Korea Value-up Program Explained: Plans, Index, Laws and Results

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The Korea Value-up Program is a government drive, launched by the Financial Services Commission (FSC) on February 26, 2024, to close the “Korea discount” by getting listed companies to set and publish targets for valuation, profitability and shareholder returns. It began as voluntary disclosure, with 764 companies covering about 84% of market value filing plans by the end of September 2026, and it is now backed by binding law: Commercial Act amendments, mandatory treasury-share cancellation, a dividend tax break and a planned public list of persistently low price-to-book (P/B) companies.

What is the Korea Value-up Program?

The FSC and KRX unveiled the Corporate Value-up Program at a seminar on February 26, 2024. Its goal is to narrow the Korea discount, the tendency of Korean stocks to trade at lower valuations than foreign peers, which is explained in our Korea discount guide.

The FSC set out three pillars:

• Companies: guidelines for annual, board-led plans to raise corporate value, published on KIND and company websites.
• Investors: a Korea Value-up Index and ETFs, changes to the stewardship code, and KRX publication of P/B, P/E, return on equity (ROE), payout ratios and dividend yields by market and sector.
• Infrastructure: a dedicated KRX department, an advisory board and a web portal.

The FSC deliberately made disclosure voluntary, with no deadline. It argued that compulsory filings would produce box-ticking disclosures. From 2025 the policy mix shifted towards legislation, covered below.

All amounts are in Korean won (KRW); USD figures use about KRW 1,340 per USD, roughly the mid-October 2026 rate.

How do corporate value-up plan disclosures work?

Guidelines published on May 2, 2024 describe a plan with six parts: company overview, analysis of the current position, goals, plans, evaluation of implementation, and communication with shareholders. Companies are asked to analyse indicators such as P/B, ROE and shareholder returns against their own history and industry peers.

Targets should be numerical where possible, but ranges or qualitative goals are allowed. KRX exempts forward-looking targets from its penalties for unfaithful disclosure, and companies can revise them. Plans are meant to be updated every year, and follow-up “periodic” disclosures report on progress. By the end of May 2026, 113 companies had filed one.

The jump in March 2026 came from a tax rule. A decree approved on February 24, 2026 requires companies that qualify as “high-dividend companies” to confirm it through a value-up disclosure, so that their shareholders can use the new dividend tax regime. By the end of May 2026, 628 companies had filed on that basis, 538 of them for the first time (KRX).

In September 2026, eight companies filed new plans. They included Woojin INS, the first to use KRX’s separate P/B improvement-plan format.

What is the Korea Value-up Index?

KRX announced the index on September 24, 2024 and began publishing it on September 30, 2024. It launched with 100 stocks, 67 from KOSPI and 33 from KOSDAQ. Stocks were chosen on market capitalisation, profitability, shareholder returns, P/B and ROE. The index is weighted by free-float market capitalisation, with a 15% cap per stock, and has a base of 1,000 on January 2, 2024.

Investors criticised the initial list as inconsistent, in particular for leaving out the financial groups KB Financial and Hana Financial. KRX added five companies (KB Financial, Hana Financial, SK Telecom, KT and Hyundai Mobis) on December 20, 2024 without removing any. Constituents are reviewed once a year. In 2026, two companies picked as “value-up excellence” firms joined under a special rule on June 12.

The index stood at 992.13 on its first day of publication, September 30, 2024, reached a then-record 3,977.00 on May 29, 2026 and closed at 3,228.34 on September 30, 2026. That was up 79.6% in 2026, against 62.3% for the KOSPI. Since its first day it had gained about 225%, against about 164% for the KOSPI (calculated from KRX closing levels).

ETFs and futures on the index started trading in November 2024. At the end of May 2026, 13 Value-up ETFs held KRW 4.3 trillion. Our Korean ETF guide explains premiums, discounts and tracking error.

Which Value-up tax incentives actually passed?

The first attempt failed. In 2024 the government proposed a 5% corporate tax credit on increases in shareholder returns and lower, separate taxation of dividends. The National Assembly passed the 2024 tax bill on December 10, 2024 without either measure, after the opposition called them tax cuts for the rich.

The second attempt passed. Under the revised Restriction of Special Taxation Act, in force from January 1, 2026, dividends from qualifying high-dividend companies can be taxed separately instead of being added to other income. Previously, financial income above KRW 20 million a year was taxed with other income at rates up to 49.5%.

A company qualifies if its dividend payout ratio is at least 40%, or at least 25% with dividends up 10% or more on the previous year. These brackets matter mainly to Korean resident individuals. Non-resident foreign investors are generally taxed through withholding at source; see Korean stock taxes for foreigners.

What did the 2025–2026 Commercial Act amendments change?

The Commercial Act is Korea’s company law. Three amendments passed between July 2025 and February 2026 turned several Value-up goals into legal duties:

Cumulative voting gives each share as many votes as there are board seats being filled and lets shareholders put all their votes on one candidate. That makes it easier for minority shareholders to elect a director. It applies from the first director election held after the effective date, so the 2027 shareholder meeting season is likely to be the first real test.

Is treasury share cancellation mandatory in Korea?

Yes, since March 6, 2026, with exceptions. Under the third Commercial Act amendment, shares a company buys back must in principle be cancelled within one year, and a board resolution is enough to cancel them. Shares held before the law took effect get a six-month grace period before the one-year rule applies.

• Exceptions: a company may keep or sell treasury shares for purposes such as employee compensation, employee share ownership or business needs in its articles. It needs a holding and disposal plan approved by shareholders every year, and any sale must be offered to all shareholders pro rata.
• No hidden uses: treasury shares carry no voting, dividend or pre-emptive rights. They cannot be pledged, used to back exchangeable bonds or allocated new shares in mergers and spin-offs.
• Penalty: an administrative fine of up to KRW 50 million (about USD 37,000).
• Disclosure: from June 30, 2026, every listed company holding treasury shares must disclose its holdings and disposal plans. Before that, only companies holding at least 1% of their shares had to.

The effect was immediate. Listed companies cancelled KRW 43.1 trillion (about USD 32 billion) of treasury shares from January to May 2026, more than double the KRW 21.4 trillion for all of 2025 (FSC). How this affects Samsung Electronics and SK hynix is covered in our buyback note.

How did Korean dividend procedures change?

Until 2023, most Korean companies fixed the shareholders entitled to a year-end dividend on December 31 but announced the amount at the shareholders’ meeting in March. Investors had to buy without knowing what they would receive.

On January 31, 2023, the FSC and the Ministry of Justice issued an official interpretation of Article 354 of the Commercial Act. It lets companies decide the dividend first and set the record date afterwards. Companies must amend their articles of incorporation to adopt it, and from 2024 corporate governance reports must say whether they have. The FSC also planned a matching change to the Capital Markets Act for quarterly dividends.

The practical result is that the record date is no longer always the end of the year. Foreign investors should check each company’s dividend decision and record-date notice on DART or KIND before relying on a dividend.

What is the low-P/B company list?

This is the newest and most forceful part of the program. Under draft standards the FSC and KRX published on July 28, 2026, companies are ranked by P/B within 11 GICS sectors. A KOSPI company in its sector’s bottom 25% (bottom 10% for KOSDAQ) in six consecutive half-yearly rankings, or three years, will be named.

• Under the plan announced in July 2026, lists are to be published on the first trading day of May and November, starting on November 2, 2026, on KIND and with a “low PBR” tag in brokers’ trading apps.
• Companies that disclose a value-up plan with specific P/B improvement measures are exempt for one year. There is no exemption after six straight years in the bottom group.
• KRX simulations suggested 120 to 220 companies could be listed. The FSC and KRX are also considering using P/B in delisting reviews and in stewardship guidance for institutional investors.

According to SBS Biz, companies that file an improvement plan in KRX’s format by October 22, 2026 avoid the first list.

What results has the Value-up Program produced?

KRX tracks shareholder-return decisions announced by KOSPI and KOSDAQ companies:

Valuations rose too. KRX data show the KOSPI at 0.96 times book value on February 26, 2024, the day the program was announced, and 1.50 times on October 14, 2026, after peaking at 2.69 on June 1, 2026. The live series is on our KOSPI valuation tracker. How much of this came from policy rather than the memory-chip boom is impossible to separate cleanly.

What are the main criticisms?

• A slow, voluntary start: only 88 companies had disclosed or pre-announced plans by December 2024, when the tax incentives were also dropped.
• Index design: the first constituent list drew complaints about inconsistent selection, including firms involved in management disputes, prompting the December 2024 additions.
• Narrow gains: the Value-up Index is heavily weighted towards Samsung Electronics and SK hynix, so the chip recovery drove much of its outperformance. In April 2026, 63.5% of KOSPI companies still traded below book value.
• Disclosure quality: a Korea Capital Market Institute researcher has argued that companies should be pushed to explain clearly why they do or do not meet their targets.

Korea Value-up timeline

Frequently asked questions

Last reviewed: October 15, 2026.

Sources

1. Active Support to be Provided to Promote Voluntary Efforts of Listed Companies in Enhancing Their Value (Feb 26, 2024) and Guidelines on Corporate Value-up Plan Unveiled (May 2, 2024), Financial Services Commission
2. 월간 기업가치 제고 현황(‘26.5월) (Monthly corporate value-up status, May 2026), Korea Exchange, Jun 8, 2026
3. 밸류업 지수 뒷걸음질…첫 PBR 개선계획 공시 기업 나와 (KRX September 2026 value-up status), SBS Biz, Oct 6, 2026
4. Korea Value-up Index to begin publication next week, Korea JoongAng Daily, Sep 24, 2024
5. Value-up Index expanded after investor backlash, The Korea Times, Dec 16, 2024
6. Stumbling Over ‘Bujagamse’ Tax Cut Controversy… Value-Up, Corporate Incentive Plans Undermined, Asia Business Daily, Dec 11, 2024
7. Rival parties reach agreement on tax reform plan for dividend income, The Korea Times, Nov 28, 2025
8. Revised Rule to Require High Dividend Companies to Disclose Their Qualifications through Corporate Value-up Plans, Financial Services Commission, Feb 24, 2026
9. Main provisions and enforcement dates of the amended Korean Commercial Code, Kim & Chang, Oct 30, 2025
10. Korea’s new treasury share rules and what they mean for companies, Sodali & Co, Apr 13, 2026
11. Capital Market Rules Change on Disclosure of Treasury Share Holding Status Expected to Boost Corporate Value, Financial Services Commission, Jun 23, 2026
12. Authorities Plan to Improve Rules Regarding Dividend in Line with Global Standards, Financial Services Commission, Jan 31, 2023
13. FSC and KRX Introduce Draft Standards for Publishing List of Companies with Low Price-to-Book Ratios, Financial Services Commission, Jul 28, 2026
14. Despite Kospi bull run and value-up initiative, ‘Korea discount’ remains as six in 10 firms trade below book value, Korea JoongAng Daily, Apr 26, 2026
15. KRX Market Data System: KOSPI close and PBR (daily, 2004–Oct 14, 2026), Korea Exchange, retrieved via the site’s K-Expectation Index dataset, October 2026

This guide explains how the Korean market works for general information. It is not investment, legal or tax advice; rules change, so check the official sources listed above or a qualified adviser before acting.