Korean Air receives grade A for ESG from KCGS

Korean Air has received an “integrated A grade” for its ESG efforts from the nonprofit ESG rating agency Korea Corporate Governance Service.

The national flag carrier achieved the marks for the second year running, a recent ESG rating report by KCGS revealed.

When broken down by category, the airline received an A for corporate governance, an improvement from last year.

The higher score was thanks to the separation of the CEO and the board of directors, appointment of a woman outside director and creation of an ESG committee consisting exclusively of outside directors.

In addition to governance, the airline’s social and environmental efforts also received an integrated grade of A.

Earlier this year, Korean Air partnered with leading petroleum and refinery company Hyundai Oilbank to adopt Sustainable Aviation Fuel.

The cooperation marks the airline’s latest environmental efforts.

Korean Air said at the time of the announcement that it hopes to counter climate change caused by the aviation industry through the use of SAF and help commercialize it.

SAF, which is made up of grains, plants, algae and animal fats, can reduce a flight’s carbon emissions by up to 80 percent.

In September, it teamed up with SK Energy to adopt carbon-neutral jet fuel and help fight climate change.

Under the partnership, the airline announced it would purchase a month’s worth of carbon-neutral jet fuel for domestic flights departing from Jeju and Cheongju, North Chungcheong Province.

In July, it also issued ESG bonds to raise funds for its environmentally and socially responsible investments including plans to introduce Boeing 787-10s as early as next year.

This new aircraft has 25 percent higher fuel efficiency per seat and emits 25 percent less carbon emissions than similar aircraft.

The airline also actively took part in humanitarian transport missions including shipping COVID-19 vaccines and medical supplies as part of its social corporate responsibility.

By Yim Hyun-su (hyunsu@heraldcorp.com)