Environmental, social, and governance (ESG) values have moved from corporate buzzword to business necessity in Korea’s pharmaceutical industry.

Global investors and regulators increasingly demand high ESG standards, and Korean drugmakers are playing catch-up. As of mid-2024, only half of Korea’s top pharma and biotech companies had published sustainability reports -- the lowest disclosure rate among 15 major industries.

This is sounding alarms, as without robust ESG practices, firms risk losing international credibility, supply chain access, and investment opportunities. Mandatory ESG disclosures loom by 2030, adding urgency. In this context, 11 leading Korean pharma companies -- Dong-A ST, Celltrion, Ildong, SK biopharmaceuticals, Daewoong, GC, Samsung Biologics, SK bioscience, Boryung, Hanmi Pharmaceutical, and Yuhan – are striving to improve health outcomes and uphold sustainability having published their EGS reports this year. 

Healthcare is divided into B2B and B2C segments, and ESG matters more for B2B players because global clients place higher importance on B2B.

"Export-oriented Korean companies must prioritize ESG to maintain competitiveness," an ESG consultant said, asking not to be named. 

Environmental efforts

Korea’s pharma leaders increasingly recognize that protecting public health goes hand-in-hand with protecting the planet. All 11 firms have pledged climate action, most targeting carbon neutrality by 2050.

Notably, Yuhan Corp. has set science-based targets to cut greenhouse gas emissions 42 percent by 2030 (from a 2020 baseline) on the way to net-zero by mid-century.

SK biopharmaceuticals mapped a 2040 net-zero roadmap, while vaccine maker SK bioscience aims to achieve 100 percent renewable power (RE100) and carbon neutrality by 2035. These aggressive timelines align with SK Group’s wider decarbonization push.

Samsung Biologics, widely recognized as an ESG frontrunner, has maintained its Dow Jones Sustainability Index (DJSI) status for four consecutive years and earned EcoVadis' platinum rating in 2024, placing it among the top 1 percent globally. The company invests in renewable energy through power purchase agreements and measures product carbon footprints to help clients cut emissions. In 2024, it expanded these assessments and introduced nature capital disclosures aligned with TNFD guidelines to manage biodiversity risks.

“Carbon emissions management is the most critical ESG issue for manufacturing-driven healthcare companies,” the ESG expert said. “The ability to quantify and reduce emissions during production has become a key evaluation factor.”

GC Biopharma, a vaccine and plasma therapeutics producer, has also prioritized climate action. It is minimizing environmental impact “from drug development to distribution” through renewable energy adoption and eco-friendly processes. Its affiliates installed solar panels at manufacturing sites and switched to electric vehicles, cutting thousands of tons of CO₂ annually.

Celltrion has taken a life-cycle approach, completing product-level life cycle assessments (LCAs) on six products in 2024 and adopting compostable LDPE and chemically recycled PET packaging. Dong-A ST aims to cut emissions 30 percent from 2018 levels by 2030 and obtained ISO 50001 certification for energy management. Hanmi achieved ISO 14001 certification for both its Paltan Smart Plant and Pyeongtaek Bio Plant, reporting total greenhouse gas emissions of 183,711 tons in 2024.

Observers caution that while many companies set emissions targets, business growth can lead to higher absolute emissions -- raising concerns about superficial or “empty” ESG efforts.

Social responsibility: healthcare access and community engagement

Across ESG pillars, “S” carries unique weight in healthcare. Companies must not only develop drugs but also ensure equitable access and community benefits. 

Medical access is critical. ESG isn’t just about environmental footprints – ensuring marginalized groups can obtain care is equally vital.

Yuhan underscores closing treatment gaps for underserved patients. It has conducted clinical trials in diverse countries such as Ukraine and Malaysia, trained local physicians, and reported 176.1 billion won ($125.3 million) in five-year sales from therapies targeting unmet needs.

SK bioscience has forged global partnerships to improve vaccine access and expanded human rights due diligence across suppliers and local communities, while providing ESG training and risk audits to high-risk suppliers.

Community initiatives also stand out. Ildong earned recognition in 2024 under a national “Community Contribution” program for sustained philanthropy, including employee volunteer programs and a “walking donation” campaign supporting child abuse prevention.

Boryung launched the “Humans in Space” youth science contest in 2025 to inspire future biomedical researchers, even sponsoring winners to visit NASA. Employees also joined wildlife restoration efforts, including releasing rehabilitated storks in rural wetlands.

Samsung Biologics has reinforced its leadership in supply chain ethics, chairing the Sustainable Markets Initiative’s healthcare working group, while Celltrion’s “Cellove Market” project funded training for pathologists in Madagascar.

Industry experts noted that volunteer programs alone are not enough to define ESG success.

"Integrating core goals like product safety and access with medical and operational strategies strengthens credibility,” an ESG industry insider said.

Governance and ethics

Governance reform remains a key focus as pharma companies seek to match global ESG standards.

Ildong formed an ESG Committee as early as 2017, while most peers now have similar board-level oversight. Dong-A ST and Daewoong provide annual ESG updates to their boards, embedding executive accountability.

Yuhan, lauded for its professional, non-family-controlled management, topped Korea’s 2024 pharmaceutical sustainability index and won the Presidential Award at the 31st Corporate Innovation Awards. Its shareholder-friendly policies – including treasury share cancellations and dividend boosts – set it apart.

Samsung Biologics, after past accounting controversies, rebuilt trust via ISO 37301 compliance certification and PSCI membership, aligning its supply chain with ethical sourcing standards. Hanmi also earned ISO 37301 certification and an “A” KCGS rating, along with the Prime Minister’s Award for Sustainability Management.

Still, disclosure gaps persist. ESG reports vary in framework adherence, with some aligned to GRI, SASB, and TCFD, while others selectively disclose. 

Clear, standardized reporting and proactive risk communication will be critical and companies must show they are not reacting to crises but preventing them, experts noted.