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National Pension Fund (NPS) Chairman Kim Sung-joo takes an oath before the National Assembly audit at the NPS headquarters in Jeonju, North Jeolla Province, Thursday. Yonhap |
By Park Jae-hyuk
The nation's pension fund has been criticized for expanding investment in "sin stocks," toxic humidifier sterilizer producers and Japanese companies involved in Japan's wartime slave labor, according to lawmakers, Thursday.
A report given by the National Pension Service (NPS) to Rep. Nam In-soon of the ruling Democratic Party of Korea (DPK) ahead of a National Assembly audit showed the pension fund's investments in Japanese companies connected to wartime forced labor rose to 1.52 trillion won ($1.2 billion) in June from 760 billion won in 2014.
As of the end of 2018, Toyota was the one that attracted the largest investments from the NPS, because the pension fund invested 289.6 billion won in the Japanese carmaker that used wartime forced labor in the past.
The NPS was also found to have held a 0.52 percent stake in Namura Shipbuilding, which is also accused of having forced Koreans into slave labor during the Japanese colonial rule.
Sin stocks, which refer to publicly traded companies involved in activities that are considered to be unethical, were among the beneficiaries of NPS investments.
As of the end of 2018, the NPS invested 2.1 trillion won and 2.4 trillion won respectively in Korean and foreign stocks related to alcohol, tobacco, gambling, adult entertainment and weapons.
"The lack of guidelines for responsible investment is the reason for growing investments in sin stocks and Japanese firms involved in wartime slave labor," Nam said. "The NPS and the Ministry of Health and Welfare supervising the pension fund should come up with advanced measures after collecting opinions from various sectors."
Rep. Chang Jung-sook of the minor opposition Bareunmirae Party criticized the NPS for increasing its investments in Oxy Reckitt Benckiser and SK Chemicals, both of which are responsible for the deadly humidifier disinfectant scandal.
Furthermore, the amount of investments by the NPS in companies shunned by Dutch and Norwegian pension funds reached 7.4 trillion won as of 2018.
The Netherlands, Norway, the United States and Canada have lists of unethical companies that are excluded from investment portfolios of their institutional investors.
"In order for the NPS to make responsible investments, it should draw up a list of immoral companies that should be excluded from its investment portfolio," Chang said.
Against this backdrop, a Time Research & Consulting survey of 1,011 adults showed 59.5 percent of the respondents answered the government should ban the NPS from investing in Japanese firms linked to wartime forced labor.
"Despite growing calls for the government to restrain the NPS from investing in Japanese war crime firms, the investment strategy of the NPS has never been changed," said Rep. Kim Kwang-soo of the minor opposition Democratic Peace Party, who asked the research firm to conduct the survey. "The NPS should set up a principle for investments in companies related to war crimes or those receiving public criticism."