NPS to oppose some BioLogics resolutions

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NPS to oppose some BioLogics resolutions

The National Pension Service (NPS) is planning to vote against a number of resolutions at the Samsung BioLogics shareholders meeting today.

Among the proposals to which it will likely object is the reappointment of BioLogics’ vice president and chief technology officer, Kim Dong-joong.

The NPS, which is the country’s largest institutional investor and No. 3 pension fund by assets under management globally, adopted a stewardship code last July. Under the code, it will take a more active role as a shareholder.

If the NPS exercises its vote during the pharmaceutical company’s shareholders meeting, it would be the first such vote since adopting the code.

The NPS committee focused on the exercising of shareholder rights met Wednesday. It discussed how to vote on various issues during the meetings of Samsung BioLogics and Hyundai Elevator.

The NPS said the committee decided to vote against the reappointment of Samsung BioLogics CTO Kim and against the approval of the company’s financial statement.

The committee said reappointing a CTO who was accused of fraud not only harms value but also violates shareholder rights. It added that it would not approve the appointment of outside directors who have failed to meet audit-related obligations.

The NPS said it had a 3.07 percent stake in Samsung BioLogics as of April last year, but it is believed to have increased its share to over 4 percent.

The NPS committee decided to cast its votes against Samsung BioLogics as the company is currently under investigation for alleged accounting fraud. The company stands accused of inflating the value of its Samsung Bioepis affiliate during the BioLogics initial public offering.

Last year, the Securities and Futures Commission proposed dismissing company CEO Kim Tae-han and CTO Kim due to their involvement in the alleged fraud.

CTO Kim reportedly played an important role as he was the executive responsible for the company’s accounting at the time.

In December last year, the office of BioLogics was raided by prosecutors. Other Samsung affiliates were also raided, including Samsung SDS and Samsung C&T.

On hearing news that Samsung BioLogics plans to reappoint its CTO, Kim Sang-jo, Korea’s Fair Trade Commission chairman, expressed his disappointment.

“Although I understand it is difficult for the company to change its previous position, it should work on acting more aggressively where it can gain empathy from the market,” Kim Sang-jo said during a press briefing held on March 15 in Berlin.

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