Korea Corporate Governance Service, Osstem Implant ESG grade B→C

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The Korea Corporate Governance Service lowered the ESG (Environmental, Social and Governance) rating of Osstem Implant, which was embezzled worth 220 billion won, from B to C.

Korea Corporate Governance Service, one of Korea’s major ESG evaluation agencies, held an ESG rating committee on the 5th and announced on the 12th that it had downgraded the ESG ratings of 11 companies, including Osstem Implant, from B to C.

Regarding Osstem Implant, the Korea Corporate Governance Service said, “The internal control system did not work effectively due to an embezzlement case equivalent to 90% of the equity capital, so the grade for the G sector was downgraded from B to D, and the integrated grade were also downgraded,” he said.

The ESG rating given by the Korea Corporate Governance Service by evaluating listed companies every three months is divided into seven grades: S, A+, A, B+, B, C, and D. The ESG rating is used for socially responsible investment by institutional investors. This rating adjustment was made to reflect the ESG risks identified from the regular ESG ratings granted in October last year to January of this year. The second grade adjustment is scheduled for April this year.

In addition to Osstem Implant, the ESG integration grade of Korean special lectures fell from B to C, and the grades of Farmsco and Harim Holdings also fell from A to B+. As for the Korea Special Lecture, former CEO Jang Se-hyeon was convicted in the first instance for breach of trust worth 4 billion won, and Farmsco and Harim Holdings were given a correction order and fines imposed by the Fair Trade Commission.

There was no downgrade in the consolidated rating, but there were also companies with ratings downgraded in individual areas. In the E (environment) field, the grades of SK Hynix (A→B+) and Youngpoong (C→D) fell, and in the S (social) field, the grade of KT (A→B+) fell. In the G (governance structure) sector, the grades of Sunjin (B+→B), Hite Jinro (B+→B), Hite Jinro Holdings (B+→B), and Yesco Holdings (A→B+) were adjusted.

Reference-www.khan.co.kr

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