KSD to strengthen electronic voting system

KSD CEO Lee Byung-rhae

By Lee Kyung-min

The Korea Securities Depository (KSD) said Wednesday it will strengthen its electronic voting system, an effective way for the country's major firms to proceed with decision-making processes without neglecting minor shareholders' voting rights.

“Samsung Electronics and Hanjin KAL have made requests with us regarding specifics about implementing the system,” KSD CEO Lee Byung-rhae said during a meeting with a group of reporters on Yeouido in southern Seoul.

“The requests came as it is highly likely that SK Hynix will adopt the system in this year's shareholders' meeting.”

The KSD-developed system, also known as K-eVote, helps the firms reach a quorum in a regular shareholders meeting.

It is used by nearly 60 percent of publicly traded companies with the number on a steady rise.

The number of companies using the system increased to 1,204 in 2018 from 417 in 2015.

The shared interest from Samsung Electronics and the holding company of Hanjin Group illustrates growing demand from large conglomerates in need of meeting legal requirements without seeking a “costly and inefficient” alternative.

Many firms have hired private firms to have them seek proxy solicitation from minor shareholders, thereby moving the meeting forward without illegalities.

Meanwhile, the KSD said it will continue efforts to ensure an effective and safe implementation of electronic securities system.

Under the system, securities certificates of shares and bonds will no longer be issued in physical form, and subsequent rights will be recorded on an electronic register.

This will allow investors to acquire, transfer and exercise the rights electronically.

“We established a taskforce in August 2016 and came up with a roadmap for the full implementation of the system in January 2017,” Lee said.

“We will make sure the system will run in full operation without failures.”

The KSD is the nation's central securities depository providing central custody of securities, book-entry transfer and settlement of securities transactions.