Regulator mulls change in executive disclosuresKorea’s financial regulator said yesterday it is considering a mandate requiring listed companies to disclose the salary of all their executives, a move that would open executive compensation to public scrutiny.
Listed firms are currently required to disclose the total amount they pay their executives, but not on an individual basis. The United States and Japan are among those countries that have already introduced the more thorough policy.
“We are reviewing a plan to require listed firms or financial firms to disclose the respective salaries of each executive,” said an official at the Financial Services Commission.
Another official said the plan’s feasibility is being reviewed at a working level, but added that no decision has been made yet. Some lawmakers are also moving to strengthen regulatory filings of executive compensation.
“Plans to push for the individual disclosure of corporate executives’ salaries are in progress, following the recent global financial crisis,” said Lee Jung-hee, chairwoman of the minor opposition Democratic Labor Party.
A revision to the capital market law that included such a plan was first put forward in March 2008, but has not been thoroughly deliberated, Lee said. Some market observers welcomed the regulator’s move, saying it would increase the transparency of corporate management and provide accurate information for investors.
However, the Korea Listed Companies Association said information on executive compensation should not be disclosed to individual investors as it is a private matter for management and shareholders.
“Regulations concerning disclosures have been stepped up to evaluate how executives’ salaries are tied to financial companies’ tendency towards risk-taking,” said Lee Si-yeon, a research fellow at the Korea Institute of Finance.
By Lee Jung-yoon, Yonhap [firstname.lastname@example.org]
More in Finance
Banks failed to tell borrowers they can demand rate cuts: FSS report
Stocks fall more than 1% as profit-taking continues
Profit-taking ends four-session winning streak for Kospi
Lottery sales hit record in the first half
Another recent high