The SEC Drafts Strategic Plan For Fiscal Years 2022-2026
On August 24, 2022, the SEC released its draft strategic plan for the fiscal years 2022 to 2026 and sought public comment on same. The three primary goals set forth in the plan include: (i) protecting working families against fraud, manipulation, and misconduct; (ii) developing and implementing a robust regulatory framework that keeps pace with evolving markets, business models, and technologies; and (iii) supporting a skilled workforce that is diverse, equitable, inclusive, and is fully equipped to advance agency objectives.
To achieve these goals, the SEC intends to use of market and industry data to prevent, detect, and prosecute improper behavior. The SEC also seeks to modernize design, delivery, and content of disclosures to investors so they can access consistent, comparable, and material information while making investment decisions.
These statements are very broad, but even at face value, the different focus of the SEC as compared to the last plan published in 2018 is clear. In 2018 the three primary
SEC Chair Gary Gensler Testifies To Senate Banking Committee
On September 15, 2022, SEC Chairman Gary Gensler gave his yearly testimony to the U.S. Senate Committee on Banking, Housing and Urban Affairs highlighting his priorities for the SEC. This year Mr. Gensler kept his testimony extremely short, allowing more time for questions and answers.
Last year, Chair Gensler gave lengthy testimony on his four key priorities: (i) market structure; (ii) predictive data analytics; (iii) issuers and issuer disclosure (including SPACs); and (iv) funds and investment management (see HERE).
This year Gensler again focused on market structure as a priority, noting that many aspects of the national market system rules have not been updated since 2005. Though not using the same topic subtitles as last year, SPACs, insider trading and investment funds remain top of list, as does crypto. Other priorities include shorting the settlement cycle to T+1, increasing central clearing in the treasury markets (rules were recently proposed), cybersecurity, and private funds.
Repeating his mantra, Chair
SEC Proposed Mandatory Climate Disclosure Rules – Part 8
On March 21, 2022, the SEC proposed rules that would require publicly reporting companies to include certain climate-related disclosures in their registration statements and periodic reports. Among other information, the new disclosures would require information about greenhouse gas emissions (GHG), climate-related risks that are reasonably likely to have a material impact on a company’s business, results of operations, or financial condition, and certain climate-related financial statement metrics in a note to its audited financial statements.
The proposed rules are enormous in scope, complexity, and ramifications with a polarizing comment response largely along party lines. The comment period ended June 17, 2022, after a relatively short, but necessary extension by the SEC. Despite the controversy, there is no doubt that the rules, even if somewhat modified, will be passed and public companies need to start preparing now. The recently published Reg Flex Agenda indicates we should see final rules in October 2022. The rules will require compliance with extraordinarily granular
SEC Proposed Mandatory Climate Disclosure Rules – Part 4
On March 21, 2022, the SEC proposed rules that would require publicly reporting companies to include certain climate-related disclosures in their registration statements and periodic reports. Among other information, the new disclosures would require information about greenhouse gas emissions (GHG), climate-related risks that are reasonably likely to have a material impact on a company’s business, results of operations, or financial condition, and certain climate-related financial statement metrics in a note to its audited financial statements.
The proposed rules, which are heady and complex, initially only allotted for a 39-day comment period. Considering the size (490-page rules release), scope, complexity and ramifications, the marketplace pushed back on such a short window. On May 9, 2022, the SEC extended the comment period through June 17, 2022, and all aspects of the industry are weighing in. Other than the small but powerful group of environmental activists and institutional investors that influenced the proposed rule, the vast majority of the commenters believe the
SEC Proposed Mandatory Climate Disclosure Rules – Part 2
On March 21, 2022, the SEC proposed rules that would require publicly reporting companies to include certain climate-related disclosures in their registration statements and periodic reports. Among other information, the new disclosures would require information about climate-related risks that are reasonably likely to have a material impact on a company’s business, results of operations, or financial condition, and certain climate-related financial statement metrics in a note to its audited financial statements.
The proposed rules would include a phase-in period for all registrants, with the compliance date dependent on the registrant’s filer status, and an additional phase-in period for Scope 3 emissions disclosure.
The proposed rules, which are heady and complex, initially only allotted for a 39-day comment period. Considering the size (490-page rules release), scope, complexity and ramifications, the marketplace pushed back on such a short window. On May 9, 2022, the SEC extended the comment period through June 17, 2022.
In last week’s blog, I provided some background and
SEC Proposed Mandatory Climate Disclosure Rules – Part 1
On March 21, 2022, the SEC proposed rules that would require publicly reporting companies to include certain climate related disclosures in their registration statements and periodic reports. Among other information, the new disclosures would require information about climate-related risks that are reasonably likely to have a material impact on a company’s business, results of operations, or financial condition, and certain climate-related financial statement metrics in a note to its audited financial statements.
The proposed rule changes would require a company to disclose information about (i) the company’s governance of climate-related risks and relevant risk management processes; (ii) how any climate-related risks identified by the company have had or are likely to have a material impact on its business and consolidated financial statements, including over the short, medium, or long term; (iii) how any identified climate-related risks have affected or are likely to affect the company’s strategy, business model, and outlook; and (iv) the impact of climate-related events (severe weather events
