On May 9, the U.S. Securities and Exchange Commission (“SEC”) announced that it will extend the public comment period on its proposed rules on climate-related disclosures by public companies. The comment period was scheduled to close on May 20, 2022, but given the “significant interest” that the amendments have drawn “from a wide breadth of investors, issuers, market participants, and other stakeholders,” the SEC extended the comment period to June 17, 2022. Indeed, the SEC has already received thousands of comments from individual investors, academics, climate activists, industry groups, professional associations, and corporate entities. Some herald the proposed rules as “a fantastic idea to inform potential investors of what their money will support,” while others express concern that such climate-related disclosures stray too far from the SEC’s mission and authority. Although the final text and effective date of the rule are still unclear, enhanced climate-related disclosures are a priority for the SEC and public companies likely will have to deal with them in the near future.

• Climate Change

On March 22, 2021, the SEC launched a new page on its website to collect agency actions and resources about climate and environmental, social, and governance (ESG) issues in investing. This is the latest in a series of initiatives by the Commission signaling that climate and ESG disclosures—that is, the information asset managers and public companies provide to investors about their ESG-related risks and opportunities—will take center stage as the Commission adapts to the priorities of the Biden administration. Investors increasingly look to a company’s ESG impact or whether a fund follows ESG criteria to inform their investing decisions. Similarly, many younger consumers rely upon ESG factors to guide their purchasing choices. The lack of a standardized ESG framework makes it difficult for investors and other stakeholders to make “apples to apples” evaluations of a company’s or fund’s ESG practices.

• Climate Change
• Environmental, Social, and Governance (ESG)