SEC listens to investor ESG demands

US regulator commits to an "all agency" approach on ESG and climate

The environmental, social and governance (ESG) debate is quickly gaining momentum at the Securities and Exchange Commission (SEC) under President Biden’s administration.

In response to demand from investors, the US regulator has launched a dedicated page on its website to showcase its agency actions on climate and ESG investing, as well as provide latest information on these issues.

This is another step in the commission’s increased focus on the importance of ESG after it was accused of failing to encourage investor engagement on ESG and climate change under the Trump administration.

Allison Herren Lee, who became the SEC’s acting chair in January, said in a statement: “Our all-of-SEC approach looks at how climate and ESG intersect with our broader regulatory framework to get investors the information they need to plan for their financial future.”

The new ESG page will appear on the home page of SEC.gov and will be updated as the Commission continues to respond to investors.

Biden has made several appointments at the SEC, including Herren Lee, to help move the US’s ESG and climate policy closer towards its peers’ after he bought the country back into the Paris Agreement in February.

Commissioner Lee has started many ESG initiatives just two months into her role, including an increased scrutiny of companies’ ESG and climate change filings, and SEC examiners putting more focus on reviewing ESG practices of investment advisers. She also created an enforcement task force to ensure ESG disclosures and practices stack up properly. 

Herren Lee, who also appointed Satyam Khanna as the SEC’s senior policy adviser for climate change and ESG, said on 15 March that the regulator is seeking feedback on amending its disclosure rules with a view to requiring consistent, comparable, and reliable information on climate change. The SEC is also asking for views on the pros and cons of developing a single set of global standards applicable to all companies.