South Korea Expands ESG Disclosure Rules; Over 3,000 Firms to Report by 2029

On July 8, South Korea's government and ruling party announced a significantly tightened ESG disclosure framework. Starting in 2029, 157 major companies (with consolidated assets above 5 trillion won) must file mandatory sustainability reports, alongside 3,014 subsidiaries, totaling 3,171 entities. Scope 3 emissions (supply chain carbon footprint) retain a three-year exemption, but the expanded reporting base brings the actual deadline forward to 2032, requiring measurements from 2030 onward.

Companies face infrastructure challenges, particularly in manufacturing-heavy South Korea's complex supply chains. The government plans safeguard mechanisms including broad liability exemptions for the first three years and a safe harbor provision for forward-looking statements and third-party data. However, uncertainty persists on intentional greenwashing liability and whether subsidiary data errors fall to parent or subsidiary responsibility. Support measures include Scope 3 guidelines for 15 export sectors and 1,000 lifecycle inventory datasets by 2028.