A Milestone in Korea's Journey Toward Sustainable Corporate Management: Five Years of the K-ESG Alliance
Bridging Policy and Industry:
Five Years of the K-ESG Alliance
As global economic order was reshaped around sustainability during a period of turbulence, the FKI K-ESG Alliance served as a practical bridge, driving voluntary innovation throughout Korean industry while facilitating dialogue between businesses and policymakers.
Across various settings—including early breakfast meetings in Yeouido, policy presentations from members of the National Assembly, and ministerial leaders' policy vision briefings—we engaged in intensive and sustained collaboration, culminating in institutional incentives that addressed practical business concerns.
These cooperative initiatives transformed major policy priorities into practical growth drivers for industry through the proactive adoption of global standards and engagement in national-level efforts to overcome social challenges and strengthen energy security.
We look back on a journey of public-private cooperation that has sought solutions for sustainable management in Korea, lasting across 14 rounds of close-knit dialogue.
As the global wave of mandatory sustainability disclosure gathered force through initiatives led by the ISSB, EU ESRS, and the U.S. SEC, the Alliance provided close, practical support to help Korean listed companies systematically measure non-financial performance and strengthen their disclosure capabilities.
Inaugural Meeting (May 12, 2021)
ESG Rating Indicators and Climate Risk Management
• Speakers: Jhin Young Shin, President, Korea Corporate Governance Service; Man-Yeon Choi, Country Head for Korea, BlackRock
- The K-ESG Alliance was officially launched as a multinational ESG alliance council, bringing together leading Korean and global companies alongside related organizations
- The world's largest asset manager shared its ESG investment principles and strategies were explored to help Korean companies align disclosures with global standards
3rd Meeting (October 7, 2021)
Institutional Investors: ESG Investment Principles and Future Outlook
• Speakers: Yong-jin Kim, Chairman & CEO, National Pension Service; Jong Kyoo Yoon, Chairman & CEO, KB Financial Group
- Discussed the public role of financial institutions in supporting the ESG transition of Korea's export-driven manufacturing sector and financial support measures for Korean companies
- Examined the unintended effects of rising natural gas and other energy prices, or "greenflation," during the transition away from coal, along with their broader market implications
4th Meeting (September 16, 2022)
Current Status and Future Direction of ESG Disclosure Policy
• Guests and Speaker: So-young Kim, Vice Chairman, Financial Services Commission
- The government's plans to strengthen the institutional framework for disclosure, evaluation, and investment while expanding ESG support for SMEs and middle market enterprises were shared
- Called for greater standardization and integration of disclosure requirements related to corporate governance, environmental information, and sustainability management information, which had been fragmented across various ministries
7th Meeting (September 19, 2023)
International Developments and Domestic Trends in Sustainability Disclosure Standards
• Speaker: Han-sang Lee, President, Korea Accounting Institute (Chair, KSSB)
- Examined the practical implementation challenges and data collection risks facing large Korean manufacturers with extensive overseas operations when preparing consolidated sustainability disclosures
- Called for the establishment of clear implementation guidelines (reaching a consensus) and the affording of sufficient preparation time, aimed at improving disclosure reliability and minimizing confusion
2026 K-ESG Forum (May 26, 2026)
Information Sharing and Training: Korea's ESG Disclosure Roadmap
• Co-host: Korea Accounting Institute
- Reviewed practical implementation challenges facing Alliance member companies and their ESG staff as the government begins to advance its ESG disclosure roadmap in earnest
Working closely with government ministries responsible for macroeconomic policy and newly established regulatory ministries, the Alliance facilitated the alignment of broader strategies aimed at addressing the global energy security crisis and accelerating carbon neutrality.
2nd Meeting (July 7, 2021)
Corporate Environmental ESG Initiatives and Policy Support
• Guests and Speaker: Rep. Wonwook Lee and members of the National Assembly Inclusive Nation ESG Forum
- Established a basis for regular expanded meetings involving the legislature, government, and the private sector
- Publicly discussed the need for bold support on a par with competing countries in terms of regulatory easing, in the context of carbon neutrality as a new form of trade barrier
- Identified eight practical policy recommendations reflecting practical business concerns, including tax incentives for green investment and tax credits for carbon reduction technologies
8th Meeting (January 24, 2024)
The Current Status of ESG Policy
• Guests and Speaker: Byung-hwan Kim, First Vice Minister of Economy and Finance
- Reviewed the establishment of ESG committees and voluntary implementation efforts among Korea's largest companies by revenue
- Shared government initiatives to strengthen national ESG infrastructure and support supply chain due diligence as global regulations begin to take shape
- Discussed government support measures, including tax incentives for low-carbon technologies, utilization of the Climate Response Fund, and the Integrated Employment Tax Credit
11th Meeting (June 20, 2025)
Integrating Climate and Energy Policy and Coordinating Korea's 2035 NDC
• Speaker: Rep. Jeoung-ae Han, Chair, National Assembly Special Committee on Climate Crisis
- Reviewed domestic and international developments surrounding Korea's 2035 NDC to be submitted to the United Nations
- Shared long-term policy initiatives, including plans for a new Ministry of Climate and Energy and proposed legislation on carbon neutral industries
14th Meeting (April 2, 2026)
Energy Policy Directions for Sustainable Development
• Speaker: Hohyeon Lee, Second Vice Minister, Ministry of Climate, Energy and Environment
- Reframed the current energy crisis as an opportunity for structural transformation through a diversified low-carbon energy mix and next-generation power grids
- Shared the government's plans to strengthen its green finance framework to support corporate-led carbon neutrality initiatives and the development of carbon-neutral industries
Moving decisively beyond the traditional environmental focus of ESG, the Alliance broadened its agenda to address critical national challenges, including labor market collaboration, demographic decline, and global energy security, incorporating these issues into a more comprehensive ESG strategy.
Reflecting the changing values of younger generations who increasingly prioritize work-life balance, the Alliance promoted preventive, self-regulatory approaches to labor policy. It also reframed Korea's declining birth rate as an issue of business survival and proactively introduced the concept of EF(Family)G Management, a distinctive management paradigm centered on work-family balance.
6th Meeting (May 12, 2023)
Building a Sustainable Labor Market Through Cooperation and Solidarity
• Guests and Speaker: Jung-sik Lee, Minister of Employment and Labor
- Reviewed the growing global focus on the Social Taxonomy framework and discussed Korea's response policy
- Explored performance-based compensation systems and a more flexible labor market, grounded on the changing workplace values held by Millennials and the Gen Z population
- For the practical reduction of industrial accidents, advocated shifting industrial safety policy from a punitive, regulation-driven approach toward preventive measures led jointly by employers and employees
10th Meeting (November 25, 2024)
A Sustainable Korea: Strategies to Reverse the Declining Birth Rate
• Speaker: Hyung-hwan Joo, Vice Chairman, Presidential Committee on Ageing Society and Population Policy
- Assessed structural risks posed by declining fertility rates and a shrinking working-age population impacting corporate competitiveness and long-term economic growth
- Provided data-backed evidence of the business community's associated voluntary efforts (10-years of data on employees utilizing parental leave and male employees utilizing parental leave)
- Introduced the EF(Family)G Management paradigm, emphasizing work-life balance, improved business practices regarding long working hours, and enhancing gender equality
The Alliance championed a corporate culture of voluntary compliance that extends beyond regulation and enforcement, helping companies build stronger governance systems while putting safeguards in place to protect the business environment from unintended legal risks.
Its sustained advocacy ultimately contributed to the institutionalization of reduced administrative fines for companies with exemplary Fair Trade Compliance Programs (CPs).
5th Meeting (December 1, 2022)
Promoting ESG Management Through Fair Trade CPs
• Speaker: Soo Hyun Yoon, Vice Chairperson, Korea Fair Trade Commission
- Reviewed ESG adoption trends across Korean industry based on voluntary disclosure statistics
- Explored measures to strengthen internal CPs that enable companies to proactively manage ESG-related risks, including fair trade compliance
- To avoid CP implementation acting as an additional regulatory burden, policy incentives were recommended, including exemptions from ex officio investigations, the adoption of overseas best practices, and reduced administrative fines for companies with effective CPs
9th Meeting (April 25, 2024)
2024 Fair Trade Policy Direction: ESG and Fair Trade
• Speaker: Ki-jeong Han, Chairperson, Korea Fair Trade Commission
- Reviewed the implementation of amendments to the Fair Trade Act that formally introduce reduced administrative fines for companies with exemplary CPs, reflecting proposals previously put forward by the Alliance
- Discussed more flexible and market-friendly policy approaches, reflecting the collective preference of listed companies with mandatory disclosure requirements
- Shared Fair Trade Commission initiatives linking ESG with fair trade, including guidelines on preventing greenwashing and promoting fair trade
13th Meeting (November 13, 2025)
Fair Trade Policy and ESG Management Strategy
• Speaker: Byung-Ghi Ju, Chairperson, Korea Fair Trade Commission
- Discussed measures to improve regulatory predictability by providing clearer guidance on environmental claims and advertising, ensuring that companies' sustainability efforts are not misunderstood or mischaracterized
- Clarified circumstances under which large corporations' requests for ESG-related information from suppliers would not constitute unfair trade practices, when complying with global supply chain regulations
