"ESG, Answers Must Be Found On-Site" Korea Employers Federation Launches Third ESG Management Committee

The Korea Employers Federation announced on September 10 that it held the first meeting of the 2025 Third ESG (Environmental, Social, and Governance) Management Committee at the Korea Press Center in Taepyeong-ro, Seoul, marking the launch of the new committee.

The third committee newly appointed 19 CEOs from major domestic groups, including the top 10 conglomerates, as management committee members. The domestic affiliates of these 19 groups alone number 1,251 companies. The committee members will serve a two-year term, and the "ESG Working Committee," comprised of heads of ESG departments from each company under the committee, will operate on a regular basis.

The committee plans to strengthen on-site ESG management to help establish a culture of "corporate-led autonomous ESG management" throughout the business sector. At the meeting, participants reaffirmed the joint declaration adopted by the second committee in 2023 and agreed to regularly review on-site activities and enhance self-implementation to better respond to global regulatory volatility. The joint declaration adopted by the second committee includes six activity goals: reducing greenhouse gas emissions, promoting a circular economy, complying with human rights and labor standards, expanding voluntary due diligence, and increasing autonomous disclosure, among others.

In addition, the committee decided to institutionalize "policy dialogues" with key stakeholders, including relevant government ministries, to discuss ESG policy directions and on-site improvement tasks together. At the policy dialogue held that day, Won Jonghyun, Chair of the National Pension Fund’s Stewardship Responsibility Committee, attended and explained the principles of corporate governance and the direction of stewardship activities pursued by the National Pension Fund. Chair Won emphasized that, with the amendment of the Commercial Act clarifying the fiduciary duty of directors to shareholders, it is expected that the National Pension Fund will exercise its shareholder rights more actively in cases of shareholder interest infringement, and stressed the importance of strengthening communication between companies and shareholders.

Son Kyungshik, Chairman of the Korea Employers Federation and head of the committee, stated in his opening remarks, "From the end of last year until recently, the ESG management environment has been undergoing dramatic changes both domestically and internationally," adding, "As uncertainty grows, public-private cooperation is more necessary than ever."

It was pointed out that, while the United States is pursuing its national interests through tariffs and Europe is easing regulations to enhance corporate competitiveness, South Korea has been tightening corporate regulations since the inauguration of the new administration. Specifically mentioned were the amendment of the Commercial Act to expand the fiduciary duty of directors to shareholders, the mandatory cumulative voting system, the increase in the number of separately elected audit committee members, and the so-called "Yellow Envelope Act" (amendments to Articles 2 and 3 of the Trade Union and Labor Relations Adjustment Act), which is seen as threatening the industrial ecosystem between contractors and subcontractors.

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