We have expanded the list of climate policies we assess company engagement with to incorporate land-use related policy, referring to legislative or regulatory measures to enhance and protect ecosystems and land where carbon is being stored. Assessments under this category are currently underweighted in terms of their contribution to the overall company metrics. This weighting will be progressively increased over the next 6 months.
We adjusted the terminology used to describe the queries running down the left-hand side of our scoring matrix and added additional explanatory text to the info-boxes. This has no impact on the scores and methodology. It has been done following user feedback to improve clarity.
Climate Policy Engagement Overview: The Korea Petrochemical Industry Association (KPIA) appears to have limited engagement with climate policy in South Korea. The association has expressed broadly negative positions on the need for drastic emissions reductions and policy mechanisms to respond to climate change. KPIA has engaged negatively with one specific climate regulation in South Korea – Korea Emissions Trading Scheme (K-ETS).
Top-line Messaging on Climate Policy: KPIA has communicated top-line messaging on climate change, but it is unclear whether the association fully supported the need for climate action and policy. In an interview with Aju Business Daily in February 2021, Moon Dong-joon, the Chairman of KPIA, appeared to support the 2050 carbon neutrality target, and asked for financial support from the South Korean government, such as investments in R&D. At the second meeting of the Net-zero Committee of the petrochemical industry in June 2021, Song Yu-jong, the Vice President of KPIA, also appeared to support government investments and incentives, but it was unclear whether the association supported increased regulations.
Engagement with Climate-Related Regulations: KPIA has limited but negative engagement on the K-ETS in South Korea, and has displayed a mixed position on South Korea’s raised ambition for the 2030 Nationally Determined Contribution (NDC) emissions targets. In June 2020, KPIA signed a joint proposal on the K-ETS with several Korean industry associations, stating opposition to reform of the K-ETS and stressing their concern about the industrial competitiveness of South Korean industries in the global market. In June 2020, KPIA also presented a negative position on the K-ETS, arguing that the reform of the K-ETS should be reconsidered to reduce burden on the Korean industries, by reducing the price of emission allowances price. In October 2021, KPIA stated an ambiguous position on the upgraded 2030 NDC of South Korea directly to the Ministry of Trade, Industry and Energy, highlighting that carbon neutrality would be a challenging task for the petrochemical industry and emphasizing the necessity of government support for industry in achieving this target.
Positioning on Energy Transition: KPIA appears to have minimal engagement with the transition of the energy mix. As reported by Aju Business Daily in February 2021, the president of KPIA, Moon Dong-joon, appeared to support increased use of bioenergy materials at the Net-Zero Committee of the petrochemical industry. According to Electronic Times article in April 2022, KPIA advocated for tariff exemptions on imported crude oil and fewer regulations on oil field projects.