January. 4. 2022
The National Pension Service lags behind private finance companies in net zero efforts
|Environmental activists organize a rally outside the headquarters of the National Pension Service in Jeonju, North Jeolla province, to urge the state pension fund to stop its coal-related investments in this April file photo 2021. Yonhap|
By Park Jae-hyuk
The National Pension Service (NPS) and state-run financial institutions have remained passive on climate change prevention efforts throughout the past year, compared to private sector finance companies, according to a study by a national non-profit organization released Tuesday.
Solutions for Our Climate (SFOC) analysis of Korea’s top 100 financial institutions found that none of the country’s 14 public finance companies had pledged to achieve net zero emissions in their portfolio of assets in the country. ‘by 2050, nor has developed a specific plan to reduce carbon emissions.
“The NPS which manages over 900 trillion won ($ 750 billion) has a significant impact on the global financial market, but it did not declare its exit from coal until May 2021, without making specific plans.” , said Han Soo-youn, a researcher at SFOC. “Given the overwhelming size of the public pension fund he manages, his strategies are expected to have a significant impact on the domestic financial market, so he must take forward-looking measures.”
SFOC also criticized public lenders for deciding not to invest in new coal-fired power plant projects, without divesting existing coal-related companies in which they have already invested.
The Export and Import Bank of Korea and the Korea Trade Insurance Corp., both of which have led the financing of overseas coal-fired power plant projects, are not expected to make additional investments, according to the government’s statement to stop funding coal overseas, ”Han said. “However, they should set the standards for their investments in all coal-related industries. The Development Bank of Korea, which invests in the domestic market, should also set its own standards for coal output.”
The Korea Credit Guarantee Fund, the Korean Scientists and Engineers Mutual Aid Association, the Korea Federation of Community Credit Unions and the Korea Technology Finance Corporation have not even made any statements for their coal outflows, according to the report. SFOC.
Unlike public institutions, private financial companies have made various efforts to follow global standards.
Standard Chartered Bank Korea, Samsung Fire & Marine Insurance and Mirae Asset Securities were mentioned as the three institutions that have established criteria for excluding coal industries from their investments.
“Mirae Asset Securities has established advanced carbon neutrality strategies as it has expressed its intention to consider setting standards regarding its investments in oil and natural gas projects,” Han said. “Samsung Fire was the only non-life insurer that decided not to invest in companies where more than 30% of revenues came from coal production and mining. “
Subsidiaries of financial groups Shinhan and KB were recognized for presenting specific plans to reduce investments in high carbon companies from their asset portfolios.
By the end of 2030, Shinhan plans to reduce its investment in its asset portfolio by 38.6%, compared to the 2019 figure. KB is seeking to reduce its investments in harmful businesses by 33.3%. environment of its asset portfolio during the same period.
The SFOC, however, pointed out that Korea’s top 100 financial institutions are lagging behind in taking effective action to tackle climate change compared to their overseas counterparts, such as AXA in France, APG in the Netherlands and National Employment. Savings Trust in the UK.