[2022 Asia ESG Forum] Lee Jae-hyuk: "Investment Funds Concentrate on Companies Like Amazon and Apple Known for Strong ESG"

Investors' Interest in Sustainability

Lee Jae-hyuk, head of the ESG Research Center at Korea University, is delivering the keynote speech at the 2022 Asia ESG Symposium held on the 4th at the Westin Chosun Hotel in Jung-gu, Seoul. Photo by Moon Ho-nam munonam@

[Asia Economy Reporter Choi Seoyoon] "The easiest way to explain corporate sustainability is to answer the question, ‘Which company would be good for our child to join?’"

Lee Jaehyuk, co-chairman of the International ESG (Environmental, Social, and Governance) Association, professor at Korea University Business School, and head of the ESG Research Center, delivered a keynote speech on the theme "ESG Opportunities in the Era of Complex Crises" at the ‘2022 Asia ESG Symposium’ held on the 4th at the Westin Chosun Hotel in Jung-gu, Seoul.

Professor Lee said, "Massive global investments are pouring into companies known for strong ESG practices such as Amazon, Facebook, Apple, Netflix, and Google," adding, "What investors are keenly interested in is sustainability."

However, he pointed out, "Unfortunately, in Korea, almost all companies approach ESG management in the same way," noting that it mainly focuses on general topics like consumer protection and innovative organizational culture improvement. He continued, "ESG management should look different for each company," and added, "Rather than covering all industries in ESG management evaluation indicators, companies should organize their business models and core competencies considering industry characteristics."

Professor Lee summarized recent trends in ESG management into three points: carbon reduction, diversity, and corporate sustainability due diligence. He explained, "European companies have long been concerned about carbon emissions, and the decoupling phenomenon between the economy and carbon emissions is already occurring." Regarding diversity, he said, "In the U.S., minorities and ethnic minorities make up about 43% of the total population, but in Korea, it is about 3%, making it difficult to meet quotas. The government needs to actively appeal to overseas credit rating agencies and other institutions."

Furthermore, he emphasized, "Sustainability of large companies’ partner firms, not just the large companies themselves, is important," and suggested, "The ultimate goal is to strengthen the entire ecosystem to which a specific company belongs by improving systems at the government level and providing many incentives."