Decision of the Board of Audit (in Korean).

On July 24, 2025, a group of 300 South Korean citizens filed a public interest audit request with Korea's Board of Audit and Inspection (BAI) pursuant to Article 4(1) of the BAI's Public Interest Audit Processing Regulations. Article 4(1) allows citizens to request an audit of the affairs of public institutions — including the duties of their affiliated public officials — where such affairs are deemed unlawful or improper. The request targeted the National Pension Service Fund Management Committee (FMC) and the National Pension Service (NPS), alleging that the FMC's December 19, 2024, resolution on coal investment restrictions was unlawful and contrary to the public interest. 

Specifically, the petitioners contended that the FMC: (i) selected the weakest of three options proposed in a 2022 research report — restricting investment only in companies where coal revenues exceed 50% of total sales, far below the international standard of 30%; (ii) added an unresearched five-year private engagement period before any investment restriction takes effect; (iii) deferred application to domestic assets until 2030; and (iv) failed to act on the research findings for over two years.The petitioners further alleged that, despite the FMC's own May 2021 coal-exit declaration, the NPS had significantly increased investments in coal-dependent companies — raising holdings in KEPCO bonds from approximately KRW 9 trillion to KRW 15 trillion, and increasing investments in major overseas fossil fuel companies (ExxonMobil, Shell, BP, Chevron, TotalEnergies) from approximately KRW 770 billion to KRW 4.2 trillion between 2020 and February 2024. 

On November 5, 2025, the BAI closed all five claims without proceeding to a full audit. Claims on the 50% threshold and the 2030 domestic implementation timeline were dismissed as important policy decisions made through a rational deliberative process, exempt from audit review. Claim on the absence of implementation guidelines was closed after the FMC adopted internal guidelines on September 30, 2025. Claim on the alleged failure to report or discuss the 2022 research findings for over two years was rejected on the grounds that the FMC had in fact conducted internal consultations through sub-committees and relevant agencies during that period. Finally, the claim on increased investments in coal-dependent companies after the 2021 coal-exit declaration was closed because a civil damages lawsuit raising the same issues (Kim Min et al. v. Kim Tae-Hyun et al.) had become final on July 12, 2025, rendering the matter a confirmed case excluded from audit review.

Public Interest Audit Request on NPS’s Coal Exclusion Policy

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Public Interest Audit Request on NPS’s Coal Exclusion Policy - decision

Filed

South Korea

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Policy instruments are techniques or tools used by governing authorities to promote certain policies in order to achieve predetermined goals. Put simply, instruments are how a government tries to achieve its goals, with this taxonomy being focused on national policy instruments.

Risk is the potential for adverse consequences resulting from the dynamic interplay between (climate-related) hazards, exposure, and vulnerability of affected human or ecological systems.

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Renewable energy means all forms of energy produced from renewable sources in a sustainable manner.

Fossil fuel is a generic term for non-renewable energy sources such as coal, fossil gas, and oil (including crude oil, and petroleum products), that can be used for electricity and heat generation. Fossil fuels are hydrocarbons formed from pressurised and heated organic material buried over millions of years.

Molecules in the atmosphere that play a key role in the greenhouse effect by trapping heat radiating from Earth’s surface.

Area of the economy in which actors engage in identical or related activities.

In human systems, the process of adjustment to actual or expected climate change and its effects, in order to moderate harm, increase resilience or exploit beneficial opportunities. In natural systems, the process of adjustment to actual climate change and its effects; human intervention may facilitate adjustment to expected climate change and its effects.

The management and allocation of funds, assets and investments to meet various objectives

A ban is a legal action that prevents the sale or supply of a product or service, or that recalls a product from the market. Examples are bans on SF6, greenwashing, fossil fuel advertisement or single-use plastics.

A target to reduce the prevalence of a greenhouse gas over a specific time frame

A commitment to balance GHG emissions with removal by a certain point in time, effectively reducing the net emissions to zero

Either money or something of monetary value is transferred between two or more organisations, people or countries.

Actions to reduce emissions in energy generation and supply.

Coal is a combustible sedimentary rock formed from carbonised plant matter, rich in carbon and hydrocarbons, and occurring in several main types including hard coal and brown coal.

Activities of industries that extract natural resources, such as mining, oil, and gas, for commercial use.

The activities of industries involved in the production, distribution, and sale of energy, including electricity, gas, and renewables.

This sector includes firms and individuals offering specialised expertise in fields such as law, accounting, consulting, science and engineering.

Activities of businesses and institutions that provide financial services and products to individuals and organisations.

On July 24, 2025, a group of 300 South Korean citizens filed a public interest audit request with Korea's Board of Audit and Inspection (BAI) pursuant to Article 4(1) of the BAI's Public Interest Audit Processing Regulations. Article 4(1) allows citizens to request an audit of the affairs of public institutions — including the duties of their affiliated public officials — where such affairs are deemed unlawful or improper. The request targeted the National Pension Service Fund Management Committee (FMC) and the National Pension Service (NPS), alleging that the FMC's December 19, 2024, resolution on coal investment restrictions was unlawful and contrary to the public interest. 

Specifically, the petitioners contended that the FMC: (i) selected the weakest of three options proposed in a 2022 research report — restricting investment only in companies where coal revenues exceed 50% of total sales, far below the international standard of 30%; (ii) added an unresearched five-year private engagement period before any investment restriction takes effect; (iii) deferred application to domestic assets until 2030; and (iv) failed to act on the research findings for over two years.The petitioners further alleged that, despite the FMC's own May 2021 coal-exit declaration, the NPS had significantly increased investments in coal-dependent companies — raising holdings in KEPCO bonds from approximately KRW 9 trillion to KRW 15 trillion, and increasing investments in major overseas fossil fuel companies (ExxonMobil, Shell, BP, Chevron, TotalEnergies) from approximately KRW 770 billion to KRW 4.2 trillion between 2020 and February 2024. 

On November 5, 2025, the BAI closed all five claims without proceeding to a full audit. Claims on the 50% threshold and the 2030 domestic implementation timeline were dismissed as important policy decisions made through a rational deliberative process, exempt from audit review. Claim on the absence of implementation guidelines was closed after the FMC adopted internal guidelines on September 30, 2025. Claim on the alleged failure to report or discuss the 2022 research findings for over two years was rejected on the grounds that the FMC had in fact conducted internal consultations through sub-committees and relevant agencies during that period. Finally, the claim on increased investments in coal-dependent companies after the 2021 coal-exit declaration was closed because a civil damages lawsuit raising the same issues (Kim Min et al. v. Kim Tae-Hyun et al.) had become final on July 12, 2025, rendering the matter a confirmed case excluded from audit review. 

Public Interest Audit Request on NPS’s Coal Exclusion Policy - decision

Target

Policy instrument

Renewable energy

Fossil fuel

Greenhouse gas

Economic sector

Finance