Financial Services Commission: "Three ESG Evaluation Agencies Mostly Comply with Model Guidelines"

Korea ESG Institute, One Clause Item Inadequate

Three domestic ESG (Environmental, Social, and Governance) evaluation agencies have been found to generally comply well with the guidance (best practice standards) established to ensure fair operations.

On the 27th, the Financial Services Commission announced in the 'ESG Evaluation Agencies Guidance Compliance Status' report that all three companies?Sustinvest, Korea ESG Standards Institute, and Korea ESG Research Institute?are adhering to most of the guidance items.

The guidance is a self-regulation framework prepared by the three major domestic ESG evaluation agencies with support from the Financial Services Commission and the Korea Exchange. It consists of six chapters and 21 articles covering internal control system establishment, disclosure of evaluation systems, conflict of interest management, relationships with evaluated companies, and more.

While the evaluation agencies generally comply well with the guidance, the ESG Research Institute was found to have failed to comply with one article (providing an opportunity for evaluated companies to explain themselves).

The Financial Services Commission stated, "The agency in question plans to supplement the related procedures in the future," and added, "We will strive to improve the level of guidance compliance among each evaluation agency."

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