Events Recap

Climate Transition Investment Seminar

On July 4, the Climate Transition Investment Seminar, sponsored by the Korea Sustainability Investing Forum (KoSIF) and co-hosted by AIGCC and MSCI, was held at Gran Seoul in Jongno, Seoul. This seminar is being held sequentially across Asian countries, including Korea, Singapore, Malaysia, Japan, India, and Taiwan. The event introduced key contents from the 2025 Status of Climate Transition for Asian Investors Report published by AIGCC, alongside discussions on investment strategies for climate change response and the future direction of transition finance.

The seminar began with presentations by Director Hee Eun Bae of AIGCC, Director Sun Kyung Kim of MSCI, and COO Tae Han Kim of KoSIF, followed by a panel discussion featuring five panelists, including Jong Hyun Won, Chairman of the Fiduciary Responsibility Committee at the National Pension Service Fund Management Committee, and Yong Hwan Choi, Head of the ESG Research Team at NH-Amundi Asset Management.

First, Director Hee Eun Bae of AIGCC delivered a presentation on "Transition Status of Asian Investors." AIGCC surveyed approximately 230 institutions across Asia to present the current state of climate responses, revealing that climate change is recognized in Asia as both a financial risk and an opportunity, with response capabilities gradually improving. Regarding expected stages in investors' climate action plans, Bae outlined five focus areas, governance, investment, corporate engagement, policy advocacy, and disclosure, emphasizing that strengthening climate governance serves as the core foundation for effectively integrating and responding to climate risks.

Bae concluded her presentation by recommending the Net Zero Investment Framework (NZIF) as a reference framework for investors when establishing transition plans.

Next, Director Sun Kyung Kim of MSCI presented the "Energy Transition Framework." Kim introduced the Energy Transition Framework developed by MSCI, a new evaluation framework designed to help investors quantify and prepare for transition risks. She emphasized that beyond traditional carbon footprint-centric evaluations, investors must comprehensively assess transition pressures and readiness based on factors with high industrial and geographical specificity to prepare for transition risks. This indicates that even among companies with identical carbon emissions, the nature and level of transition risk may vary depending on a country's regulatory or industrial structure.

Kim concluded her presentation by highlighting MSCI's solutions and practical use cases for responding to transition finance, stressing that companies must build climate solutions based on common data.

Subsequently, COO Tae Han Kim of KoSIF presented on "The Direction for Domestic Investors Aligned with Global Transition Finance Standards," highlighting the Special Act on Climate Finance introduced in the National Assembly in 2024 and the Transition Finance Guidelines scheduled for release by the Financial Supervisory Service in 2025 as major turning points. He pointed out that while major overseas institutions have already established core standards and implementation frameworks for transition finance, the concept and scope of transition finance remain unclear domestically. Citing KoSIF's 2023 Fossil Fuel Finance White Paper and ESG Finance White Paper, Kim emphasized the necessity to substantiate the definition and scope of transition finance in Korea.

Furthermore, Kim outlined four core tasks for discussion: corporate transition plan establishment, adoption of science-based targets, continuous monitoring of implementation levels, and concerns over lock-in effects from financial support for high-carbon industry transitions. Based on these tasks, he concluded by emphasizing that practical and sustained discussions are required domestically to establish clear transition finance criteria that align with international standards.

In the final session, a panel discussion moderated on real-world perspectives regarding transition finance featured Chairman Jong Hyun Won (National Pension Service Fund Management Committee), Team Head Yong Hwan Choi (NH-Amundi Asset Management), COO Tae Han Kim (KoSIF), Director Hee Eun Bae (AIGCC), and Director Sun Kyung Kim (MSCI). Discussions centered on difficulties in implementing domestic transition finance, the lack of policy consistency in advancing net-zero finance, case studies of transition strategies from overseas public pension funds and institutional investors, and structural limitations and challenges facing domestic institutions.

Following the discussion, panelists strongly resonated with the importance of domestic transition finance efforts. The seminar concluded with shared consensus that strengthening policy consistency, establishing practical standards, and enhancing execution capabilities represent key future priorities for building a sustainable climate response financial ecosystem, reinforcing the need for follow-up discussions.

This seminar provided a meaningful opportunity to review the challenges facing the execution of domestic transition finance while reflecting on strategic directions forward. KoSIF will continue to make utmost efforts to perform policy engagement, establishing clear standards, securing alignment in policy formulation, and strengthening financial institutions' execution capabilities, to drive substantive change in domestic transition finance.