Forming Committees and Issuing Bonds... Card Companies Focused on 'ESG'

Shinhan and Samsung Card Establish ESG Committees
Card Companies' ESG Bonds Reach 1 Trillion Won in Q1

[Asia Economy Reporter Ki Ha-young] As ESG (Environmental, Social, and Governance) management emerges as a key topic across the financial sector, credit card companies are also strengthening their ESG management. They are actively establishing ESG committees within their boards, launching ESG-specialized products, and issuing ESG bonds.

According to industry sources on the 31st, Shinhan Card and Samsung Card recently established ESG committees within their boards to reinforce responsible ESG management. This means that major ESG-related policy formulation is now overseen and managed by the board, the company's highest decision-making body.

Starting with the establishment of the ESG committee, Shinhan Card plans to operate an ESG council composed of executives and an ESG working council made up of department heads from relevant divisions. Having established an ESG-dedicated team last year, Shinhan Card also declared 'CDR management' this year, emphasizing corporate digital responsibility for the first time in the domestic financial sector. Samsung Card likewise plans to promote company-wide ESG management centered on its ESG committee and the ESG office established last year.

Earlier, Lotte Card strengthened ESG management by increasing the number of female outside directors to two, the first in the card industry, thereby enhancing the diversity of its board composition. KB Kookmin Card and Woori Card are also conducting various ESG activities, including launching ESG-specialized products, in line with the ESG management policies of their financial holding companies. The issuance of ESG bonds aimed at raising funds to support financially vulnerable groups and improve environmental sustainability is also noticeably increasing.

The scale of ESG bonds issued by card companies this year exceeded 1 trillion KRW in just the first quarter. Considering that card companies issued nearly 2 trillion KRW worth of ESG bonds last year, it is expected that this year's issuance will surpass that record. This month, KB Kookmin Card issued its first-ever foreign currency-denominated sustainable bond worth 300 million USD. Lotte Card issued 450 million USD worth of overseas asset-backed securities (ABS) as social bonds.

An industry official said, "As ESG management for sustainable development is emphasized worldwide, credit card companies are strengthening their ESG management in step with this trend."

This content was produced with the assistance of AI translation services.