Lecture summary: Just over a year ago, the US Securities and Exchange Commission (SEC) sought public comments on a bold and thoughtfully framed rule proposal for the enhancement and standardization of climate-related disclosure. It was a move that signaled to many that the US was finally responding to the global shift amongst investors and asset managers toward the integration of ESG data into fundamental value analysis. Today, however, as ESG issues in the US have become politically polarized and as litigation challenges loom large, the possibility of meaningful change appears more remote.
Now is therefore an ideal time to spotlight the new ESG disclosure requirements in the UK and EU and, against this backdrop, to refute the claim that ESG disclosure involves “major questions” that transcend the SEC’s longstanding and clear authority to impose new reporting requirements on publicly traded companies. The UK and EU experiences likewise provide valuable perspectives in connection with other hot-button issues in the US, including: closing the public-private disclosure gap, broadening the traditional concept of materiality, and imposing mandates that require real-time disclosure as opposed to disclosure primarily at periodic intervals.
Donna M. Nagy is the C. Ben Dutton Professor of Law at Indiana University Maurer School of Law in Bloomington, Indiana, USA. She teaches and writes in the areas of securities litigation, securities regulation, and corporations, and has served for eight years as the law school’s Executive Associate Dean. Her scholarship includes two co-authored books, one on the law of insider trading and a casebook on Securities Litigation, Enforcement, and Compliance. She has published extensively in distinguished law journals on matters including insider trading and fiduciary principles; securities disclosure and environmental, social, and governance (ESG) information; government officials and financial conflicts of interest; and securities enforcement remedies. She is also a frequent speaker on securities regulation and litigation topics at law schools and professional conferences. Professor Nagy is a member of the American Law Institute and served as a member of the National Adjudicatory Council of the Financial Industry Regulatory Authority (FINRA) and as an appointed member to the ABA Corporate Laws Committee. She began her teaching career in 1994, and prior to that, was an associate with Debevoise & Plimpton in Washington, D.C. She earned her law degree in 1989 from New York University School of Law and her BA in Political Science in 1986 from Vassar College.