Samsung Life Investing in Chile Solar Power and Kyobo Life Focusing on Fuel Cells (Comprehensive)

Life Insurers' Big 3 Increasing Responsible Investments... ESG Investments Near 10 Trillion Won

[Asia Economy Reporter Oh Hyung-gil] As ESG (Environmental, Social, and Governance) management emerges as a key topic, insurance companies have significantly expanded their social investment expenditures. Since insurers manage assets using premiums received from customers, greater social responsibility is required. They have established policies to contribute to social prosperity through sustainable investments and exclude investments in socially harmful companies.

According to the insurance industry on the 10th, the big three life insurers?Samsung, Hanwha, and Kyobo Life?made eco-friendly and socially responsible investments totaling around 10 trillion KRW last year.

Samsung Life Insurance supported 4 trillion KRW in ESG-related investments. It invested 1.9 trillion KRW in renewable energy sectors such as solar and wind power, as well as water purification projects like sewage pipelines. The investment scale in green bonds and sustainability bonds reached 2.1 trillion KRW. This year, Samsung Life plans to increase ESG-related investments by more than 1 trillion KRW and expand them to 20 trillion KRW by 2030.

In particular, ESG investments are actively being conducted not only domestically but also overseas. Samsung Life invested 286.2 billion KRW in a project to build solar power plants in the Chubu and Tohoku regions of Japan, and 97 billion KRW in power generation projects constructing and operating solar and wind power plants in Chile.

They signed an investment agreement for the construction and operation of a total of 100 MW of small-scale solar power plants across Chile. Once all plants are completed, it is expected to reduce greenhouse gas emissions by approximately 100,000 tons annually (converted to CO2) compared to fossil fuel power generation.

Following the 2018 coal phase-out declaration that banned new financial support for coal mining and power generation projects, investment guidelines prohibiting new investments in industries such as gambling and tobacco have also been established.

Samsung to Expand ESG Investments to 20 Trillion KRW by 2030
Hanwha Establishes ESG Investment Guidelines for Special Accounts
Kyobo Plans Investment in Fuel Cell Power Generation Projects This Year

Hanwha Life Insurance has completed the establishment of ESG investment guidelines targeting performance-linked special accounts to reflect ESG factors in investment decision-making. These guidelines apply to investment assets in performance-linked special accounts such as stocks and bonds. Industries or companies negatively evaluated based on ESG assessments from external professional institutions are excluded from investment targets.

Last year, Hanwha invested 1.3784 trillion KRW in renewable energy sectors and 462.6 billion KRW in water resources and sewage treatment sectors. It also supported social investments worth 145.2 billion KRW to secure schools and cultural facilities.

In January, Hanwha Group’s financial affiliates including Hanwha General Insurance, Hanwha Investment & Securities, and Hanwha Asset Management declared coal phase-out financing. They decided not to participate in project financing for domestic and overseas coal power plant construction and not to underwrite bonds issued by special purpose companies (SPCs) for coal power plant construction.

Kyobo Life Insurance plans to invest this year in fuel cell power generation projects classified as renewable energy. Fuel cells, which produce electricity, heat, and water through electrochemical reactions between hydrogen and oxygen without combustion, are gaining attention as a power source with almost no air pollutant emissions. Last year, Kyobo invested 2.5222 trillion KRW in solar power and 125 billion KRW in wind power.

In May, Kyobo Life declared coal phase-out financing together with group affiliates and joined the international Carbon Disclosure Project (CDP) as a signatory to respond to climate change. While continuously expanding ESG investments, Kyobo plans to introduce its own ESG investment evaluation list to systematically organize its investment process.

An industry official said, "Due to corporate social responsibility and the climate change crisis, movements to reflect ESG factors in investments are rapidly emerging," adding, "ESG investments are gaining attention not only for helping companies’ positive reputations but also as new opportunities in terms of profitability."

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