Financial Supervisory Service Gov. Yoon Suk-heun speaks at the FSS‘ joint international finance conference with Ewha Womans University, streamed online due to the coronavirus outbreak from the Ewha Campus Complex in Seoul, Tuesday. (Financial Supervisory Service)
The chief of South Korea’s financial watchdog on Tuesday urged private financial firms to disclose corporate environmental information, as part of a move to mitigate the detrimental effects of climate change on financial circles.
“Global consensus has arisen over the so-called ‘green finance’ and ‘sustainable financial services’ following a series of environmental improvement agreements,” Yoon Suk-heun, governor of the Financial Supervisory Service, said during the international finance conference held jointly by the FSS and Ewha Womans University in Seoul, citing the Sustainable Development Goals adopted by all United Nations member states in 2015 as well as the Paris agreement signed in the same year to strengthen the global response to climate change.
“Climate change is one of the most volatile and complex environmental problems, but if we keep neglecting the situation for this reason, the potential climate changes will pose even greater threats to the country’s financial ecosystem.”
Environmental information reporting would prompt continuous eco-friendly management and preliminary actions against environmental crisis in the local finance sector, which would consequently reduce climate-related risks on financial institutions’ business circumstances and increase their response capability to unexpected environmental problems, officials said.
Corporate environmental information comprise factors such as environmental protection policy, pollutant reduction or the environmental improvement agreement with the government agencies.
The financial authority plans to come up with guidelines regarding the disclosure of environmental information, Yoon added.
Meanwhile, preparatory procedures are underway to improve the supervisory body’s climate-related risk management program.
“(The FSS) will develop a stress testing tool for financial resilience to various climate risks and we will keep improving the system,” the FSS chief said.
“Korea issued a record $11.9 billion (13.8 trillion won) of environmental, social and governance, or ESG, bonds -- the largest in all of Asia -- for companies that comply with environmental, social and governance standards. Through the new taskforce on green finance set up in August, we will ramp up efforts to foster ESG investing, while promoting coherent policy regarding climate-related risks.”
By Choi Jae-hee (firstname.lastname@example.org