Financial Services Commission (FSC) Supporting Green Finance Specialized MBA

Green growth is of primary interests for many countries. Nowadays, it has become a popular topic for many global conferences. Green finance is a new form of finance, which ranges from financial support for green growth to development of environment-considered financial derivatives and improvement of risk management methods. In fact, green finance has already caught attention from many countries. For example, in Britain and Australia, green mortgage, which gives interest rate discounts for houses with environmentally friendly facilities, is on the market, and in Canada, financial derivatives involving lower interest loans for less carbon dioxide emitting vehicles are sold. To take a corporate-level example, Barclays Capital has set up Emission Trading desks to provide such green finance services as Emission Trading brokerage, risk management using Emission Trading-related derivatives, and Emission Trading loans. Beside above instances, many other countries and companies are developing plans for green finance or already taking part in it.

Lee Ki-Su, President of Korea University, Chin Dong-Soo, Chairman of FSC, and Suh Nam-Pyo, President of KAIST (from left to right) signed the agreement on May 7, 2010

In line with this global trend, the Financial Services Commission (FSC) created Green Finance Specialized MBA support package to nurture Green Finance expertise thus improving Korea’s competitiveness in this field. The FSC has gone through selection process since March 2010, and Korea Advanced Institute of Science Technology (KAIST) and Korea University were chosen. On May 7^th, 2010, FSC, KAIST, and Korea University signed an agreement in which the FSC provides financial support (500 million won to KAIST and 400 million won to Korea University) by 2013, and two schools complete preparation of the new education course and begin to provide Green Finance Specialized MBA programs in the fall semester of 2010.

In accordance with the agreement, two schools will introduce a Green Finance-specialized course in their MBA. The schools are required to secure sufficient number of full-time professors, education board, and administrative organization to provide well-prepared education programs.  Students who complete this course will be awarded ‘Green Finance Specialized MBA Certificate’. The support fund from the FSC will be used for scholarships and expenses in education courses and faculty. In order to carefully monitor the support fund and maximize the effects of the support package, the two schools are required to evaluate their own programs during the first two years, and the FSC will reflect the evaluation results into the amount of support fund afterwards.

Under this guideline, KAIST will maintain its former basic courses in the Graduate School of Finance and add a green finance course to its curriculum. The Green Finance Track will allow maximum 30 students, and will be operated in four-quarter system, of which Green Finance credit requirement is 12 out of total 54 credits. On the other hand, Korea University established Green Finance track in its Finance MBA with maximum 40 students. In each of 6 modules, students are required to take one Green Finance subject (total 13 credits in all 6 modules).

KAIST Graduate School of Finance: http://kgsf.kaist.ac.kr/default.asp?LangFlag=eng

Korea University Business School: http://biz2.korea.ac.kr/

 Amid global economic turmoil, investing in green growth is said to be a great opportunity to overcome this crisis by promoting renewable energy and other environmentally friendly and energy efficient industries. As a result, the need for fostering Green Finance is being called for by many countries including Korea. In this regard, FSC’s support package for establishing Green Finance specialized MBA will be significant first steps for Korea, aiming to become a financial world leading country.