I recently provided insight for a Bloomberg Law article on how publicly traded companies can prepare to disclose their climate and environmental risks ahead of impending, new Securities and Exchange Commission (SEC) rules. While the SEC is moving quickly to formally announce these rules (as early as October 2022), I encouraged companies to prepare immediately and added that “climate risk is financial risk.”
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ESG Board Oversight Considerations: What Board Committee(s) Should Oversee ESG in the Current Environment?
A wide array of developments have significantly increased the focus by public companies on board and board committee oversight of environmental, social, and governance (ESG) issues in recent years. These developments have included the heightened consideration of institutional investors and proxy advisory firms on ESG board oversight and ESG considerations more generally, as well as various recent proposed rules and initiatives of the Securities and Exchange Commission (SEC) with respect to ESG matters, including the proposed climate rules issued by the SEC earlier this year. This post addresses issues and trends concerning whether the full board or particular board committees should be primarily responsible for oversight of ESG considerations.
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Reverberations Felt from SEC’s SPAC Proposal Even Before Rules Are Adopted
In March 2022, the Securities and Exchange Commission (SEC) proposed sweeping new rules to regulate the disclosures and liabilities associated special purpose acquisition companies (SPACs). The proposing release is available here. The proposals were aimed at enhancing disclosures and liabilities in connection with SPAC IPOs as well as the subsequent business combinations (De-SPAC Transactions) between SPACs and private operating companies.
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SEC Comment Letters to Companies Related to the Financial Impact of Russia-Ukraine Conflict
I recently offered insight for a Wall Street Journal article on the recent request from the Securities and Exchange Commission (SEC) that companies disclose the financial impact of the Russian-Ukraine conflict. Following the sanctions issued against Russia following its invasion of Ukraine, many companies grappled with the direct and indirect impacts. The SEC staff recently sent targeted letters to specific companies asking for more disclosure about the reasonably likely impacts from the Russia/Ukraine conflict, including financial impacts.
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Updates to Human Capital Disclosure Requirements
I recently authored an article highlighting the latest updates in human capital disclosure requirements for public companies since the Securities Exchange Commission (SEC) imposed new requirements in late 2020.
While public companies were historically only required to disclose their gross headcount as it relates to human capital, the 2020 changes added a broader requirement that companies include in their filings a description of their human capital resources, which includes any human capital measures or objectives that the company’s management team focuses on when running the business.
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[WEBINAR] What’s Next in ESG? Understanding the Proposed SEC Climate Change Disclosure Rules
After months of anticipation, on March 21, the U.S. Securities and Exchange Commission (SEC) voted 3:1 to propose climate change-related disclosure rules that would implement prescriptive climate-related disclosure requirements (which would be applicable for most public companies) in a wide array of climate-related areas, including with respect to governance, outlook, risk management, GHG emissions, climate-related targets and goals and financial statement disclosures. These proposed rules, which are intended to provide investors with consistent, comparable, and reliable climate-related information, would represent a major shift in the public company disclosure landscape and will require significant advance effort by public companies to facilitate compliance.
Join Bass, Berry & Sims and leading environmental, social and governance (ESG) thought leaders for the next installment in our ESG Impact Webinar series on Tuesday, May 24, 2022. Our panelists will share their experience and perspectives on what in-house counsel should consider as it relates to these proposed climate change disclosure rules. Discussion topics will include:
- Overview of the Proposed Rules.
- Required Disclosure under Regulation S-X.
- Required Disclosure under Regulation S-K.
- Phase-In Periods.
- Practical Takeaways and Next Steps.
A Summary of Certain Proxy Advisory Firm and Institutional Investor Board Diversity Policies
Institutional investors and proxy advisory firms continue developing and refining their policies regarding board diversity. While gender diversity on public company boards has been in focus for some time now, institutional investors and proxy advisory firms are also increasingly focusing on racial and ethnic diversity as part of their evolving approach to board diversity.
This post summarizes published board diversity policies of several institutional investors and proxy advisory firms into a singular resource for ease of reference. Below the initial breakdown is a description of specific policies concerning board diversity shareholder proposals.
2022 Proxy Season Guidance Related to Environmental Disclosures
Corporate Compliance Insights recently published an article I co-authored with Mai-Khoi Nguyen-Thanh, senior counsel of securities & governance at Boston Scientific, discussing the guidance from the 2022 proxy season related to environmental activity and disclosures.
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SEC Proposes New Cybersecurity Disclosure Requirements
On March 9, the Securities and Exchange Commission (SEC) proposed rules and amendments to enhance and standardize public companies’ disclosures regarding cybersecurity risk management, strategy, governance, and incident reporting.
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Insight on Disclosures Related to Climate Change Risks
I recently provided comments for an article in The Wall Street Journal about public company disclosures related to climate change risks. The Securities and Exchange Commission (SEC) is expected to announce a rule proposal on climate-related disclosures this year. In anticipation of that new proposal, the SEC has been sending comment letters to some companies asking for clarification about their climate change risks to help inform investors in their decision-making.
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