For Immediate Release: October 2, 2018
Contact: Jana Morgan, Advocacy & Campaigns Director
Investors Call on Securities and Exchange Commission to Require the Disclosure of Critical Environmental, Social, and Governance Information
Washington, D.C. - Today, investors representing more than $5 trillion in assets under management called on the Securities and Exchange Commission (SEC) to initiate a rulemaking to develop mandatory rules for public companies to disclose high quality environmental, social, and governance (ESG) risk information. Signatories include major institutional investors, such as the California Public Employees Retirement System (CalPERS), as well as unions, state treasurers, and securities law experts.
Many of America’s largest public companies already voluntarily disclose information related to ESG performance risks; however, this information is often not consistent or comparable across companies and industries. This new petition requests that the SEC create rules to regulate the scope, quality, completeness, consistency, and comparability of the voluntary disclosures.
“Today’s petition will come as no surprise to the SEC as it builds on more than a decade of initiatives seeking regulations to increase corporate transparency and accountability related to ESG disclosures, including climate risk reporting, political spending, gender pay ratio, human capital management, human rights, taxes and other important issues,” said Jana Morgan, director of advocacy and campaigns for the International Corporate Accountability Roundtable. “The SEC is perfectly positioned to act in response to the overwhelming support for long overdue regulations like those proposed today.”
Investors clearly consider ESG information to be of financially material value. The petition notes that investors worth $64.4 trillion of capital are committed to incorporating ESG factors into their investing and voting decisions, and as many as 65% of investors consider non-financial information like ESG factors relevant to their investments overall.
By standardizing what is currently an uncoordinated universe of ESG disclosures, the SEC could increase confidence in capital markets by providing more and higher quality information to investors to better assess risks and opportunities. Clarifying reporting requirements around ESG disclosures will also promote the competitiveness of U.S. capital markets and bring the U.S. into alignment with peer countries that have already enacted such requirements.
Notes to editors:
Read the full petition here.
Read this fact sheet for more information about why environmental, social, and governance disclosures are important to investors and the long-term health of corporations.