"Certification Qualification System Must Be Introduced for ESG Information Reliability"

There has been a call for the introduction of a certification qualification system to enhance the reliability of ESG (Environmental, Social, and Governance) information.

At the 4th ESG Certification Forum hosted by the Korean Institute of Certified Public Accountants held on the 4th at the Federation of Korean Industries (FKI) Conference Center in Yeouido, Seoul, Professor Jeon Gyu-an of Soongsil University’s Department of Accounting stated, "To improve the reliability of ESG information in Korea and assist stakeholders in making ESG-related decisions, only those with certain qualifications should be allowed to participate in ESG certification."

Professor Jeon also said, "Mandatory ESG certification is only a matter of timing and method for Korea, so preparation for mandatory sustainability certification is necessary," adding, "Along with mandatory ESG disclosure, the mandatory certification should also be discussed and prepared together."

He further explained, "As adopted by the European Union (EU) and most countries, certification providers should not be limited to accounting firms; institutions with certain qualifications and accreditation should also be recognized as certification providers," and emphasized, "The requirements for accreditation as a certification provider must be clarified." Professor Jeon cited examples such as securing more than 10 certified personnel with qualification requirements and establishing a quality management system within the certification provider. He also proposed that accreditation bodies for ESG certification providers could include the Financial Services Commission and the Ministry of Economy and Finance, which are responsible for sustainability disclosure, or the establishment of a separate ESG accreditation body similar to those in France and Spain.

He also suggested separating the accreditation of general ESG information certification providers from that of greenhouse gas emission verifiers, proposing that the Ministry of Environment serve as the accreditation body for greenhouse gas verification institutions.

However, there were also calls at the forum for discussions from the corporate perspective. Kang Kyung-jin, Executive Director of the Korea Listed Companies Association, said, "The premise of necessary discussions is what kind of verification procedures will help improve a company’s ESG level and that practical confusion and costs should be minimized when companies undergo mandatory verification," adding, "It is thought that further review is needed on whether verification that confirms companies’ claims based on certain procedures is more necessary."

Earlier, the Financial Services Commission announced plans to gradually mandate ESG disclosure starting in 2025. The 'ESG Disclosure System Roadmap,' to be announced in the third quarter of this year, is expected to include details on ▲ companies subject to mandatory ESG disclosure ▲ domestic ESG disclosure standards ▲ third-party verification systems, among others.

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