Corporate Value-up Program (기업 밸류업 프로그램)

The Corporate Value-up Program is a Korean government initiative, unveiled by the Financial Services Commission on February 26, 2024, that encourages listed companies to voluntarily disclose and execute plans to raise their capital efficiency, shareholder returns, and valuations. It pairs guidelines and tax incentives with a dedicated KRX index, aiming to close the long-standing Korea discount.

What is the Corporate Value-up Program?

It is Korea’s institutional answer to the Korea discount, modeled in spirit on Japan’s earlier corporate-governance reforms. The Korea Capital Market Institute measured the gap the program targets: Korean equities traded at a price-to-book ratio of 1.2x over 2012 to 2021, ranked 41st of 45 countries, versus 2.2x in advanced and 2.0x in emerging markets, with insufficient shareholder returns the single largest explanatory factor (KCMI). The program has three pillars: guidelines under which listed companies voluntarily prepare, board-approve, and disclose annual corporate value enhancement plans on the Korea Exchange’s disclosure system; incentives, including awards and preferential tax treatment for strong participants; and market infrastructure, led by the Korea Value-up Index of 100 companies that KRX launched on September 24, 2024, with comparative PBR, ROE, and payout statistics published by sector (FSC; Newsis; KRX value-up portal). FSC Chairman Kim Joo-hyun framed the state’s role at the launch seminar:

“The government needs to support companies’ voluntary efforts to raise their value,” with the program operating as “a mid- to long-term project.”

— Kim Joo-hyun, Chairman, Financial Services Commission, February 26, 2024 (FSC)

Participation is voluntary, but the surrounding pressure is not static: the July 2025 Commercial Act amendment made directors accountable to shareholders, and from 2026 dividends from designated high-dividend companies receive separate, lower taxation, so the program now sits inside a wider legal and tax architecture pointing the same way.

How is the Value-up Program used in thematic investing?

It functions as a screen and a catalyst. The companies that respond hardest are the lowest price-to-book, highest-payout corners of the market, banks, financial holding companies, insurers, and conglomerate holding companies, which is the universe behind the Korea Financials & Holdings High Dividend concept. The plans are concrete and auditable: Shinhan Financial Group reached a 50.2% shareholder return ratio in 2025 under its plan and reset its targets in April 2026 around an ROE of 10% or more, a return ratio of 50% or more, and CET1 of 13% or more (Shinhan 6-K). For investors, a published value-up plan converts a soft governance story into dated, numeric commitments that can be tracked quarter by quarter.

Related terms & concepts

FAQ

What problem is the Corporate Value-up Program trying to fix?

The Korea discount: Korean equities traded at a price-to-book ratio of 1.2x over 2012 to 2021, against 2.2x in advanced markets and 2.0x in emerging markets, with weak shareholder payouts identified as the largest single cause (KCMI). The program pushes companies to publish and execute plans that raise returns on equity and shareholder returns (FSC).

Is the value-up disclosure mandatory?

No. Companies prepare and disclose corporate value enhancement plans voluntarily on the KRX disclosure system, with the board expected to lead the plan and update it annually; the state adds carrots such as tax incentives and index inclusion rather than penalties (FSC; KRX value-up portal).

Which sectors have responded most to the value-up push?

Banks, financial holding companies, and conglomerate holding companies, the lowest price-to-book corners of the market. Shinhan Financial Group, for example, reached a 50.2% shareholder return ratio in 2025 under its value-up plan and reset targets around an ROE of 10% or more and CET1 of 13% or more in April 2026 (Shinhan 6-K).

Sources & references

  1. Active Support to be Provided to Promote Voluntary Efforts of Listed Companies in Enhancing Their Value (Corporate Value-up Program) · Financial Services Commission (FSC), 2024-02-26
  2. KRX 기업 밸류업 지원 포털 (Corporate Value-up disclosure portal) · Korea Exchange (KIND)
  3. 거래소, '코리아 밸류업지수' 발표…삼전·현대차 등 100종목 포함 · Newsis, 2024-09-24
  4. 코리아 디스카운트 원인 분석 (이슈보고서 23-05) · Korea Capital Market Institute (자본시장연구원), 2023-02-16
  5. Shinhan Value-Up +++ (Triple Plus) corporate value-up plan (Form 6-K) · Shinhan Financial Group / U.S. SEC EDGAR, 2026-04-23