At a recent conference, Securities and Exchange Commission Chair Gary Gensler gave wide-ranging remarks addressing market structure issues, LIBOR and other rates, and the Commission's regulatory agenda.
Addressing regulatory initiatives relating to public company disclosures, Chair Gensler noted he has asked the Staff to put together recommendations on mandatory company disclosures on climate risk and human capital. He also noted that investors would like disclosures that are consistent and that allow them to make comparisons among companies. The Chair noted he has asked for specific recommendations relating to governance, strategy, and risk management related to climate risk, as well as a range of specific metrics, such as greenhouse gas emissions, to determine those which are most relevant to investors. The Chair pointed to the over 400 comment letters the Commission has received regarding climate change disclosure. He noted that he has asked the Staff, as well, to consider how funds that purport to focus on ESG are carrying out their investment objectives. On human capital disclosures, the Chair recognized that the Staff is considering a number of possible metrics including workforce turnover, skills and development training, compensation, benefits, and workforce demographics including diversity, and health and safety.
Chair Gensler also discussed the Commission's plans for modernizing the rules related to ownership reporting. He noted that the rules relating to reporting beneficial ownership have not been updated since the late 1960s and connected this to the Archegos collapse, which may be tenuous. In any event, he indicated that revisions to the Section 13 and Section 16 ownership reporting rules are contemplated, as well as updates to reporting of derivatives positions and greater transparency relating to short selling activity.
See the text of his complete remarks here.
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