South Korea's National Pension Service Tracks KOSPI Market Cap Rankings Despite 100% Responsible Investment Claims

According to Yonhapnews on July 5, South Korea's National Pension Service claimed to pursue 100% responsible investment in domestic and overseas stocks, yet its domestic equity portfolio largely mirrors KOSPI (Korea Composite Stock Price Index) market capitalization rankings. Analysis by Gukmin Ilbo and the Climate Solution think tank shows Samsung Electronics maintained the top holding at 20% (2022), 23.3% (2023), and 16.7% (2024), followed by SK Hynix and LG Energy Solution in positions matching KOSPI weightings.

The fund's ESG rating system shows minimal enforcement. Among 973 domestic companies rated in 2024, only 5 (0.5%) received the lowest D-grade, and even D-rated firms remain eligible for investment—merely underweighted versus benchmark. The fund manages half its domestic holdings via external asset managers evaluated quarterly on returns, reducing pressure to prioritize ESG standards. By contrast, Norway's Government Pension Fund Global excludes stocks where coal-related revenue exceeds 30%, while the Netherlands' ABP pension fund divested €15 billion in fossil fuel producers in 2024.