Seal_of_the_United_States_Securities_and_Exchange_Commission.svgThe Securities Exchange Commission (SEC) requires disclosure relating to social and environmental performance if the information would be “material” to the reasonable investor. Climate change issues may need to be disclosed with respect to the costs of environmental compliance, material legal proceedings, risk factors, management’s discussion and analysis of financial conditions and results of operations, and physical impacts of climate change. But even broader disclosure on environmental, social, employee, and human rights issues is required by pending European Union legislation and various sustainability reporting, standards, and rating organizations like the Sustainability Accounting Standards Board.

The SEC has sought comments on which sustainability and public policy issues are important to informed voting decisions, whether to require line-item disclosures on such issues, and which sustainability reporting frameworks to consider in developing additional requirements. SEC appears likely to expand reporting beyond what is required by current guidance, and the scope of its expansion could have a significant impact on publicly-traded companies’ sustainability reporting practices. Watch here for updates on the release of new SEC guidance or regulations regarding environmental, social, and governance disclosures.

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Photo of Ali Nelson Ali Nelson

Ali has experience advising companies in connection with mining and mineral extraction, regulated transmission projects, coal-fired power plants, and renewable and clean energy projects. Since joining the firm in 2005, Ali has helped numerous companies address the environmental issues surrounding business and property

Ali has experience advising companies in connection with mining and mineral extraction, regulated transmission projects, coal-fired power plants, and renewable and clean energy projects. Since joining the firm in 2005, Ali has helped numerous companies address the environmental issues surrounding business and property transactions by performing due-diligence reviews of environmental records, assisting with the transfer of required permits, evaluating liability for pre-existing contamination, and drafting purchase and sale contracts.