The six major economic groups in South Korea have urged the government to consider the preparation time and implementation capabilities of companies as it pushes for the institutionalization of sustainability disclosures. While they agree on the necessity of such disclosures, they express concern that moving directly to legal requirements without a preliminary voluntary phase could increase the burden on businesses.
In a joint statement released on July 7, the economic groups noted, "According to the recent direction announced by the Financial Services Commission regarding the institutionalization of sustainability disclosures, discussions are underway to significantly revise the initial roadmap. This includes expanding the scope of disclosures and accelerating the timeline for companies with consolidated assets exceeding 10 trillion won, as well as implementing legal disclosures through amendments to the Capital Markets Act."
While the business community acknowledges the need and direction for sustainability disclosures, there are concerns about the prospect of implementing legal requirements without allowing companies to build their disclosure capabilities through a voluntary phase.
The economic groups stated, "There are voices of concern about whether the acceptance and implementation capabilities of companies can be sufficiently considered during the finalization and announcement of the roadmap."
They emphasized that sustainability disclosures require significant time and resources for data collection, certification, and the training of specialized personnel across the supply chain. They pointed out that since much of the disclosure data will be filled with predictive and estimated information, the immediate implementation of legal disclosures could increase legal risks due to uncertainties.
The economic groups called for comprehensive implementation support measures, including sufficient liability protections and the establishment of disclosure infrastructure and guidelines. They expressed hope that the government and the business community would continue to communicate and collaborate to ensure that sustainability disclosures become a system that contributes to the competitiveness of domestic companies and the advancement of the capital market.
* This article has been translated by AI.
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