On August 15, 2022, the Committee submitted a comment letter to the Securities and Exchange Commission (the “SEC”) regarding its proposal on enhanced disclosure requirements with respect to environmental, social, and governance (“ESG”) investment practices by registered investment companies and investment advisers. The Committee supports the SEC’s goals of “promot[ing] consistent, comparable, reliable—and therefore decision useful” information about ESG investing strategies for investors. However, we are concerned that certain aspects of the Proposed Rule could frustrate the SEC’s goals of promoting useful information about ESG strategies and increase greenwashing — that is, the marketing of ESG strategies by exaggerating ESG practices or the extent to which investment products or services take ESG factors into account — rather than discourage it. The Committee’s letter describes these concerns and sets forth recommendations that we believe would better align the Proposed Rule with its intended goals.
The full letter is available here.