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Stock-Based Compensation Agreements Surge Among Large Business Groups
Commercial Services · Financial Publishing/Services · yonhap_finance · 2026-09-03
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Large business groups in South Korea saw a 66% increase in stock-based compensation agreements for executives this year, with Samsung leading the trend.
What Happened
Rise in Stock Agreements: Among 89 business groups with a designated owner, stock-based compensation agreements rose by 65.7% year-on-year to 585 cases. This trend reflects a shift toward aligning executive incentives with shareholder value by replacing cash bonuses with stock.
Samsung's Lead: Samsung recorded the highest number of new agreements, with 317 cases, as the group transitioned its executive incentive system from cash to stock. This move is part of a broader corporate push to emphasize accountability and long-term performance.
Reduction in Circular Shareholding: Due to voluntary efforts by corporations, the number of circular shareholding links dropped significantly by 1,202 to 233. Groups like Sajo have notably simplified their ownership structures, contributing to a more transparent corporate governance landscape.
Ownership vs. Control: Despite these improvements, the gap between the direct shareholding of owner families and the total internal shareholding remains at 58 percentage points. The Fair Trade Commission noted that this indicates owners still maintain control over large groups with relatively small direct stakes, necessitating continued regulatory oversight.