South Korea's Financial Supervisory Service and the Korea Financial Investment Association held a workshop for compliance officers to strengthen internal control capabilities in the asset management industry.

The FSS said on Thursday it held the 2026 workshop for asset management firms' compliance officers jointly with the association.

Through the event, the FSS explained repeatedly occurring minor issues at managers, progress on introducing an accountability framework and points to note when operating exchange-traded funds (ETFs).

The industry presented and exchanged views on cases of improving compliance efficiency using artificial intelligence (AI), guidelines for adopting AI at asset management firms and points to note on ETF advertising regulations.

Seo Jae-wan (서재완), an assistant governor at the FSS, stressed the role and responsibility of compliance officers in introducing and operating the accountability framework. He also urged firms to follow the basics and principles of fund management and maintain a thorough compliance monitoring system in product advertising to protect trust in the asset management business.

Seo also stressed that issues discussed at the workshop should be shared with management and across the company to raise company-wide interest and support for internal controls.

The FSS explained the purpose and progress of introducing the accountability framework and provided the results of pilot inspections of large financial investment firms that have already adopted it.

It said small and mid-sized financial investment firms, including asset managers, need company-level preparations for effective operation as the accountability framework will take effect from July.

Inspection findings were also shared. The FSS explained repeatedly seen types of Capital Markets Act violations, including breaching collective investment agreements during fund management or failing to meet disclosure duties related to voting rights. It also asked for company-level management to prevent violations of various reporting duties due to unfamiliarity with regulations.

Points to note related to ETF operations were also discussed as a key agenda item. The FSS stressed the importance of building internal controls to prevent securities lending transactions and wash trades as the ETF market has grown quickly.

It urged industry-wide caution to prevent problems in managing liquidity and tracking error during operations by liquidity providers (LPs) and authorised participants (APs).

In industry presentations, cases of improving efficiency in compliance monitoring work using AI were introduced. Participants shared ways to standardise and automate internal control work by applying AI to tasks such as investment advertising reviews and extracting checklist items for operating restrictions.

Guidelines for asset managers' adoption of AI were also discussed. Practical points to note were introduced, including regulations to apply when asset managers use AI, risk assessments and control procedures, centred on AI guidelines for the financial sector.

On ETF advertising, key points to note related to investment advertising were provided, including advertising disclosures and how to present management performance and rates of return, so investors can clearly understand product characteristics and investment risks.

A financial authorities official said they plan to continue communication and cooperation through regular workshops to strengthen internal controls and work to protect investors and raise trust in capital markets.