Korean corporations are expanding their ESG (environment, social, and governance) management systems, but an assessment said substantive risk controls, such as for industrial accidents and data leaks, remain insufficient.
ESG rating agency Sustinvest on the 17th announced the results of its "second half 2025 ESG evaluation" of 1,299 Korean corporations.
In the evaluation, indicators for the management system in the social (S) institutional sector improved, while deductions due to industrial accidents and data breaches increased sharply.
The share of corporations holding certification for an occupational safety and health management system was 54.1%, up 15.5 percentage points (p) from a year earlier, and the share holding information security system certification also rose 8.8%p to 32.0%. Large corporations with assets of 2 trillion won or more posted high certification rates of 83.5% and 62.7%, respectively. The share of large corporations that conducted supply chain ESG evaluations also increased from 49.9% to 55.6%, showing an improved management system in appearance.
However, actual incidents increased instead. The number of deductions due to industrial accidents rose 68.2% from 88 last year to 148 this year. In particular, deduction cases at large corporations with 2 trillion won or more jumped from 74 to 132. Some corporations, including Hyundai E&C, Hyundai Motor, and POSCO E&C, had up to 60 points deducted due to accidents that occurred at headquarters and subsidiaries.
Ryu Young-jae, chief executive of Sustinvest, said, "Quantitative expansion of management systems does not immediately lead to performance improvement," and noted, "If focus is placed only on visible ESG, it creates problems that weaken the effectiveness of on-site safety management."
Ryu also said, "Industrial accidents and information protection are core ESG risks for corporations, so simply introducing management systems does not achieve sufficient prevention and control," and added, "Corporations should go beyond expanding quantitative performance disclosures and release specific operational information that demonstrates execution in the field."