Gov't finalizes ESG disclosure requirement for large listed firms

Korean companies with 10 trillion won ($6.6 billion) or more in consolidated assets will be required to disclose information on their environmental, social and governance (ESG) performance and risks starting in 2028, officials said Wednesday.

The government and the ruling Democratic Party announced the plan, which covers a broader range of companies than the initial draft, officials said.

Under the plan, Kospi-listed companies with 10 trillion won or more in consolidated assets will be required to publish ESG reports starting in 2028. The requirement will be expanded to companies with assets of 5 trillion won or more in 2029.

The authorities will also consider extending the requirement to companies with assets of 2 trillion won or more beginning in 2030.

The number of companies subject to the mandatory disclosure requirement is expected to reach 291 in 2028 and 3,171 in 2029.

The government's initial draft, released in February, would have required only companies with 30 trillion won or more in assets to make ESG disclosures starting in 2028.

The government, however, revised the proposal after gathering feedback from businesses, broadening the disclosure requirement to help investors and other stakeholders assess companies' sustainability, ethical practices and long-term value, while discouraging greenwashing and other deceptive marketing practices.

The government and the ruling party plan to amend relevant laws to implement the program.

Yonhap