US ESG Regulatory Briefing
US ESG Regulatory Briefing | Better late than never: SEC moves in the right direction, but questions remain

It has been long recognized the critical role regulators could play in pushing transparency on how climate risks are affecting companies, and how their actions in turn affect the environment and societies. The release of the SEC proposal is a landmark for climate action, even as its late arrival highlights the complicated nature of de-regulation politics.

In this piece we describe how the Commission is well-positioned to advance climate reporting by providing specific disclosure guidance. We contextualize the proposed rule and analyze the viability and strength of the requirements amid a busy year for ESG activity.

As designed, the disclosures would allow investors to make informed decisions backed by issuer-specific identified risks relating to their operations. On the other side, issuers would benefit by disclosing more efficiently and effectively, in line with investors’ demands.

We note that the proposal did not come out of the blue – the majority of the rulemaking is directly derived from widely accepted frameworks such as the Task Force on Climate-Related Financial Disclosures (“TCFD”), and the Greenhouse Gas Protocol. By integrating widely-used frameworks and maintaining investor protection and legitimacy in mind, the Commission delivers on its commitment to provide guidance for more consistent, comparable, and decision-useful information.

Please find attached a PDF with full details.   

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This communication has been prepared by NatWest Markets Securities Inc., and should be regarded as a Marketing Communication, for which the relevant competent authority is the UK Financial Conduct Authority.

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This communication is prepared by the sales and trading desk or desk strategists and is marketing material, desk strategy and/or trader commentary. It does not constitute research. This material constitutes an invitation to consider entering into a derivatives transaction under U.S. CFTC Regulations 1.71 and 23.605, where applicable, but is not a binding offer to buy/sell any financial instrument. The views of the author may differ from others at NatWest Markets Plc, NatWest Markets N.V. and/or NatWest Markets Securities Inc. (collectively “NatWest Markets”).

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Alvaro Vivanco
Head of EM and ESG Macro Strategy
+1 203 8974896


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