In Focus

SEC’s Regulatory Agenda Mirrors CII’s 2021 Priorities

The SEC on June 11 released a Spring 2021 rulemaking agenda that closely aligns with most of the advocacy priorities that CII set out for this year. Areas of alignment in the new agenda include plans for the SEC to: 1) revisit its 2020 rules and guidance on proxy voting and proxy advisors as well as rules that increased the thresholds for the submission and resubmission of shareholder proposals; 2) re-propose rules that would require national securities exchanges to adopt listing standards requiring listed companies to adopt certain incentive-based compensation claw back policies; 3) examine reforms  to address concerns about potential misuse of Rule 10b5-1 trading plans by company insiders; and 4) require corporate disclosures relating to climate change, human capital, board diversity and cybersecurity risk.

CII Supports SEC’s Climate Change Proposal, Offers Suggestions on Implementation

CII sent a letter June 11 to SEC Chair Gary Gensler supporting the commission’s proposal to require corporate climate change disclosure and offering suggestions on how best to implement the proposal. Tthe letter recommends that climate-related or other sustainability disclosure requirements include consideration of:

• Materiality to investment and voting decisions;
• depth, consistency and reliability of empirical evidence supporting the connection between the disclosure and long-term shareowner value;
• anticipated benefit to investors, taking into account the net cost of collection and reporting; and
• the prospect of substantially improving transparency, comparability, reliability and

Longer term, CII recommends that the SEC consider establishing criteria to identify an independent, private sector standard setter or setters to develop industry-specific sustainability standards and participate in reviewing, updating, improving and augmenting existing sustainability disclosures.