Economic YouTuber Shuka (Shuka World) criticized the government's recent discussion on "semiconductor excess profits," questioning, "Why is there no mention of shareholders?"
In a live broadcast on July 19, Shuka shared insights from a recent forum hosted by the Ministry of Employment and Labor titled "A New Path for Social Innovation in Line with AI Technological Innovation."
The forum featured labor and management representatives along with various experts discussing the potential for new social contracts in the age of AI and the distribution of excess profits in the semiconductor industry.
During the event, Minister of Employment and Labor Kim Young-hoon stated, "The AI transition is a civilizational shift," and posed the question of how to define the total benefits generated by this transition. He argued that the existing labor-management relations framework is inadequate for distributing these collective benefits and called for social reforms suitable for the new era.
In contrast, Minister of Trade, Industry and Energy Kim Jeong-kwan emphasized that corporate profits should lead to investments for future growth, asserting that labor relations and labor systems rooted in the industrial age must evolve to meet the demands of the AI era.
Experts attending the discussion expressed caution regarding the distribution of excess profits. They noted that excess profits are difficult to measure objectively and that arbitrary criteria could undermine corporate innovation and exacerbate social unrest.
They also pointed out that the semiconductor industry requires significant capital investment and research and development, and that profits should be used to fund future investments due to the high risks involved.
Shuka highlighted the absence of shareholders as a major issue in the discussion. He remarked, "In my opinion, why are shareholders not included in this conversation? Shouldn't the discussion about profits start with shareholders?"
He further questioned, "Whether a company invests or provides bonuses, shouldn't it be done with the consent and understanding of shareholders? Why are discussions about dividends and share buybacks sidelined?"
Shuka referenced the recently amended Commercial Act, stating, "The amendment requires directors to faithfully perform their duties for the company and its shareholders, protecting the interests of all shareholders. Therefore, it is impossible to discuss corporate profits without including shareholders."
He acknowledged that companies must consider stakeholders such as employees, partners, and local communities but argued that the notion that corporate profits do not belong to shareholders is untenable. "If that were the case, who would take the risk and invest?" he asked.
Shuka pointed out that Samsung Electronics' stock price has fallen nearly 33% from its peak. He questioned, "If corporate profits do not belong to shareholders, was I mistaken in thinking I owned a part of the company? If so, I should get my lost money back."
He also cited Apple as an example, stating, "Apple is at least honest with its shareholders," as it returns approximately $110 billion annually through share buybacks and dividends while maintaining a steady total shareholder return (TSR).
Shuka concluded by questioning the origins of the "Korea Discount," suggesting it stems from neglecting shareholders. He warned that if companies continue to push shareholders aside after making profits, efforts to resolve the Korea Discount will be hindered.
As Shuka's comments spread online, discussions and criticisms regarding government policies emerged in various forums. One user remarked, "Even if corporate performance improves, shareholder returns through dividends and buybacks must increase for stock prices to rise. If companies signal they will take profits in other ways, the significance of the Commercial Act amendment may diminish."
Another user added, "It's not enough for performance to improve; those profits must return to shareholders to create an incentive to invest. If shareholders remain marginalized, the factors contributing to the discount on the Korean stock market will persist, and the government may be sending the wrong signals to the market."
* This article has been translated by AI.
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