South Korea has moved a step closer to introducing mandatory sustainability disclosures aligned with global standards issued by the International Sustainability Standards Board. The country’s Financial Services Commission has launched a consultation on a national roadmap that would require large listed companies to report climate and sustainability data under newly finalized domestic standards.

The proposal positions South Korea alongside other major economies integrating ISSB frameworks into national regulatory systems, reinforcing the global shift toward standardized climate-related financial disclosures.

KSSB Standards Mirror ISSB Framework

The roadmap follows the release of new sustainability standards by the Korean Sustainability Standards Board. These include KSSB 1, covering general requirements for sustainability-related financial disclosures, and KSSB 2, focusing specifically on climate-related disclosures.

Both standards closely align with the ISSB’s IFRS S1 and IFRS S2 frameworks, which have emerged as the global baseline for investor-focused sustainability reporting. By mirroring ISSB architecture, South Korea aims to ensure comparability with disclosure regimes developing across Europe, the United Kingdom, Japan and other Asia-Pacific markets.

Read more: European Commission Unveils Industrial Accelerator Act To Boost Clean Manufacturing

Phased Implementation Beginning In 2028

Under the draft timeline, companies listed on the Korea Composite Stock Price Index with consolidated assets exceeding KRW 30 trillion, approximately $20.4 billion, would begin reporting sustainability information based on fiscal year 2027 data, with disclosures published in 2028.

One year later, the requirement would expand to firms with assets above KRW 10 trillion. Regulators have also indicated that smaller listed companies could eventually be included once reporting systems mature.

The phased rollout reflects an effort to balance investor demand for climate transparency with the operational complexity of collecting sustainability data, particularly in sectors such as electronics, automotive and heavy manufacturing that rely on extensive global value chains.

Climate First, Scope 3 Later

The proposed framework adopts a climate-first approach consistent with ISSB standards. Early disclosures will prioritize governance, risk management and climate-related financial impacts.

Scope 3 emissions reporting, often the most resource-intensive component of climate disclosure, will be delayed until fiscal year 2030. This extended transition period gives companies additional time to develop value chain data systems and supplier engagement processes.

The roadmap also includes transitional relief measures. Subsidiaries accounting for less than 10 percent of consolidated group assets would initially be exempt, and small firms within value chains would not be subject to immediate reporting requirements.

Explore OneStop ESG Marketplace: Regulation and Compliance

Gradual Assurance And Enforcement

Third-party assurance of sustainability disclosures would remain voluntary during the initial phase. Regulators have indicated that mandatory assurance could be introduced later in line with global developments and market readiness.

Enforcement will also be phased. Rather than immediate penalties, the Financial Services Commission plans to focus on guidance and capacity-building to help companies establish credible reporting systems.

Implications For Investors And Corporate Governance

For institutional investors, the introduction of standardized ISSB-aligned reporting among major KOSPI-listed firms would significantly improve comparability of climate risk, transition planning and governance structures across the Korean market.

For corporations, the roadmap signals that climate disclosure is becoming embedded within core financial reporting expectations. Sustainability information will increasingly sit alongside traditional financial metrics as a central element of corporate transparency.

The consultation period runs until March 31, 2026, with finalization expected in April. If adopted as proposed, South Korea would formally join the expanding group of jurisdictions embedding ISSB standards into domestic regulation, accelerating the global convergence of climate and sustainability reporting frameworks.

Subscribe to our newsletter for more insights, case studies, and ESG intelligence.

Explore ESG Solutions on our marketplace - OneStop ESG Marketplace.

Keep abreast of the top ESG Events on OneStop ESG Events.

OneStop ESG Educate: Your go-to source for top ESG courses and training programs tailored to your needs.

Stay informed with the latest insights on OneStop ESG News.

Discover meaningful career opportunities on OneStop ESG Jobs.