SOUTH KOREA Law and Practice Contributed by: Bo Hee Park, Minhyun Cho, Ian Kim and Jun Hee Kwon, Jipyong LLC
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1. Corporate Governance Requirements 1.1 Corporate Forms and Governance Requirements The Korean Commercial Code (KCC) permits five types of companies: stock companies, limited com - panies, limited partnership companies, partnership companies and limited liability companies. Accord - ing to statistics maintained by the Supreme Court of Korea, based on information gathered from corporate registries, as of March 2026, approximately 89.5% of companies in Korea – including all listed companies – are stock companies, and other forms are rarely used. Given the overwhelming prevalence of stock compa - nies, the responses in this chapter are applicable to stock companies unless otherwise specified. 1.2 Corporate Governance Legislation and Regulation The primary source of law governing corporate gov - ernance in Korea is the KCC. The Financial Invest - ment Services and Capital Markets Act (the “Capital Markets Act”) supplements the KCC by imposing additional regulations on listed companies, includ - ing requirements related to public disclosure, insider trading and the composition of the board of directors. In addition, listed companies must comply with the Regulation on the Issuance and Disclosure of Securi - ties of the Financial Services Commission (FSC), as well as the Listing Regulations and Disclosure Regula - tions of the Korea Exchange (KRX).
1.3 Companies With Publicly Traded Shares All listed companies in Korea are stock companies. Therefore, listed companies must comply with the corporate governance requirements applicable to stock companies. In addition, there are corporate governance requirements that apply exclusively to listed companies. For details on the corporate gov - ernance requirements applicable to stock companies (general meetings of shareholders, boards of direc - tors, chief executive officers or executive officers, and auditors or audit committees), please refer to 2. Cor- porate Management , 3. Directors and Officers and 4. Shareholders . The following explains the require - ments applicable only to listed companies. Corporate Governance Requirements for Listed Companies Appointment and ratio of independent directors In principle, a listed company must ensure that inde - pendent directors – ie, directors who are not engaged in the regular business of the company (known as “outside directors” under the previous version of the KCC) – constitute at least one-third of the total num - ber of directors. For listed companies with total assets of KRW2 trillion or more as of the end of the latest fiscal year, the board must include at least three inde - pendent directors who must also constitute a majority
of the total number of directors. Gender diversity of directors
Companies with total assets or capital of KRW2 trillion or more cannot have a board of directors comprised entirely of a single gender.
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