South Korea’s Samsung Asset Management Co. has become latest institutional player to join the wave of so-called stewardship code, a guideline for institutional investors to exercise their voting rights, and other financial units of Samsung Group are also readying similar move.

A stewardship code is a set of guidelines for institutional investors to exert their voting rights to promote investor’s active involvement in corporate management such as in the decision-making of merger and acquisitions and dividend payouts with a goal of maximizing shareholder benefit.

According to finance industry sources on Friday, Samsung Asset Management made an unofficial decision to apply the stewardship code. The company is mulling adopting the guideline to fulfill its duty as an asset manager on behalf of shareholders, said Samsung Asset Management’s high-ranking official who asked to be unnamed. It will wait for the Korea Corporate Governance Service’s guideline on the stewardship code in the first half next year to make the move official, added the official.

Samsung Asset Management with total managing funds reaching 212 trillion won ($179 billion) is the largest private institutional investor in Korea and the second largest institutional investor following state-run National Pension Service, which oversees funds of 545 trillion won. The firm also directs asset management works of Samsung Group’s financial subsidiaries and it has handled its affiliate Samsung Life Insurance Co.’s bond asset management since last year.

Samsung Group’s other financial subsidiaries reportedly are also mulling introducing the stewardship code. Samsung Life Insurance, the country’s leading life insurer with assets under management amounting to 193 trillion won is positively looking into adopting the guideline while Samsung Fire & Marine Insurance Co. is in early review stage of introducing the stewardship code.

Earlier this month, the nation’s largest asset manager Mirae Asset Global Investments Co. unveiled its plan to implement the stewardship code. NPS and a handful other public funds are also studying to adopt the system.

By Choi Jae-won and Park Joon-hyung

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