U.S. Securities and Exchange Commission Stays Climate Disclosure Rule
On Thursday, April 4, 2024, the U.S. Securities and Exchange Commission (the Commission or SEC) issued an order staying its March 6, 2024, Final Rules — The Enhancement and Standardization of Climate-Related Disclosures for Investors, Rel. Nos. 33-11275, 34-99678 (Mar. 6, 2024), 89 Fed. Reg. 21,668 (Mar. 28, 2024). As discussed in detail in Sidley’s March 12, 2024, alert here, the Final Rules require domestic and foreign registrants to include extensive climate-related information in public securities filings.
Federal Court Upholds U.S. Department of Labor ESG Rule
On September 21, 2023, Judge Matthew J. Kacsmaryk of the U.S. District Court of the Northern District of Texas rejected a challenge by 26 states and upheld the U.S. Department of Labor (DOL) rule that permits fiduciaries of plans subject to the Employee Retirement Income Security Act of 1974 (ERISA) to consider environmental, social, or governance (ESG) considerations under certain circumstances when making investment decisions. By upholding the rule, the court rejected the states’ contention that by allowing ESG considerations, financial interests would be subordinate to nonpecuniary interests. Stakeholders interested in ESG should continue to track this ruling, which may be appealed.
The Enforcement Angle: Driving California Toward Carbon-Neutrality with Dr. Steven Cliff
Join Sidley for the Environmental Law Institute’s People Places Planet Podcast series, “The Enforcement Angle.” Through this series, Sidley partners discuss state and federal enforcement of environmental laws and regulations with senior enforcement officials and thought leaders on environmental enforcement in the United States and globally. The featured guests offer their insights into the challenging environmental issues facing corporations today.
The Enforcement Angle: The New Mexico Environment Department
Join Sidley for the Environmental Law Institute’s People Places Planet podcast series, “The Enforcement Angle.” Through this series, Sidley partners discuss state and federal enforcement of environmental laws and regulations with senior enforcement officials and thought leaders on environmental enforcement in the United States and globally. The featured guests offer their insights into the challenging environmental issues facing corporations today.
Extensive Climate Disclosure Requirements Proposed for Federal Contractors
On November 10, 2022, the Federal Acquisition Regulatory Council, composed of the Department of Defense, the General Services Administration, the National Aeronautics and Space Administration, and chaired by the Office of Federal Procurement Policy in the Office of Management and Budget, issued a proposed rule that would require certain federal contractors to disclose climate-related information to the System for Award Management (SAM) and, in certain instances, make such information publicly available on its website. (more…)
Best Practices For Auto Boards During Industry Revolution
The Nikola case stands at the intersection of several emerging risk areas in the automotive industry. For example, as regulators in the U.S. and European Union continue to ratchet up the pressure on climate change goals, and environmental, social and corporate governance, boards need to be extra careful about their companies’ commitments to going carbon neutral and the efficacy of electric vehicles.
That means putting clear plans and metrics in place to ensure appropriate follow-through and effective communications with investors so that they are well-informed about the caveats, risks and limitations.
EU Corporate Sustainability Reporting Directive — What Do UK- and U.S.- Headquartered Companies Need to Know?
Non–EU companies with a significant presence in the EU or with securities listed on an EU-regulated market will become subject to new EU rules on corporate sustainability disclosures (the Corporate Sustainability Reporting Directive, or CSRD). The text of the CSRD has now been agreed by the EU institutions.1 CSRD is expected to become EU law later this year. Once implemented into the national law of EU member states, its requirements will be phased in from 2024.
China Plans To Adopt ESG-Disclosure Framework Based on International Sustainability Standards Board Standards
In speaking at the recent Boao Asia Forum Annual Conference, Vice Chairman Fang Xinghai of the China Securities Regulatory Commission (CSRC) announced that the CSRC is preparing new reporting standards and would adopt the new disclosure rules prepared by the International Sustainability Standards Board (ISSB). (more…)
SEC Brings First Enforcement Action Over ESG Disclosures
In late April, the U.S. Securities and Exchange Commission (SEC) brought its first enforcement action over alleged false and misleading claims made in a mining company’s environmental, social, and governance (ESG) disclosures. The complaint relates to the 2019 collapse of the company’s dam that injured hundreds and released 12 million tons of mining waste into the environment. (more…)
U.S. Treasury’s Federal Insurance Office Eyes Climate Risk Factors in the Insurance Sector
In February 2022, the U.S. Department of the Treasury Federal Insurance Office (FIO) announced that it would be joining the Network of Central Banks and Supervisors for Greening the Financial System. FIO intends to address climate-related financial risks and their effects on the insurance sector. (more…)