Two global shareholder voting advisors oppose activist funds in S. Korea

Institutional Shareholder Services (ISS) and Glass Lewis, the world's two biggest advisory bodies for shareholder voting rights, have recommended opposition to a series of shareholder proposals from activist funds amid a heightened number of such motions at shareholders' meetings this year.

Analysts say this could put the brakes on such aggressive proposals from such funds.

Sources in the financial investment sector on Sunday said the Rockville, Maryland-based ISS recently released a report on companies that activist funds made shareholder proposals for including KT&G Corp., Kisco Holdings, BYC Co., Namyang Dairy Products and JB Financial Group Co. Except for KT&G and Namyang that it found partially in favor for, the body recommended opposition to all other proposals.

The San Francisco-based Glass Lewis also published a report on Kisco, KT&G, JB and others, recommending "oppose" for the proposals except for that for Kisco.

Companies whose shareholder proposals from activist funds are reflected in the shareholders' meeting agenda are Kisco, for which Value Partners Asset Management has brought the proposal, JB (Align Partners Asset Management), KT&G (Flashlight Capital Partners and Anda Asset Management), Taekwang Industrial and BYC (Truston Asset Management), and Namyang (Cha Partners).

Such funds demanded that the companies expand dividends, buy back their own shares and name specific candidates as outside directors.

Write to Gyo-Beom Gu at gugyobeom@hankyung.com