NPS announces plan to adopt stewardship code
Published: 01 Dec. 2017, 19:53
Health and Welfare Minister Park Neung-hoo said on Friday that the decision is intended to keep the NPS abreast of the global standard. The Minister presides over the Investment Management Office of the NPS, which is the highest decision-making body.
First adopted in the United Kingdom in 2010, the stewardship code, which is not legally binding, lists a set of guidelines aimed at encouraging institutional investors to execute their voting rights in a more responsible manner and engage in the creation of sustainable, long-term corporate value.
“Some 20 advanced countries, including the United States and the United Kingdom, have embraced the stewardship code,” Park told reporters after the meeting.
“The stewardship code enables [the countries] to ensure mid to long-term profitability,” he said.
But he said that there are many factors to be taken into account and that the NPS will make progress in a gradual manner.
The core principle and objective of the stewardship code is to have institutional investors consider a more long-term perspective without any conflict of interests when engaging in corporate governance.
Such principals could be relevant to the NPS because the fund operator has been accused of deciding votes based not purely on profitability but political influences.
Several asset managers have adopted the rule, but the enrolment of the NPS is considered important given the size of the investment managed by the company.
The Financial Services Commission introduced the guideline last year.
BY PARK EUN-JEE [[email protected]]
with the Korea JoongAng Daily
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