Financial Services Commission Approves Amendment to Disclosure Regulations on Serious Industrial Accidents
On October 1, the Financial Services Commission announced that it had approved an amendment to the Korea Exchange disclosure regulations to introduce ad hoc disclosure requirements related to serious industrial accidents, as part of efforts to strengthen financial risk management associated with such incidents.
First, the ESG rating agency guidance was revised to explicitly require that the occurrence of serious industrial accidents be reflected in ESG evaluations. The ESG Rating Agency Council must now specify that major incidents, including serious industrial accidents, are incorporated into their evaluation frameworks. This aims to shift from the previous practice of voluntary reflection to a more clearly managed system.
Additionally, a new obligation was introduced for ESG rating agencies to make efforts to enhance evaluation quality and capabilities, in order to improve their expertise and objectivity. This is intended to ensure that major issues at companies are systematically reflected and to further increase trust in ESG ratings.
The Korea Exchange plans to regularly compare and analyze the compliance status of ESG rating agencies with the guidance, and will also verify adherence to the newly revised requirements.
The Financial Services Commission will establish a new ad hoc disclosure requirement for serious industrial accidents at listed companies on the Korea Exchange. Previously, listed companies were only required to make ad hoc disclosures to the Korea Exchange in cases of significant property damage, and there was no obligation to disclose serious industrial accidents that did not result in property loss.
The Financial Services Commission has decided that companies listed on the KOSPI, KOSDAQ, and KONEX markets must publicly disclose the details of any reports submitted to the Ministry of Employment and Labor regarding the occurrence and status of serious industrial accidents on the same day the report is filed. In addition, the Korea Exchange has approved partial amendments to its disclosure regulations for the KOSPI, KOSDAQ, and KONEX markets, requiring companies to disclose the facts and status on the same day a criminal court ruling is confirmed in cases of prosecution for violations of the Serious Accidents Punishment Act.
The revised regulations are scheduled to take effect on October 20, following guidance to listed companies from the Korea Exchange.
Finally, there are also plans to strengthen regular disclosures, such as business reports, in relation to serious industrial accidents. Currently, business reports and semi-annual reports disclose information on criminal and administrative measures related to serious industrial accidents, but do not include the actual occurrence of such incidents.
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