Bill calls for new ESG disclosure requirements in the Securities Exchange Act of 1934 and formation of a Sustainable Finance Advisory Committee.
On September 20, 2019, the US House Financial Services Committee passed H.R. 4329, the ESG Disclosure Simplification Act of 2019. The bill formed part of a suite of bills addressing environmental, social, and governance (ESG) disclosures that were the subject of hearings in the House Financial Services Committee in July, as discussed in this blog post. While unlikely to become law under the current administration, the bill’s passage in the House Committee reflects the continuing drumbeat for reporting companies to issue additional ESG disclosures.
Overview of the Bill
The bill would amend the Securities Exchange Act to require issuers to provide disclosures in their proxy statements describing the link between ESG metrics and the issuer’s long-term business strategy, as well as the process used to determine such impacts. The bill would also require the Securities and Exchange Commission (SEC) to adopt rules to compel issuers to disclose ESG metrics in any filing requiring audited financial statements. Continue Reading