On November 23, 2021, the International Organization of Securities Commissions (IOSCO) issued its “Environmental, Social and Governance (ESG) Ratings and Data Providers” final report in which IOSCO makes 10 recommendations related to the use of ESG ratings and data products in financial markets. In a new Legal Update, we discuss the report and
The US Securities and Exchange Commission’s (SEC) Division of Corporation Finance (Division) published a sample letter with comments that the Staff intends to issue to public companies regarding their climate change disclosures—or lack thereof—in SEC filings. As explained in a prior Mayer Brown post, Commissioner Lee, when she was Acting Chair of the SEC earlier this year, directed the Staff to increase its attention on the ways in which public companies implement the SEC’s 2010 Guidance Regarding Disclosure Related to Climate Change, which provides direction to companies regarding the SEC rules that may require disclosure about climate change, despite the fact that climate change is not explicitly referenced in the existing rules.
The SEC’s disclosure requirements are largely principles-based and may require different information from different companies, including climate change-related information.
On August 6, 2021, the US Securities and Exchange Commission (SEC) approved Nasdaq’s board diversity rule. Nasdaq originally proposed its rule in December 2020 and subsequently amended the proposal to reflect feedback submitted by commenters.
The rule requires Nasdaq-listed companies to have, or explain why they do not have, at least two diverse
On June 21, 2021, US financial regulators met with US President Joe Biden to discuss the US economy and update him on their efforts to address climate-related risks. According to the White House readout of the meeting, the regulators said “they were making steady progress” on implementing President Biden’s executive order on climate-related risk. The briefing follows last week’s passage of HR 1187, the Corporate Governance Improvement and Investor Protection Act, by the US House of Representatives1 by a vote of 215 to 214. HR 1187 would mandate that the SEC create an ESG disclosure regime for public companies and provides numerous statutory requirements for those disclosures, including climate-related disclosures. Although the bill is unlikely to become law due to expected opposition in the US Senate, which requires a 60-vote supermajority to pass legislation, the passage of the HR 1187 by the House – combined with President Biden’s focus on climate-related risks in his meeting with financial regulators – should bolster and influence the US Securities and Exchange Commission’s (SEC) ongoing development of new ESG disclosure requirements for US public companies under its existing statutory authorities. With regulators telling President Biden that they are “making steady progress,” new disclosure requirements for US public companies appear to be just around the corner.
Continue Reading The US Moving Toward Adopting New Climate Disclosures
In another step toward the integration of climate factors into the US corporate disclosure landscape, Acting Chair of the US Securities and Exchange Commission (SEC), Allison Herren Lee, issued a request for public input on climate change disclosures on March 15, 2021.
The request seeks input relating to 15 climate-related disclosure topics, including:
The past few weeks have seen a flurry of ESG-related announcements coming from the US Securities and Exchange Commission (SEC) Acting Chair and staff. The most recent press release announced that the SEC has created a Climate and ESG Task Force in the Division of Enforcement:
SEC registrants may be wondering if these announcements change their legal obligations and what actions they should take in response in order to ensure compliance. We discuss the implications for registrants in this Blog Post.
Continue Reading US SEC Announces the Creation of a Climate and ESG Task Force
On February 24, 2021, Acting Chair of the US Securities and Exchange Commission (SEC), Allison Herren Lee, announced that the agency will focus on public companies’ climate change disclosures as part of an effort to both assess current compliance with federal securities laws and develop new disclosure requirements for climate change.
Specifically, she
On December 16, 2020, the US Securities and Exchange Commission (SEC), by a 3-2 vote, adopted final rules requiring annual disclosure on Form SD of payments by SEC reporting companies engaged in the commercial development of oil, natural gas or minerals (resource extraction issuers) to certain governmental entities. The new rules should combat