South Korean firms face challenges as global disclosure rules tighten



Analysis South Korean firms face challenges as global disclosure rules tighten Stricter disclosure requirements in the EU and US force South Korean firms to adapt quickly or risk losing ground Soo-hyun LeeApril 1, 2024 SHARE COPY LINK FACEBOOK X LINKEDIN MASTODON Business buildings in Gangnam, Seoul \| Image: Canva As the world moves toward more stringent environmental, social and governance (ESG) disclosure requirements, South Korean companies face increasing compliance burdens and potential loss of their competitive advantage in global markets. Starting in 2025, South Korean companies valued above $1.48 billion (2 trillion won) must disclose their ESG performance, with the same requirement extending to all firms by 2027. This marks a significant shift from the South Korean government’s previously hands-off approach to sustainability disclosures, which allowed companies wide-ranging flexibilities in defining their ESG performance and raised concerns about greenwashing in reporting. Korean companies and law firms have called for © Korea Risk Group. All rights reserved. No part of this content may be reproduced, distributed, or used for commercial purposes without prior written permission from Korea Risk Group. LATEST ANALYSIS 01Why South Korea cannot rebalance growth without stronger regional clusters 02Samsung, SK Hynix rejection exposes South Korea’s chip-grid financing problem 03Trump’s Cheongung social media post tests Seoul’s refusal to arm to Ukraine 04Lee Jae Myung risks public trust as South Korea rewires its justice system 05South Korea turns to Central Asia as Iran war tests its energy resilience 06Houthi seizure of Mokha sharpens South Korea’s Hormuz deployment dilemma 07Japan’s stronger yen may cut Korea’s import bill while raising funding costs 08South Korea leans on Europe as Hormuz deployment choices grow narrower

Analysis

South Korean firms face challenges as global disclosure rules tighten

Stricter disclosure requirements in the EU and US force South Korean firms to adapt quickly or risk losing ground

Soo-hyun LeeApril 1, 2024

South Korean firms face challenges as global disclosure rules tighten

Business buildings in Gangnam, Seoul | Image: Canva

As the world moves toward more stringent environmental, social and governance (ESG) disclosure requirements, South Korean companies face increasing compliance burdens and potential loss of their competitive advantage in global markets.

Starting in 2025, South Korean companies valued above $1.48 billion (2 trillion won) must disclose their ESG performance, with the same requirement extending to all firms by 2027. This marks a significant shift from the South Korean government’s previously hands-off approach to sustainability disclosures, which allowed companies wide-ranging flexibilities in defining their ESG performance and raised concerns about greenwashing in reporting.

Korean companies and law firms have called for

South Korean firms face challenges as global disclosure rules tighten

LATEST ANALYSIS

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Soo-hyun Lee