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Korea’s KIC to adopt stewardship code, make first ESG-focused allocation

Korea Investment Corp. will embrace the local stewardship code for institutional investors by early next year and make its first ESG-focused equity allocation, a spokesman for the $110.8 billion sovereign wealth fund said.

Kiho Kwon, manager, institutional relations, confirmed in an email that Sung-Soo Eun, KIC chairman and CEO, announced last week that KIC will select a global equity manager specializing in environmental, social and governance-focused investing to manage an initial allocation of $300 million. He declined to provide further details.

While that $300 million would amount to less than 1% of the $45.6 billion in global equity KIC reported for its fiscal year ended Dec. 31, Mr. Kwon said the allocation should grow over time. "We will gradually increase allocations for ESG investing in consideration of global ESG trends, (the) market environment and investment performance," he said.

Likewise, Mr. Kwon said Seoul-based KIC "will apply the stewardship code" but again declined to provide further details of the plans in that regard.

Korea's stewardship code was unveiled at the close of 2016.