Korea is significantly expanding its planned mandatory sustainability reporting regime. The country’s Financial Services Commission (FSC) has finalized a roadmap that will extend the rules to major KOSPI-listed companies in stages from 2028. This article explains what changed, who it covers, the timeline, and how to prepare.
The roadmap does not apply to all Korean companies. It initially covers KOSPI-listed companies that meet consolidated-asset thresholds. Under the roadmap, companies with total consolidated assets of KRW 10 trillion or more will be required to report from 2028. The threshold falls to KRW 5 trillion or more in 2029.
Many regulators are pulling back. Korea is doing the reverse. So the message for finance and sustainability teams is clear. The scope of mandatory sustainability reporting is widening, and early preparation now pays off later.
What has Korea Announced About Mandatory Sustainability Reporting in Korea?
Korea’s FSC finalized a roadmap that significantly expands mandatory sustainability reporting for KOSPI-listed companies. It now covers far more entities than the draft plan did. The FSC said institutional investors had asked for a wider scope, since they value the disclosure data for investment decisions.
The roadmap represents the government’s final policy direction. However, amendments to the Financial Investment Services and Capital Markets Act and related rules are still required to put the regime into effect. The government intended to begin the legislative process in July 2026.
This move contrasts with developments in some other jurisdictions. The European Union has narrowed the scope of the CSRD by introducing higher employee and turnover thresholds. Meanwhile, the US Securities and Exchange Commission has proposed rescinding its federal climate-disclosure rules. Korea, by comparison, has widened the scope of its planned regime.
Key Highlights
First reporting wave. KOSPI-listed companies with total consolidated assets of KRW 10 trillion or more will be required to report first, starting in 2028 on FY2027 information.
Rapid expansion. The threshold falls to KRW 5 trillion or more (about USD 3.4 billion) in 2029.
Estimated coverage. The FSC expects the regime to cover 291 entities, including affiliates, in 2028 and 3,171 in 2029.
Possible further expansion. Authorities may lower the threshold to KRW 2 trillion or more from 2030 after reviewing implementation.
ISSB-based standards. Based on the ISSB baseline, KSSB Standard No. 1 covers general requirements. KSSB Standard No. 2 covers climate-related disclosures.
Transitional provisions. Scope 3 reporting is postponed for three years for each category. Mandatory third-party verification begins in 2030.
Legislation pending. Amendments to the Financial Investment Services and Capital Markets Act and related rules are still required.
Who must comply, and when?
The rules apply to KOSPI-listed companies, not every Korean firm. Companies with total consolidated assets of KRW 10 trillion or more must report first, starting in 2028 on FY2027 information. The threshold then falls to KRW 5 trillion or more in 2029. According to the FSC’s estimates, the number of covered entities, including affiliates, increases more than tenfold between 2028 and 2029, from 291 to 3,171.
The earlier draft proposed beginning in 2028 with KOSPI-listed companies holding total consolidated assets of KRW 30 trillion or more. The final roadmap lowers the initial threshold to KRW 10 trillion or more. So the first reporting wave widens substantially compared with the original plan.
What relief does the roadmap give companies?
The FSC built several transitional reliefs into the plan. These give teams time to build the right systems. During the first three years of mandatory reporting, companies will generally be exempt from damages, administrative sanctions, and criminal penalties under the capital-markets law in relation to the content of their sustainability disclosures. However, intentional greenwashing will not be protected. The FSC says it can still lead to damages and administrative sanctions.
The roadmap also provides limited first-year relief for consolidated reporting. In a company’s first mandatory reporting year, it may exclude subsidiaries whose assets and sales each represent less than 10% on a consolidated basis.
Scope 3 reporting also gets a phased start. The FSC postpones Scope 3 emissions disclosure for three years for each reporting category. The KRW 10 trillion-or-more group starts Scope 3 from 2031. The KRW 5 trillion-or-more group starts from 2032. Businesses classified as small businesses under Korea’s Framework Act on Small and Medium Enterprises are exempt from Scope 3 if they are not high-carbon emitters.
Mandatory third-party verification is scheduled to begin in 2030. The detailed scope and provider requirements are still to be established.
Before the rules take effect, KOSPI-listed companies not yet within the mandatory scope will be encouraged to submit reports voluntarily through the Korea Exchange (KRX). The KRX will update its disclosure system to facilitate reports prepared under KSSB standards. This lets firms practice before their own deadline arrives.
Why does this matter for finance and sustainability teams?
Korea’s move signals a wider global trend. Investors want comparable, decision-useful data, and a growing number of jurisdictions are using or adapting the ISSB baseline. Even where one region eases rules, others tighten them. So a global company still faces rising mandatory sustainability reporting demands somewhere in its footprint.
This creates real pressure on data and process. Teams must gather emissions data, financial data, and governance data. They must map each figure to a standard. They must keep an audit trail for future verification. Manual, uncontrolled spreadsheets rarely survive this workload. They struggle with version chaos and weak controls.
The smarter path treats disclosure as a financial-reporting discipline. That means one source of truth, clear ownership, and controls you can prove. It also means the same rigor you already apply to financial statements. When you run it this way, new regimes become far easier to absorb.
How does EcoActive help you prepare for mandatory sustainability reporting?
EcoActive helps you meet mandatory sustainability reporting duties in Korea and every market you serve. It is an AI-native platform for unified financial and ESG disclosure management, and it acts as your system of record. Here is how it supports each stage of the journey.
ISSB-aligned by design. The platform maps your data to IFRS S1 and IFRS S2 concepts. Because KSSB standards are based on these, your Korea reports stay consistent with your global disclosures.
One controlled source of truth. EcoActive unifies financial and ESG data in one controlled system, so spreadsheets stop being your system of record. You can still upload Excel, Word, or PDF files as source documents, but every number now keeps a clear owner and a clear origin.
Agentic AI that does the heavy lifting. Native AI agents collect data, flag gaps, and draft disclosures. They save your team hours on repetitive tasks. This matters most as Scope 3 requirements approach.
Audit-ready from day one. The platform keeps a full audit trail on every figure. So when third-party verification starts in 2030, your evidence is already in place.
Built for voluntary practice runs. You can produce KSSB-aligned reports early and file them with the KRX on a voluntary basis. So you learn the process before your deadline lands.
EcoActive also connects disclosure to filing. The platform has built-in XBRL and iXBRL tagging, so your data flows from source to submission without rework.
Want to go deeper on process design? Explore our guidance on audit-ready financial and ESG reporting workflows. It shows how leading teams turn scattered data into controlled, defensible disclosure.
Frequently Asked Questions
Who must comply with mandatory sustainability reporting in Korea?
The rules apply to KOSPI-listed companies, not all Korean firms. Companies with total consolidated assets of KRW 10 trillion or more must report from 2028. The threshold falls to KRW 5 trillion or more in 2029. Authorities may consider KRW 2 trillion or more from 2030 after reviewing early practice.
When does mandatory sustainability reporting in Korea start?
Reporting is planned to begin in 2028 on FY2027 information for the largest KOSPI-listed companies. It expands to more firms in 2029. Mandatory third-party verification begins in 2030. Legislative amendments are still required before the requirements take effect.
How many companies will Korea’s sustainability reporting rules cover?
The FSC estimates that the regime will cover 291 companies, including affiliates, in 2028 and 3,171 companies, including affiliates, in 2029. Because these totals include affiliates, they should not be interpreted as the number of separately listed parent companies.
What standards does mandatory sustainability reporting in Korea follow?
Korea’s KSSB standards are based on the ISSB standards. KSSB Standard No. 1 addresses general requirements for sustainability-related disclosures. KSSB Standard No. 2 addresses climate-related disclosures. This supports comparability with the ISSB global baseline, though Korean rules may contain jurisdiction-specific provisions.
Do companies have to report Scope 3 emissions in Korea?
Not right away. Korea postpones Scope 3 emissions disclosure for three years for each reporting category. Businesses classified as small businesses under Korea’s Framework Act on Small and Medium Enterprises are exempt from Scope 3 if they are not high-carbon emitters.
The bottom line
Korea has sent a clear signal. Mandatory sustainability reporting is expanding, not shrinking. The FSC expects the regime to cover 3,171 entities, including affiliates, by 2029, and the threshold may fall further after that. So early preparation is a competitive advantage, not a cost.
Start now. Build one source of truth. Align to the ISSB baseline. Keep an audit trail from the first report. Then each new regime becomes a routine extension of a system you already trust.
Ready to simplify mandatory sustainability reporting across every market?
