In just the past 12 months, investor demand for and company disclosure of information about, climate change risks, impacts, and opportunities has grown dramatically. Consequently, the SEC has been in discussions about whether climate change and certain ESG items should be disclosed. In May 2020, the SEC Investor Advisory Committee approved recommendations urging the Commission to begin an effort to update reporting requirements for issuers to include material, decision-useful environmental, social, and governance, or ESG factors. In December 2020, the ESG Subcommittee of the SEC Asset Management Advisory Committee issued a preliminary recommendation that the Commission require the adoption of standards by which corporate issuers disclose material ESG risks.  Finally, in March of 2021 Acting SEC Chair Allison Herren Lee published a note to solicit public input on climate change disclosures.  The information collected to be used to determine whether current disclosure rules are adequate and whether they should be made mandatory through modifications in disclosure requirements in Regulations S-K and S-X (20-F for FPIs).

There are numerous benefits for companies to start formulating or to continue refining their integrated reporting strategy, particularly to be ready when any part of ESG reporting becomes mandatory.  MZ Group built a comprehensive reporting and scoring platform, ESGiQ, that makes it easy to either start on your ESG reporting journey or enhance your current process.  ESGiQ gives 100% flexibility to adapt to any well-known standards (i.e. SASB, GRI, TCFD) or custom reporting metrics. It allows for multiple user modes to support data sharing with the board, investors, management, and ESG working groups, and it serves as a single source of truth for all reporting metrics and data files supporting those metrics.  The platform also aids in avoiding ”greenwashing” by zero-ing in on reporting material items that are important for corporate strategy.

For more information, please see the links below:

Public Input Welcomed on Climate Change Disclosures

Potential Recommendations of ESG Subcommittee (PDF)

MZ ESG iQ Platform