Insights

Moving Capital to Alter Corporate Behavior

Executive Director Karl Chun Seung Yang Speaks on KoSIF

To understand the trajectory of ESG in South Korea, it is necessary to examine the foundational critical awareness that defined its inception. Since its establishment in 2007, the Korea Sustainability Investing Forum (KoSIF) has continuously expanded the discourse surrounding ESG and Socially Responsible Investment (SRI) in Korea, systematically translating these concepts into the language of institutions and markets.

In Part 1, we examined the current status and upcoming challenges of Korean ESG, mapping out the direction required for our future. In Part 2, we turn our gaze back to the starting line. Through the words of Executive Director Karl Chun Seung Yang, we look into the critical awareness from which KoSIF emerged and the strategic direction it has pursued over the years.

Key Topics Covered in This Article

• • The background behind encountering the themes of sustainability and responsible investment
• • The inception of KoSIF and its early-stage direction
• • KoSIF's strategic response and adaptation frameworks
• • KoSIF's vision ahead of its 20th anniversary
• • KoSIF’s role within Asian transition finance cooperation

    Q. Looking at your past experiences, your background in the democratization movement, corporate activities, and environmental business appears deeply interconnected. How did you encounter the themes of sustainability and responsible investment within that flow?

Since my youth, I have always dreamed of a world that is better for everyone to live in. To me, such a world closely resembles a society that is free of discrimination, fair, and lives in harmony with nature.

During my university years, I participated in the democratization movement, which led me to contemplate the social structure and the future of our community more deeply. My time spent in prison due to the democratization movement during this period allowed me to establish a few core principles for my life: to continuously contribute to building a democratic society, to remain solely responsible for my own livelihood, and to fulfill a social role without overextending my capabilities.

Afterward, I worked for a shipping company for a long time, observing the shifting tides of society at close quarters. After wrapping up my 18-year corporate career, I operated a waste management business named "Jihwan Tech." Through this enterprise, I realized that environmental issues are not isolated industrial concerns, but are structurally linked to the overarching energy and industrial matrix.

This realization prompted me to enroll in the Graduate School of Energy and Environment at Seoul National University of Science and Technology to study climate and energy policy. Immersing myself in climate change naturally led me to the concept of sustainability, which became the central thesis governing the latter half of my life. Throughout this process, I recognized that corporations and financial institutions could play a vital role in solving sustainability challenges. Coincidentally, "Socially Responsible Investment (SRI)"—which integrates corporate Environmental, Social, and Governance (ESG) factors into investment choices—was expanding across global markets. I felt a strong imperative to introduce this movement to South Korea.

After continuous discussions with like-minded individuals who shared this awareness, we founded the Korea Sustainability Investing Forum (KoSIF) in 2007.

The Logo of the Korea Sustainability Investing Forum (KoSIF)

    Q. I would love to hear more details. What was the specific critical awareness that led to the creation of KoSIF, and what was the blueprint during its early days?

KoSIF was not an organization created overnight; it grew out of a study group formed by individuals who shared a critical awareness regarding responsible investment and Corporate Social Responsibility (CSR).

Around 2004, the term "ESG" was starting to surface internationally, while "CSR" was gaining significant traction as a vital topic domestically. Subsequently, the UN-backed Principles for Responsible Investment (PRI) launched in 2006, and discussions surrounding SRI gradually grew more active.

Amidst these trends, about 40 of us who shared the same vision gathered and maintained a bi-weekly study group for roughly two years. As we studied international trends together, we built a shared consensus that South Korea urgently required a professional organization dedicated to pursuing sustainability.

At the time, CSR was the dominant narrative, but we believed that finance and investment should be utilized as the primary levers to drive corporate transformation. Rather than stopping at merely emphasizing corporate environmental and social responsibilities, our goal was to actively shift corporate behavior toward a sustainable direction through capital allocation. While this was a highly unfamiliar approach in Korea at the time, we judged it to be an indispensable path given the direction of global trends.

Thus, on April 3, 2007, the Korea Sustainability Investing Forum officially launched. By formally proclaiming ESG investment principles, KoSIF established itself as the nation's first civic organization to seriously put forward ESG finance.

    Q. You must have faced numerous difficulties during the early phase of the launch. How did you navigate and endure that period?

The mission that KoSIF consistently held from its inception was explicit:

"Let us move capital to change corporate behavior in a sustainable direction."

However, the process of persuading domestic financial institutions in Korea at that time was far from easy. Financial institutions viewed investments strongly through the lens of short-term returns, rather than treating ESG as a baseline for investment judgment. To make matters worse, the onset of the global financial crisis brought substantial hardships to our forum.

As we navigated that period, our forum carved out several distinct pillars of activity. First, we sought to connect KoSIF's core mission with the outside world through international networks and cooperation, thereby building credibility domestically. Starting with Hong Kong, we expanded exchanges with various responsible investment institutions in the United States, Australia, the United Kingdom, Germany, China, and Japan. In 2008, we were invited to an international conference hosted by US SIF, where I had the privilege of introducing the launch of KoSIF and our strategic focus directly to global SRI leaders.

From left: Lisa Woll (US SIF), Eugene Ellmen (Canada Social Investment Organization), Matt Christensen (Eurosif), Melissa Brown (ASrIA), and Karl Chun Seung Yang (KoSIF)

Another vital turning point was our cooperation with CDP. Because CDP operates by receiving authority from global financial institutions to collect corporate climate management data and provide it to investors, it was precisely aligned with the direction KoSIF pursued. This partnership became a cornerstone for KoSIF to establish public trust domestically. Since then, we have sustained cooperative ties with The Climate Group (which leads RE100 and EV100), the Partnership for Carbon Accounting Financials (PCAF) for calculating financed emissions, the Science Based Targets initiative (SBTi), EnergyTag (which leads real-time matching of renewable electricity), and the PRI.

Simultaneously, the forum shifted its weight toward supporting legislative and policy transformations. Considering the corporate culture in Korea at the time, we concluded that attempting to persuade individual corporations one by one had inherent limits. Therefore, we focused on influencing institutional changes by engaging with the National Assembly and the government. Through these efforts, we steadily contributed to legal and institutional improvements, including the 2017 amendment to the National Pension Act mandating the consideration of ESG in fund management, the amendment to the Electric Utility Act that enabled RE100, and various amendments to basic industrial laws and the Capital Markets Act related to ESG.

Sustained research and the publication of comprehensive reports also served as an essential pillar. By consistently publishing the Korea ESG Finance White Paper, the Fossil Fuel Finance White Paper, and various Scorecards, I believe we have effectively accumulated and systematized the sustainable finance discourse in Korea. I consider this to be a hallmark achievement unique to KoSIF.

By keeping our strategic focus clear even amidst crises, KoSIF has gradually earned recognition for its presence not only within Korean society but also internationally. However, I believe we cannot afford to stop here. Moving forward, we aim to further strengthen our research capabilities and grow into a leading think tank that offers practical alternatives to our society by collaborating broadly with corporations, financial institutions, the government, and civil society.

    Q. KoSIF will mark its 20th anniversary in 2027. Looking back at the past two decades, how are you shaping the vision for the future?

Looking back, the past 20 years was a period dedicated to introducing and expanding the concepts of responsible investment and ESG within Korean society. When we first initiated the forum, the term "ESG" itself was highly alien, but today it stands as a critical benchmark across corporate management, financial markets, and policy discussions. I find it deeply meaningful that our forum has played a defining role in that transformative process.

However, the next 20 years must move beyond simply expanding the reach of ESG; it must be a stage where we execute the actual transition of our economic system. Accordingly, we are reshaping the forum’s vision to realign with that imperative.

The objective we aspire to can be summarized in a single phrase: "To become South Korea’s premier ESG think tank." The think tank I envision is not an institution that merely cranks out research papers, but a knowledge platform that actively designs the transition to a sustainable economy and connects finance with industry.

To achieve this, we will reinforce three primary roles moving forward:

1. Policy and Institutional Research Function: As new economic rules governing ESG disclosure, climate finance, transition finance, and natural capital are taking shape at a rapid pace, the forum will intensify its think-tank role to contribute directly to policy research and institutional design.
2. A Bridging Platform Between Finance and Industry: Transforming into a sustainable economy cannot be achieved by the government or corporations in isolation. It is vital to forge an arena of cooperation that seamlessly fuses finance, industry, technology, and policy.
3. Nurturing a Knowledge and Talent Ecosystem: Moving forward, there will be an exponential demand for talent equipped to understand ESG and the sustainable economy. Cultivating South Korea’s ESG knowledge ecosystem through education, research, and international collaboration is a vital task ahead of us.

    Q. Linking back to the vision you mentioned, what kind of role do you foresee KoSIF playing on an Asian regional level?

Capitalizing on our 20th anniversary, I would like to propose a new international initiative: the "Asia Transition Finance Alliance."

I believe the absolute core task for the global climate transition currently lies in reshaping the industrial architecture of Asia. Asia serves as the manufacturing hub of the world, and it is concurrently a region with massive carbon emissions. Because industries such as steel, petrochemicals, cement, power generation, and shipping are heavily concentrated in Asia, realistically solving global climate issues requires a robust transition finance ecosystem tailored to support Asian industries.

In that respect, I see KoSIF taking a proactive role in building a cooperative platform at an Asian regional scale. For instance, we can establish an Asian transition finance network where major financial institutions and research bodies from South Korea, Japan, Singapore, Australia, and Indonesia participate jointly. Together, we can map out shared transition standards and data frameworks for pivotal sectors like steel, cement, and energy.

Furthermore, we can envision a platform that unearths vital transition projects—such as green hydrogen-based steelmaking, low-carbon cement, power grid system restructuring, and industrial decarbonization technologies—and directly links them with financial institutions and investors. If these efforts accumulate, it is entirely possible for Seoul to position itself as a critical hub for Asian transition finance cooperation.

Should this vision materialize, KoSIF will be able to play a far more active role within the movement that bridges sustainable finance with industrial restructuring across Asia.

Over the next 20 years, our forum will aspire to become Korea’s top ESG think tank while simultaneously acting as a platform that creates tangible connections and alternatives on the ground of Asian transition finance cooperation. Through this role, we aim to contribute to developing the Korean economy in a direction that simultaneously secures both sustainability and global competitiveness.

Over the past 20 years, KoSIF has dedicated itself to embedding responsible investment and ESG discourse into the fabric of Korean society. Moving forward, ensuring that this momentum translates into an actual transition of our economic system will become increasingly vital. KoSIF will contribute to this process as a think tank that organically bridges research, policy, finance, and industry.