South Korea’s Daishin Financial Group is set to roll out new business leveraging its think tank to provide proxy advisory services to institutional investors in the country lacking influential proxy guidance.
The company that runs securities and savings bank business last month decided to expand a corporate governance research organization under Daishin Economic Research Institute to provide corporate governance solutions to the financial community, according to Daishin and other sources on Sunday. The company has already begun staffing the new unit.
The decision was inspired by U.S.-based ISS (Institutional Shareholder Services), the world’s largest firm that examines the corporate practices of companies and advises institutional investors on how to vote on various company issues.
“Although the social environment is right for shareholder activism with the introduction of the Stewardship Code in Korea, institutional investors still lack infrastructure for exercising their voting rights properly,” said Kim Ho-jun who will lead the new organization, which is renamed as Daishin Corporate Governance Research Institute.
In Korea, only four to five companies including Korea Corporate Governance Service and Sustinvest are able to provide related proxy services.
“We are recruiting experts such as lawyers and accountants. Corporate governance consulting encompasses complex issues beyond voting right exercises and it requires deep domain expertise from legal and accounting professionals,” he added.
The new organization has hired 17 additional analysts, investment bankers and consultants. The financial group formed a team under its research institute to study corporate governance issues three years ago.
In 2015, it completed an analysis of some 400 listed companies and expanded its research scope to 600 last year.
By Han Ye-kyung
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