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Korean Academic Society of Business Administration
[ Article ]
korean management review - Vol. 51, No. 5, pp.1323-1359
ISSN: 1226-1874 (Print)
Print publication date 31 Oct 2022
Received 01 Jul 2022 Revised 23 Aug 2022 Accepted 04 Sep 2022
DOI: https://doi.org/10.17287/kmr.2022.51.5.1323

Analysis on the Disclosure Integrity of Industry-specific Material ESG Information Disclosures of KOSPI Top 10 Firms

Jihyun Kim ; Soyoung Yoo
(First Author) Samil PricewaterhouseCoopers jkim921229@gmail.com
(Corresponding Author) KAIST College of Business, Management Engineering jesyyoo@kaist.ac.kr
KOSPI 상위 10개 기업의 산업별 중요성을 반영한 ESG 공시 충실성 연구


Copyright 2011 THE KOREAN ACADEMIC SOCIETY OF BUSINESS ADMINISTRATION
This is an open access article distributed under the terms of the Creative Commons Attribution License 4.0, which permits unrestricted, distribution, and reproduction in any medium, provided the original work is properly cited.

Abstract

Voluntary ESG disclosure practices are on the rise, oftentimes not fully embracing material ESG information which is in increasing demand in the capital market. This calls for the adoption of financially material ESG disclosure standards. The SASB standards, with their clear industry-specific material disclosure guidelines, are gaining legitimacy in Korean and global markets. This study examines the disclosure integrity of ESG disclosures of the Top 10 companies listed on the KOSPI in terms of industry-specific financial materiality. We construct a coverage-ratio-scoring-mechanism by mapping Bloomberg ESG Disclosure datasets and sustainability reports to the SASB standards. The results show that 1) during 2018-2020, KOSPI Top 10 firms showed advanced industry-specific material ESG disclosure both in quantity and quality and 2) readily-available Bloomberg ESG Disclosure datasets did not fully capture the scope of the SASB-related disclosure practices of the sample firms.

Keywords:

ESG disclosures, ESG investment, ESG ratings, the SASB, Sustainability reports

Acknowledgments

This research is supported by the Ministry of Environment’s Green Finance Professional Fostering Project Fund in 2022. The authors appreciate anonymous reviewers for providing valuable comments.

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∙ The author Jihyun Kim is currently a consultant at the Assurance ESG Platform Team, Samil PricewaterhouseCoopers. Jihyun Kim earned his master’s degree in Green Business and Policy at Korea Advanced Institute of Science and Technology (KAIST) College of Business. He received his bachelor’s degree in History from Korea University. His field of research focuses on ESG disclosures, integrated reporting, non-financial report auditing, etc.

∙ The author Soyoung Yoo is currently a visiting professor at KAIST College of Business. After graduating from Ewha Womans University, she obtained an MBA and a Ph.D. in Management Engineering from KAIST and performed management consulting, Valuation, and business feasibility assessment at PwC and Korea Ratings. Her major research areas include sustainability disclosure standards, green project evaluation, climate change risk analysis, and the relationship between environmental management and financial performance.