U.S. SEC considers disclosure mandate for range of climate, human capital metrics

Investor groups have asked the agency for more corporate disclosures on climate change and human capital


WASHINGTON- The chair of the U.S. Securities and Exchange Commission (SEC) has asked staff to consider a public company disclosure mandate to include range of specific climate and human capital metrics based on importance to investors, he said on Wednesday.

Gary Gensler told a financial services industry audience during the annual London City Week that he has also asked staff to address companies that have made "forward-looking" climate commitments and have significant operations in foreign jurisdictions with required climate-related targets.

The remarks come after the nation's top market regulator closed its period of public consultation on agency disclosure mandates related to climate risk and human capital last week.

"I've asked staff to propose recommendations for the commission's consideration on human capital disclosure. This builds on past agency work and could include a number of metrics, such as workforce turnover, skills and development training, compensation, benefits, workforce demographics including diversity, and health and safety," Gensler said.

Gensler has previously said the agency rule will address human capital as it steps up environmental, social and governance (ESG) disclosure mandates. 

Wednesday's details provide the clearest preview, however, of what an agency rule would mandate when it is proposed, likely in October, according to its public agenda.

Investor groups have asked the agency for more corporate disclosures on climate change and human capital, while business interests have pushed back, a Reuters review of correspondence published by the regulator showed. 

"I'm really struck by the call for enhanced disclosures," Gensler said of the agency's more than 400 unique letters it received on the theme, adding that he has also asked staff to consider the ways that funds are marketing themselves to investors ... and what factors undergird those claims."

(Reporting by Katanga Johnson in Washington Additional reporting by Huw Jones in London Editing by David Goodman and Jonathan Oatis) ((Katanga.Johnson@thomsonreuters.com | 202-579-4165 | @kjspeakstruth))

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