Mehrnaz Jalali discusses the SEC's continued trajectory on ESG disclosures despite recent criticism in The Legal Intelligencer. Environmental, social and governance (ESG) issues have steadily gained momentum in recent years becoming a key component in many of the world’s largest companies’ strategies and a popular metric by which potential investors evaluate investment opportunities.
Its no coincidence that the ESG phenomenon has also garnered the attention of the Securities and Exchange Commission (SEC). While the SEC has faced criticism for its failure to compel ESG specific disclosures as no new rule-making has been issued just yet, the agency has sent clear signals over the last few months to public companies and investors about its commitment to disclosures of ESG matters.
The precursor to the SEC’s actions, are a number of executive orders released from the Biden administration on Jan. 27, including the “Executive Order on Tackling the Climate Crisis at Home and Abroad.” The executive orders address the climate crisis by taking a “whole of government approach” elevating the issue to a national security and foreign policy priority. By establishing a White House Office of Domestic Climate Policy and a National Climate Task Force, the Biden administration intends to bring together federal agencies to jointly address climate change, as well as councils to address equity and environmental justice.
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