ESG management is rapidly emerging as a criterion for evaluating corporate sustainability and social impact. When investing in a corporation, it becomes more important to decide on investment by evaluating its impact on society in addition to the aspect of profit-generating the company. Corporations with eco-friendly, ethical, and ideal governance are called blue-chip companies, and investing in companies that meet these requirements is considered an investment for future generations. In other words, consumption trends are changing from management activities that have focused on financial factors to paying attention to non-financial factors.

Reflecting this trend, companies with assets of 2 trillion Korean won or more will be required to disclose ESG information by 2025, and all listed companies will be required to disclose non-financial information by 2030. In addition, as non-financial risks increase and social demands for transparent disclosure increase, each company is establishing a separate organization dedicated to disclosure. In particular, in the process of mandating disclosure of ESG information, a matter to be examined in depth is how to ensure that companies disclose information about ESG truthfully and faithfully. In addition, companies should approach two ways to disclose truthfully and faithfully. First, disclosure items and standards should be clearly presented in a feasible way, and second, it is to actively prepare countermeasures against so-called poor disclosures, such as disclosure of false information, insufficient disclosure, and failure to comply with disclosure obligations. In addition, the reliability of disclosure information is a key requirement that determines the success or failure of the disclosure system in terms of providing non-financial information on the company to stakeholders such as investors so that investors can properly evaluate the company.

Since a lot of information about ESG has been disclosed sporadically according to individual laws and regulations, and the Capital Markets Act has already overhauled systems on corporate disclosure, it will be very meaningful to look at practical countermeasures against poor disclosure by reviewing these systems. From this point of view, it can be proposed as follows as a regulatory measure for poor disclosure under the Capital Markets Act. First, it is necessary to introduce a damage compensation regulation for non-disclosure under the Capital Markets Act, and second, it is necessary to recognize the right to claim compensation to all stakeholders related to disclosure such as employees, consumers, suppliers, and local communities. Third, it would be desirable to revise the materiality criteria under the current Capital Markets Act (especially when it comes to ESG information disclosure) to apply the double materiality criteria. Fourth, in the context of the application of the Display Advertising Act, it is desirable to focus on the truthfulness of the disclosed information because the entity is obligated to demonstrate the ‘acts of ESG information’ disclosed. Fifth, it is desirable to prepare for the introduction of third-party verification for ESG reports. Sixth, in order to secure the reliability of ESG disclosure information, it is necessary to introduce criminal and administrative sanctions currently applied to poor disclosures of the business reports.

Through the concrete implementation of the above proposals, companies will be able to secure the reliability of information on ESG, thereby dominating global competitiveness.

I. Introduction Recently, ESG [1] management is rapidly emerging as a criterion for evaluating a company’s sustainability and social impact. For example, when investing in a company in the past, investment was decided based on whether the company had successfully generated profits. However, in recent years, investment has been decided by evaluating the company’s impact on society in addition to the company’s profit-generating performance. In other words, a company that is ① eco-friendly, ② ethical, and ③ ideal governance structure is referred to as an excellent company, and investing in a company that meets these requirements is starting to be regarded as an investment for future generations [2]. Although this concept of ESG management is defined using various expressions, it can be defined as “ESG management is a management strategy to achieve corporate sustainability” by extracting and organizing the common contents among the various definitions of ESG concept. Here, 「sustainability」 is to meet the needs of current generations while keeping in mind the share of future generations [3]. To understand the concept of ESG more specifically, it is important to divide each element that makes up the ESG and examine the concept of each element. First of all, E (Environment) focuses on saving resources and energy along with the production of eco-friendly products [4]. Examples of management activities focusing on E (Environment) management include ① Declaring not to sell clothes that require 「dry cleaning」, which is the main culprit of environmental pollution in the fashion industry, ② the food and beverage industry that uses paper straws instead of plastic straws, ③ the delivery company that announced that it would use multi-use containers instead of disposable containers, ④ the electronic product manufacturer that produces electronic products by converting them to low-power or eco-friendly energy. Details of such E management include climate change, carbon emissions, air and water pollution, biodiversity, water scarcity, waste management, animal and plant protection, land use, renewable energy, raw material mining, and environmental amendments. In short, E management is based on the purpose that a company can help society if it develops eco-friendly management activities. The first ESG management was born with a focus on E. However, there is a tendency that the center of gravity is gradually shifting to Social. This social management focuses on solving social problems [5]. In other words, it focuses on management that recognizes diversity and coexists with the disabled without hesitation. For example, efforts such as developing imaging technology [6] that can be viewed by low-visibility or the visually impaired, marking [continua..]