South Korea’s Financial Services Commission (FSC) is expected to release draft ESG disclosure standards next week, following discussions with government departments, industry groups, investors and various experts. FSC Vice Chairman Kim So-young outlined the basic principles and key details of the draft disclosure rules, stressing that they were consistent with global standards and would ensure interoperability with the US and EU, thereby minimising the burden of redundant disclosure duties for businesses. The domestic disclosure standards will initially only mandate climate-related disclosures, though disclosures on non-climate-related ESG elements will also be introduced on a voluntary basis. The mandatory rules will require businesses to disclose information about climate-related risks and opportunities that can have an impact on investors’ decisions. Specifically, businesses will be required to disclose climate-related information under four categories: governance, strategy, risk management, and metrics and targets – consistent with international standards. The draft ESG disclosure standards will be submitted for public consultation on 30 April, following further discussions between related ministries and approval from the Korea Sustainability Standards Board. In October last year, the FSC decided to postpone the implementation of ESG disclosure requirements for listed companies from 2025 to at least 2026, reflecting delays in other key economies and giving domestic firms more time to prepare.
The standards will make climate-related disclosures mandatory and non-climate-related #ESG elements voluntary. @FSC_Korea https://t.co/PT7J502dh0
— Regulation Asia (@RegulationAsia) April 25, 2024
