The financial services arm of Korean conglomerate Samsung has committed to stop backing coal power.
In an announcement on Thursday (12 November), Samsung’s finance companies unveiled a plan to withdraw support for the coal industry, which is a major component of South Korea’s energy mix and contributor to premature deaths from air pollution in the world’s seventh biggest carbon emitter.
Samsung Life Insurance and Samsung Fire & Marine, which have been Korea’s biggest financiers of coal power for more than a decade, said they would no longer directly finance or invest in coal-fired power plants, as well as corporate bonds for building coal plants.
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Samsung Securities and Samsung Asset Management said they will introduce environmental, social, and governance (ESG) investment guidelines that exclude coal mining and power generation projects from next month.
A Samsung spokesperson said the conglomerate decided to bolster its coal phase-out policies to be a more environmentally and socially responsible company. “Through active engagement with stakeholders, we will pursue sustainable growth,” the spokesperson said.
The news emerges three months after Samsung’s construction arm, Samsung Construction & Trading (C&T), was targeted by green groups for participating in the controversial Vung Ang 2 coal project in Vietnam. Last month, Samsung C&T declared that it would exit the coal sector — but not before building Vung Ang 2 and the Gangneung facility in Korea.
Joojin Kim, the director of Korean environmental group Solutions For Our Climate, said he expected that this would not be the end of Samsung’s climate commitments, and noted that today’s announcement was light on detail.
“Samsung’s contribution to the climate crisis is still large, with many of Samsung’s affiliates still involved in the financing of operating coal power plants either through bond subscription or insurance underwriting. Samsung Heavy Industries is a leader in the global oil and gas industry as well. We hope Samsung’s step forward today leads to greater climate ambition,” he said.
The multi-billion dollar conglomerate’s declaration follows intense activist pressure and a commitment from the government in March to achieve net zero emissions by 2050.