A framework for aligning corporate strategy with climate goals and financial performance: a case study of South Korean companies

Purpose The climate change crisis is putting pressure on high-polluting companies to reduce greenhouse gas (GHG) emissions, which often requires significant investments. This study aims to propose a framework for companies to reduce their GHG emissions while enhancing their financial performance. Design/methodology/approach A case study approach examines four South Korean listed companies in high GHG-emission sectors, identifying their GHG reduction activities. Based on the findings, a new framework has been developed and applied to two other companies to test its practicability and effectiveness. Findings Enhanced corporate governance can align with sustainable goals of mitigating GHG emissions. Direct emissions (Scope 1) can be reduced by improving manufacturing processes, while indirect emissions (Scope 2) can be lowered with increased use of renewable energy. Cost reductions can be achieved through production optimization and using byproducts as inputs for other industries. Revenue growth can be achieved by promoting energy-efficient products, engaging customers in environmental initiatives and recycling materials. Originality/value This study introduces a comprehensive and practical framework for companies, particularly those in high-polluting sectors, to develop effective strategies that address climate change while improving financial outcomes. The framework presents a win-win approach for reducing GHG emissions and enhancing financial performance.