Aug. 16, 2022
Tuesday, August 16, 2022 Vanessa A. Countryman Secretary Securities and Exchange Commission 100 F Street NE Washington, DC 20549-1090 Subject: Stop Polluting Investment Companies from Deceiving the Public -- Environmental, Social, and Governance Disclosures for Investment Advisers and Investment Companies (File No: S7-17-22) To SEC Chair Gensler and SEC Commissioners: The Securities and Exchange Commission's new draft rules requiring asset managers to change their marketing of market mutual funds and Exchange-Traded Funds (ETFs) and their handling of Environmental, Social and Governance (ESG) matters are a critical step in fulfilling its mandate to protect investors and capital markets. Far too many asset managers engage in greenwashing and other deceptions about their handling of climate change and other ESG matters. Without improved fund labeling and more detailed disclosures, investors cannot tell if asset managers are living up to their commitments to achieve net-zero GHG emissions and other critical societal goals. This is unfair to the countless individuals like me seeking to protect their savings for the long term and expecting their asset manager to help rather than hinder the decarbonization of our economy. By setting a clear standard for asset managers to use fund labels and disclose data about their handling of climate risk and other ESG matters, this rule will provide investors with the vital information they need to protect their financial futures. I applaud the Commission for addressing major gaps in asset manager transparency and fulfilling its mission to protect investors. Although the proposed rules address many climate risk transparency problems, they are not strong enough on one in particular: requirements for disclosure of financed emissions. The Commission purports to require such disclosure but then indicates that disclosure of any emissions data not publicly available is not required. This sizable loophole would create incentives to not disclose and is totally unjustified given the availability of estimation methodologies. Leading organizations that assist asset managers with emission disclosures do not offer an escape hatch for non-publicly disclosed emissions. For example, the Partnership for Carbon Accounting Financials uses a data quality score to reflect how an asset manager is balancing the use of source data versus estimated emissions. To ensure that investors receive the climate risk data that they want and need, the final rules MUST establish a disclosure requirement for all financed emissions, with no loopholes. \"The ultimate test of a moral society is the kind of world that it leaves to its children.\" -- Dietrich Bonhoeffer I look forward to the SEC's continued efforts to provide transparency regarding asset manager actions on the threats that climate change and other ESG factors pose to the savings of investors across our economy. Thank you for your consideration of my comments. Please do NOT add my name to your mailing list. I will learn about future developments on this issue from other sources. Sincerely, Christopher Lish San Rafael, CA