Hana Financial Group on Wednesday unveiled its vision to go carbon neutral by 2050 to support the nation’s transition toward a sustainable economy.

Under the goal of achieving “coal-free finance,” the banking giant will launch an internal committee in charge of halting financial support -- including project financing and underwriting of bonds -- for businesses that have adverse environmental and social impacts, as early as during the first half of this year, officials said.

Under the carbon neutrality vision, the group also plans to adopt a global environmental, social and governance-related risk-management framework, known as the Equator Principles, they added. 

Hana Financial’s green initiative is in line with the Moon Jae-in administration’s drive to achieve carbon neutrality by 2050 by reducing the country’s reliance on fossil fuels.

Meanwhile, various procedures are underway to reinforce the group’s ESG management, referring to the policies of factoring in environmental, social and governance-related issues in business operations.

The group has been developing its own version of the policymaking Financial Services Commission’s K-Taxonomy designed to help businesses and individuals to distinguish green and non-green industries or activities, while offering guidelines on green financing.

In June, it will publish a report on its risk response strategies for climate change as well as high-risk business sectors that require close attention, under the guidance of the Task Force on Climate-related Financial Disclosures -- a global industry-led initiative created by the Financial Stability Board in 2015 to encourage financial companies to voluntarily disclose climate-related risks to investors and lenders. 

The move came after Kim Jung-tai, the incumbent chairman of Hana Financial Group, announced the group’s focus on ESG management in his New Year’s message in January.

“Calls are mounting for corporate social responsibility. BlackRock, the world’s largest asset manager, even decided not to actively invest in companies generating revenues from coal-related projects. ESG values are no longer simple recommendations for businesses, but rather key global standards to follow,” Kim had said at the time. 

Meanwhile, Hana Financial is slated to hold a shareholders’ meeting on March 26 to confirm the appointment of Kim as the next president. Late last month, the group’s CEO nomination committee reappointed its current chairman to lead the group for another year, paving the way for him to serve four consecutive terms.

Kim, 69, joined Hana Bank as a founding member in 1992 and served key roles, including as Hana Bank CEO in 2008, before being elected as Hana Financial Group Chairman in March 2012. In recognition of his leadership that resulted in sound business performance, he was reappointed as the group’s chief in 2015 and 2018, respectively.

His fourth term will only be extended for a year, not three years, as the group’s age cap for the position is 70.

By Choi Jae-hee (cjh@heraldcorp.com)