In a survey conducted by eight notable organizations, including the US Chamber of Commerce’s Center for Capital Markets Competitiveness (CMCC), Nasdaq, NAREIT, and the National Investor Relations Institute, to name a few, a total of 436 public companies provided information for analysis relating to climate change and ESG. Survey respondents vary widely in roles and across industries and market capitalization. Findings were collected with the objective of informing “policymakers as they consider the impacts that new mandates for climate change and other ESG disclosures would have on public companies and their shareholders.”
The survey discovered that over half of public companies are indeed increasing climate change disclosure information under Regulation S-K since the US Securities and Exchange Commission’s issuance of interpretive guidance on climate change disclosures in 2010. Approximately two-thirds of surveyed companies reported they communicate to shareholders on the subject, and just under half surveyed noted an increase in the types of details shared.
Separate from climate change, 61% of companies responding were “cautious about the term ‘ESG,’” deeming it subjective, and analysis further showed companies split on whether the SEC should designate just one ESG standard.
A large portion of respondents, 89%, expressed support for tailoring climate change and ESG disclosures for small issuers and the same percentage believes new requirements should be released in phases for all public companies.
The survey also took note of the number of companies that already disclose material information related to climate change and ESG, whether published in their CSR or elsewhere, like the company’s website. The total: 52%, and the main objective for publishing the information: for their shareholders. Unsurprisingly, it was found that the published information “varies widely,” from climate change mitigation strategies, to greenhouse gas emissions, to environmental policy, no two reports are alike. As such, an “overwhelming” 84% of those surveyed say SEC-adopted climate change disclosure rules “should be flexible,” and “reflect the differences between various industries.”
With these findings, the survey notes that the SEC should proceed cautiously with the “enormous task” in front of them with respect to climate change disclosure requirements.