Jun. 07, 2021
Responding to SEC request for comments - Climate Disclosures As a active individual investor - unsolicited, I support of the following SEC regulatory statements below as pertaining to Acting Chair Allison Herron Lee’s public statement A Climate For Change Meeting Investor Demand for Climate and ESG Information https://www.sec.gov/news/speech/lee-climate-change Commissioner Hester M Peirce: https://www.sec.gov/news/public-statement/peirce-statement-staff-esg-risk-alert https://www.sec.gov/news/public-statement/rethinking-global-esg-metrics Commissioner Hester M Peirce and Elad L Roisman https://www.sec.gov/news/public-statement/peirce-roisman-statement-contingent-settlement-offers-021221 Commissioner Caroline A Crenshaw https://www.sec.gov/news/public-statement/crenshaw-amac-remarks-031921 “The ESG Subcommittee has recommended that the Commission require the adoption of standards for ESG disclosure. As you discuss the recommendation today, I’m interested in hearing from you specifically about what information should be disclosed about issuers and investment products, what information can and should be quantified and disclosed through metrics, what standards you think we should use and why” Above statement by Commissioner Crenshaw, I believe (1) indicates component composition of ‘investors’ who in turn represent “Investors Demand” characterised by Acting Chair Lee’s public statement above and (2) what information can and should be quantified and (2a) disclosed (1) Institutions/asset management parties et al, their fund issuance/registrations, business models, marketing and soliciting thereof; further composed of fiduciaries representing millions of unit holders and ERISA DOL funds - another matter (1a) Collateral are market co-participants of proxy advisors and many influence 501(c)(3) orgs and stakeholder collectives, supporting business influence groups, Chambers, etc, with interests - financial and otherwise - not necessarily/directly but tangentially tied to domestic capital markets and SEC regulations; and other 501(c)(3,4) by various proclamations of having or representing stakeholder interests Among the many (1a): The Centre For American Progress (CAP) and other independent nonprofit sustainability standards setting organisations i.e. SASB, CII (European counterparts) Aforementioned are represented by meetings with Kristina S. Wyatt Senior Counsel Division of Corporation Finance U.S. Securities and Exchange Commission April 20, 2021 - June 1st, 2021 Meetings with SEC Officials https://www.sec.gov/comments/climate-disclosure/cll12.htm I find the following SEC meetings below to be propitious and curious regarding Acting Chair Lee’s public statement above https://www.americanprogress.org/issues/economy/reports/2021/02/19/496015/secs-time-act/ https://www.americanprogress.org/press/advisory/2021/03/12/497131/event-advisory-sec-acting-chair-allison-herren-lee-speak-environmental-social-governance-regulations/ as well as testimony provided by Gary Gensler before the senate banking committee, emphasising the following principles terminologies: 1 - the reasonable investor 2 - proxy voting and investment decisions 3 - the courts and materiality 4 - economic analysis 5 - the total mix of information including Senator Richard Shelby (among his apparent interests) that asked Gensler to discuss the difference between “economic materiality” and what he called “political materiality.” Since, are the following SEC public statements relevant to the SEC’s manoeuvring approach to disclosures and its re-alignment of divisions under Enforcement https://www.sec.gov/news/press-release/2021-42 https://www.sec.gov/news/public-statement/lee-statement-empowering-enforcement-better-protect-investors https://www.sec.gov/news/public-statement/lee-statement-contingent-settlement-offers-021121 https://www.sec.gov/news/public-statement/corp-fin-proxy-rules-2021-06-01 (2) and (2a) Recently is Acting Commissioner Lee’s testimony regarding a “Duty to Disclose” https://www.sec.gov/news/speech/lee-living-material-world-052421 Acting Chair provides testimony regarding disclosures, materiality, aspects of principle vs prescriptive, citing 3 Myths and Misconceptions with additional context, of the absence or presence of a duty to disclose - illustrating context in part (and of telling irony), by using proxy advocacy proposals of political contributions (of concentrated groups, thresholds and narrow interests), concluding (Chair Lee): Where does this all leave us in the debate regarding climate and ESG disclosures? 1 - We must not operate under the false assumption that the securities laws already effectively elicit the information investors need. 2 - We must not be diverted by mistaken views regarding the SEC’s rule making authority. 3 - And we must not be persuaded to ignore scientific evidence or other decision-useful data on the grounds that it intersects with issues of political or social concern. While recognising that institutional parties and co-participants play a significant and important role in domestic capital markets, it seems curious that up to more recently on the one hand for example, institutional proxy voting disclosures have been difficult to ascertain and characterised as dubious, yet on the other, it is among this composition of ‘investors demanding’ as characterised by, a ‘prescriptive holistic approach’ to corporate disclosures. And, where a reasonable investor might ponder the proposition of SEC holism itself: Is the sum of the (debated and heretofore) unmeasurable intersectional parts greater than the sum of the formerly measurable material parts ? And, might this be of some dilemma rational in the debated dual disclosure mandate ? And, upon what sectors, market cap issues, constituents, indices ? I find it suspiciously interesting that the “All-Of-SEC” hastily, I believe, re-aligned itself under the SEC Division of Enforcement - Comply or Explain, Negotiate or Listing Procedures (i.e. NASDAC) and only in-passing mention of the business judgement rule by-passing the Evolution of Materiality in Case Law In conclusion: Before addressing Acting Chair Lee’s lengthly and detailed list of disclosure items and SEC division re-alignments and disclosure rule proposals, it would seem that working in the direction of completing all of Commissioner Crenshaw’s interests and concerns first - including the 2010 SEC guidance as Acting Chair Lee has requested - is most practical, honest and transparent in SEC rule making process and continuity of regulatory authority; doing so on behalf of all investors of all capital types of all market value styles and affiliations; and seriously considering the many dynamic market implications and distinctions as offered, for instance, by the technical insight of any number of experienced and practiced professors of securities law - SEC comment dated May 11th, 2021 As opposed to the near abandonment of principles approach and process leaving the markets with additional forward investment decision uncertainties under this currant SEC… regarding the inter-involved chain of propositions (above links) and concurrent sub-components serving as a distraction underlying the posed demand for a solution Bill Kiefer Un-solicited active Individual investor