N※N

South Korea Implements Mandatory Carbon Reporting for All Companies by 2026

62

  //media-entertainment.news-articles.net/content/ .. -carbon-reporting-for-all-companies-by-2026.html
  Published in Media and Entertainment on Wednesday, December 10th 2025 at 2:48 GMT by KIRO-TV

• 🞛 This publication is a summary or evaluation of another publication
• 🞛 This publication contains editorial commentary or bias from the source

2025-12-10 200 x 224 / 9159 Bytes

2025-12-10 224 x 224 / 9223 Bytes

2025-12-10 187 x 224 / 4423 Bytes

2025-12-10 224 x 224 / 11402 Bytes

South Korea Mandates Comprehensive Carbon Reporting for Businesses, Pushing for a Greener Economy
June 2025 – Based on a report by Kiro7 (https://www.kiro7.com/news/business/south-korea-require/3NPVHKOODM5SRKSZA6YYX5DC4A/)

South Korea’s government has rolled out a sweeping new regulation that will require every business—large or small—to disclose its greenhouse‑gas emissions and to adopt concrete reduction plans by 2026. The move, announced by the Ministry of Environment (MOE) and the Ministry of Trade, Industry & Energy (MOTIE), is part of Seoul’s broader strategy to meet its Paris‑Agreement targets and to cement the country’s reputation as a leader in sustainable industry.

1. What the Regulation Requires

• Mandatory Emission Reporting
  All companies with a workforce of 50 or more employees, as well as firms with annual revenues above KRW 5 billion (about USD 4 million), will need to submit an annual greenhouse‑gas (GHG) inventory that follows the GHG Protocol’s Scope 1, 2, and 3 categories.
  The reporting will be conducted via the MOE’s online portal, which will become operational in Q3 2025.

• Reduction Targets and Action Plans
  Companies must set science‑based targets (SBTs) for each of the three scopes, and submit an “Action Plan” that details specific measures, timelines, and cost estimates to reach those targets.
  The plan will be reviewed by an independent panel of environmental experts and must be updated annually.

• Verification and Penalties
  Third‑party verification will be required for all submissions.
  Penalties for non‑compliance include fines of up to KRW 500 million (roughly USD 400 000) and, in extreme cases, the suspension of business permits.

• Data Transparency for Investors
  The MOE will make all verified emission data publicly available on a dedicated “Green Business” dashboard. This is intended to aid investors, consumers, and the media in making informed decisions about the environmental performance of companies.

2. The Rationale Behind the Mandate

South Korea’s climate‑action roadmap—“Vision 2050”—calls for a 37 % reduction in carbon intensity by 2030 and net‑zero emissions by 2050. The new reporting requirement is designed to:

1. Improve Data Accuracy
   Beforehand, emissions data were largely self‑reported or collected through voluntary programs. The regulation creates a unified, standardized reporting framework.

2. Encourage Corporate Responsibility
   By making targets mandatory, companies will be incentivised to adopt renewable energy, improve energy efficiency, and shift to low‑carbon supply chains.

3. Align with International Standards
   The framework mirrors the EU’s Corporate Sustainability Reporting Directive (CSRD) and the Task Force on Climate‑Related Financial Disclosures (TCFD), positioning Korean firms for global ESG investors.

4. Support the “Green New Deal” Financing
   The Korean government is planning a multi‑trillion‑won green investment fund. Transparent reporting will help direct public funds to the most effective projects and avoid “greenwashing.”

3. Expected Impacts on Key Industries

• Manufacturing & Heavy Industry
  These sectors, which account for roughly 30 % of national CO₂ emissions, will face the biggest changes. Firms are expected to adopt digital twins and AI‑based predictive maintenance to reduce energy waste.

• Construction & Real Estate
  The real‑estate sector will be required to disclose Scope 3 emissions related to construction materials and building operations. Green building certifications like Korea Green Building (KGB) will see tighter integration.

• Technology & Software
  Although historically lower in Scope 1 emissions, tech firms’ digital services contribute significantly to Scope 3. They will need to benchmark cloud usage, data centre cooling, and supply chain impacts.

• SMEs
  The rule includes a grace period for small‑medium enterprises (SMEs) with fewer than 50 employees. Nevertheless, many SMEs plan to partner with local NGOs and the Korea Chamber of Commerce & Industry (KCCI) to develop cost‑effective reporting tools.

4. Corporate Reactions

• Positive
  Major conglomerates such as Hyundai Motor Group, Samsung Electronics, and POSCO have already announced internal targets that exceed the new legal requirements. They view the regulation as a chance to consolidate ESG credentials and unlock green financing.

• Cautious
  Some SME owners, however, have voiced concerns about the upfront costs of data collection and third‑party verification. A recent poll by the KCCI shows that 63 % of small firms are seeking government subsidies or low‑interest loans to cover compliance costs.

• Neutral
  The Korea Federation of Industries (KFI) acknowledges the benefits but urges a phased approach, suggesting that the first two years of the rule apply only to firms with annual revenues over KRW 10 billion.

5. International Context and Links

• Global Climate Goals
  The regulation aligns with the United Nations’ Sustainable Development Goal 13 (Climate Action) and the European Union’s Green Deal. It also mirrors the International Organization for Standardization’s ISO 14064 standard for GHG accounting.

• Useful Resources
  - Korea Ministry of Environment – Detailed guidance on emission accounting can be found at https://english.moe.go.kr/ (link provided by the Kiro7 article).
  - Korea Ministry of Trade, Industry & Energy – Offers a dashboard of national carbon targets: https://english.motie.go.kr/
  - Korea Green Building – Standards for low‑carbon construction: https://kgb.co.kr/
  - Korea Chamber of Commerce & Industry – SME support programs: https://kcci.or.kr/

• Related News
  The Kiro7 article also references an interview with the Minister of Environment, who emphasized the importance of transparency. A companion piece on The Korea Herald (https://www.koreaherald.com/) elaborates on how Korean companies are integrating AI for real‑time carbon monitoring.

6. What to Expect Next

• Implementation Timeline
  The regulation is slated to take effect on January 1, 2026. Companies will receive a “ready‑check” toolkit from the MOE in early 2025 to evaluate their current data infrastructure.

• Compliance Support
  The government plans to partner with universities and industry consortia to develop open‑source software for GHG inventory management. These tools will be made available through a national “Green Tech Hub” (https://greentechhub.kr/).

• Future Amendments
  The MOE has indicated that the rule will evolve. In 2027, the ministry plans to extend mandatory reporting to firms with revenues above KRW 3 billion and to include Scope 4 (indirect emissions from purchased goods) in the next revision.

7. Bottom Line

South Korea’s new mandatory carbon reporting law marks a decisive step toward a low‑carbon economy. By requiring transparent, verified emissions data from the country’s largest and most influential businesses, the government is not only meeting its own climate commitments but also signaling to investors and consumers that Korean companies are serious about sustainability. While the rule presents challenges—especially for SMEs in terms of costs and data management—the long‑term payoff could include access to green finance, stronger ESG ratings, and a competitive edge in a global market that increasingly values environmental stewardship.

In a world where climate risk is becoming a core part of corporate risk assessment, South Korea’s regulatory push could set a benchmark for other nations, reinforcing the country’s role as a leader in the transition to a sustainable future.