이 기사는 2021년 11월 05일 07:26 thebell 에 표출된 기사입니다.

South Korea’s Government Employees Pension Service (GEPS) has recently established a committee that oversees matters related to environmental, social and governance (ESG) matters within its board of directors, joining other South Korean institutions seeking to integrate ESG factors into their decision making processes, industry sources said on Wednesday.

“We created an ESG management committee and operating rules in order to enhance our ability to implement sustainability management and ESG-related policies,” the pension fund said.

The committee will be responsible for deliberating the board’s decisions and management issues related to ESG, advising the board on ESG initiatives and policies, and supporting matters related communications with external stakeholders.

The committee will have seven or less members consisting of standing and non-standing directors, who will be appointed by the pension fund’s chief executive. The committee’s meetings will be held semi-annually and frequently convened if necessary. Approvals require attendance of a majority of the committee’s all members and support from a majority of the members present.

The move comes after Teachers’ Pension set up a similar committee at the end of October. Teachers’ Pension also hired a consulting firm in June to review its management strategy including its ESG initiatives and roadmap.

An increasing emphasis on ESG by South Korean institutional investors such as pension funds and mutual-aid associations is accelerating ESG integration across the domestic private equity industry.

Limited partners have increasingly integrated ESG factors into their mandate-awarding processes.

Korea Development Bank (KDB) and Korea Growth Investment Corp asked investment firms to disclose their ESG policies and strategies when selecting funds to award the government-led New Deal mandates earlier this year. Korean Teachers' Credit Union and Teachers’ Pension also included ESG factors in their selection criteria when awarding private equity mandates this year.

Moreover, KDB recently initiated a process to score and monitor the ESG integration practices of private equity managers selected by the state-controlled lender as part of post-investment management.

GEPS had approximately 9.2 trillion won ($7.8 billion) in assets under management at the end of September this year, with exposure to alternative investments accounting for about 2 trillion won or 22% of the total assets. (Reporting by Hee-yeon Han)