When pension fund investment meetings take up coal divestment, agreement usually begins with the year. A pledge to get it done by a certain year is easy to put into a sentence and hard to oppose. The National Pension Service's plan for implementing coal investment restrictions also follows that familiar order in obtaining the year 2030. But it is hard to say that climate-responsible investment is working simply because a year has been set.
It is confirmed that the implementation date for the coal investment restriction has been specified for the first time as 2030. It is also confirmed that the assets to which the restriction will apply amount to some 1,600 trillion won.
Parts that have yet to be filled in remain. How far the portfolio's greenhouse gas emissions will be cut once the restriction is in place, and what criteria will decide whether to keep supplying funds to companies moving from coal to other power sources, are blank. The first of these is the scale of reductions and the second is the transition finance criteria.
The substance of climate-responsible investment is determined by the size of the cuts and the criteria for identifying transition finance. Until those two items are filled in, 2030 stops at the outward form of a pledge.
The counterarguments are strong enough. That follow-up discussion moves only once the date is nailed down, that the scale and the criteria require technical review and take time, that an institution moving 1,600 trillion won delivers an unnecessary shock to the market if it puts out figures hastily. All three are grounded in the realities of fund management.
Even so, there are reasons to hold that the order should be changed. If the size of the cuts is blank, what and how much to sell and what to keep during the period remaining until 2030 scatters into the discretion of fund managers. Without transition finance criteria, room opens for every company that explains it is in the middle of reducing its coal share to be brought in as an exception. A pledge that has only a year is also hard to assess after the fact for whether it was carried out.
Setting up one object of comparison makes the debate clearer. What actually changed after large overseas pension funds declared coal divestment was what percentage of coal in revenue they took as the exclusion threshold and what documents they used to verify transition plans. It was not the timing of sales that changed. What should be asked of the National Pension Service is of the same kind.
The follow-up discussion containing the scale of reductions and the transition finance criteria is at a stage before confirmation. When its contents are released, the items to check narrow to three. What indicator the exclusion threshold was drawn with, whether the reduction target was set in absolute volume or in intensity against assets, and who reviews exceptions for companies in transition and on what cycle. If the year 2030 is connected to these three items, the pledge becomes an implementation plan, and if it is not connected, it remains a year.
