Proxy adviser ISS opposes KB union-backed outside director

• Published date: 09 March 2023
• Publication title: The Korea Times

The Institutional Shareholder Services (ISS), the world's largest proxy adviser, has recommended shareholders of KB Financial Group vote against the nomination of an outside director endorsed by the group's labor union, according to industry sources, Thursday.

The ISS' advice came ahead of the annual shareholders' meeting that is scheduled for March 24. If disapproved by shareholders, it will mark the sixth time since 2017 that KB's union failed to get an outside director they endorsed.

On Jan. 30, KB's union recommended Lim Gyeong-jong, who formerly headed Koexim Mandiri Finance co-owned by Export-Import Bank of Korea (Eximbank) in Seoul and Pengelola Investama Mandiri Indonesia in Jakarta, as a candidate for the outside director position.

Accordingly, it submitted a proposal and a letter that authorizes shareholders to decide on Lim's candidacy on its behalf to the KB board of directors.

"And after going over the proposal, ISS said it does not find Lim's expertise cited by the union convincing enough that it can contribute to shareholders' interests," a source said.

The union said Lim is "a figure who has a deep understanding of the banking industry and is also capable of carrying out the job in a fair and objective manner."

In particular, the union highlighted Lim as "the right man to bolster the sales capability and normalize management" of KB Bukopin, a subsidiary of KB Kookmin Bank in Indonesia.

KB Kookmin Bank is the Korean banking group's flagship affiliate.

The ISS' advice is not legally binding. Regardless, KB Financial Group said it is "paying...