(Bloomberg) -- Financial institutions in South Korea, one of the world’s top funders of coal, have failed to keep up with their global peers in setting policies to exit the dirtiest fossil fuel, an activist group said.

Seoul-based non-profit Solutions for Our Climate assessed 100 companies, including banks, asset managers, securities firms and insurers in South Korea, and found 97 of them have insufficient policies in place to phase out coal. While nearly two-thirds have made pledges to exit coal, those actions are only related to new projects, the report showed. 

Financial companies across the globe are facing growing pressure to take action in addressing their role in financing climate change. Shareholders have been actively seeking changes to ensure banks’ investing practices don’t add to new fossil-fuel supplies. 

Global investors have been increasingly focused on South Korea’s financing of foreign coal developments. The Asian nation was the third-largest public financier of overseas coal projects among G20 countries between 2018 and 2020, ranking above the U.S. and India, Oil Change International said in a separate report last year. 

The SFOC review comes after South Korea joined almost 200 nations in a pledge to step up the fight against global warming last year, including ditching coal power and tackling emissions. The assessment shows the country may be struggling to translate its ambitious climate goals into a reality. 

“In spite of the call for OECD nations to end all coal use by 2030 to meet the world’s 1.5 degrees Celsius target, financial institutions in South Korea have not adopted tangible coal phase-out policies,” said Han Sooyoun, researcher at SFOC. “In line with actions taken by Korea’s global counterparts, we need to see faster divestments from the entire coal-related industry, from mining to manufacturing.” 

See also: South Korea Shuns Coal-Power Financing Amid Rising U.S. Pressure

The analysis looked at several criteria, including those related to coal-free investment and net-zero emissions by 2050. The report followed a “coal exit list,” which judged financial companies on whether they clearly defined coal companies and the scope of the industry, and if they established a threshold for investment exclusion.  

The results found that the companies focused largely on halting investment in new projects rather than developing a comprehensive coal-exit policy, while most net-zero commitments consisted of “words without action.” Only a handful of institutions have established detailed emissions reduction goals for their asset portfolios, the analysis said.

Standard Chartered Bank Korea Ltd. and Mirae Asset Securities Co. were two of the three companies in the report found to have developed effective policies. Samsung Fire & Marine Insurance Co., South Korea’s largest private coal financier in 2020, was the third company on the list, though the report cited a lack of transparency as some policies have not been made publicly available.

Samsung Fire said in a text response that it has publicly announced its plans to suspend coal financing and disclosed its climate policies in an ESG report last year.

Among the top five financial holding companies, four have pledged to achieve net-zero by 2050, but only Shinhan Financial Group Co. and KB Financial Group Inc. established concrete 2030 greenhouse gas reduction goals for their portfolios. Hana Financial Group Inc. and Woori Financial Group Inc. have yet to set detailed reduction targets.

A representative for Hana said the company is planning to announce its financed emission reduction target this year along with revised goals for each unit. Woori said it is working on a detailed policy to effectively lower emissions.

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