securities Depository; Noh Hyeok-jun, professor at Seoul National University School of Law; Hwang Seong-yeop, chairman of the Korea Financial Investment Association; and Yun Chang-hyeon, president of Koscom, pose for a photo at the Korea Securities Depository's electronic shareholder meeting launch and platform opening ceremony at the Four Seasons Hotel in Jongno-gu, Seoul, on Wednesday. [Korea Securities Depository]

"eVOP is an innovative product that represents the smartest transformation in our capital market infrastructure. It will dramatically shift the paradigm of South Korea's shareholder meeting culture, transcending the time and space constraints of general meetings."

Lee Yun-su, president of Korea Securities Depository, made the remarks Wednesday at a press briefing held at the Four Seasons Hotel in Jongno-gu, Seoul, to mark the introduction of electronic shareholder meetings and the launch of the eVOP platform.

eVOP is a comprehensive electronic voting support platform covering the full range of electronic shareholder meeting functions. It supports the entire process — from advance electronic voting, which takes place up until the day before a shareholder meeting, through to in-meeting electronic voting on the day itself.

Korea Securities Depository introduced an electronic voting service for shareholder meetings in 2010 and has since expanded participation to mobile channels, supporting the exercise of voting rights at listed companies. The eVOP platform was built on the operational experience accumulated over that period.

Lee also unveiled eVOP's future strategic priorities for driving innovation in South Korea's voting rights market. Central to the plan is building a global platform that supports the exercise of voting rights by both domestic and foreign investors across national borders.

"When domestic and foreign investors can easily exercise their voting rights in a given company regardless of where they are located, a new global standard will emerge in the field of electronic voting rights," Lee said. "It will also make a meaningful contribution to achieving a Korea premium in our capital market."

Korea Securities Depository signed an MOU with Broadridge, a global proxy services firm, in September. Based on that agreement, the depository plans to build a system supporting electronic voting by foreign investors in domestic shares and by domestic investors in overseas shares.

Park Jung-hun, head of Korea Securities Depository's electronic voting rights division, said the integrated inbound and outbound cross-border voting support infrastructure "will be the world's first innovative model of its kind in the history of global capital markets."

Security and stability were the top priorities in building the platform. Park said the depository applied the same physical safety framework, anti-hacking measures and triple-redundant data storage system used in its electronic registration and settlement functions and other critical national infrastructure.

Accessibility for foreign shareholders has also been enhanced. Once the electronic shareholder meeting system takes effect next year, foreign shareholders will be able to attend shareholder meetings directly online. Korea Securities Depository worked with its network of domestic standing agents to implement a foreign shareholder identity verification system that assigns shareholder identification codes and passwords.

A mechanism to prevent duplicate voting has also been put in place. Shareholders who wish to attend in person on the day of a meeting can cancel their electronic shareholder meeting registration before entering the venue. Those who have already completed advance electronic voting or registered to attend an electronic shareholder meeting can cancel that registration and switch to in-person attendance. Even shareholders who have already logged into the online meeting room can be blocked from the electronic venue and redirected to attend in person.

"The duplicate attendance prevention system ensures that shareholders can exercise their voting rights in a variety of ways while preventing any voting right from being exercised more than once," Park said.

A commemorative ceremony following the press briefing drew about 150 attendees, including officials from the Financial Services Commission, major listed companies, securities-related institutions, the financial investment industry, academia, the legal community, and counterpart organizations overseeing electronic shareholder meetings in the United States, Taiwan and Japan.

Lee Jin-su, vice minister of justice serving as acting minister, said in a welcoming address that the introduction of electronic shareholder meetings "will allow all shareholders to fully express their views, making corporate decision-making fairer and more transparent and contributing to the advancement of the capital market." Lee added that the ministry would spare no effort in supporting both shareholders and companies in making convenient use of the electronic shareholder meeting system.

Park Min-woo, standing commissioner of the Financial Services Commission's Securities and Futures Commission, said the commission would "actively cooperate with the Ministry of Justice and relevant agencies to provide the necessary institutional support so that the electronic shareholder meeting system can take root in the market."

After the ceremony, a seminar was held for about 330 shareholder meeting officers from more than 210 listed companies required to hold electronic shareholder meetings. The seminar introduced the scope of eVOP's services and its key features, and included a system demonstration aligned with the shareholder meeting process.

A question-and-answer session followed on the practical preparation steps and considerations for listed companies ahead of the transition. Kim Ji-pyeong, an attorney at Kim & Chang, explained the key legal issues that may arise during the introduction and conduct of electronic shareholder meetings.


moon@heraldcorp.com