Newsletter

After two years of serious consideration, including review of a record number of public comments the agency received on the draft rule, the Securities & Exchange Commission issued its final corporate climate disclosure rules on March 6. Anti-ESG critics quickly moved into action, with various state attorneys general, the U.S. Chamber of Commerce, state treasurers and finance heads, and others, attacking the rule with court challenges and other measures.  

Several lawsuits were filed to prevent the SEC from implementing the rules, which  have been consolidated in the U.S Court of Appeals for the Eighth Circuit (covering the states of Arkansas, Iowa, the Dakotas, Minnesota, Missouri, and Nebraska). The final decision may well end up being decided by the U.S. Supreme Court. While the legal actions are playing out, the SEC has stayed its rules.  

With the SEC disclosure rules on hold, the anti-ESG forces are making climate and ESG into prominent issues in Congress and in 2024 political campaigns. Several committees in the U.S. House of Representatives have passed measures to try to prevent financial institutions from using ESG factors in investment decision-making. Depending on election outcomes this year, there could be more actions to rein in ESG policies in the next Congress. 

In monitoring what U.S. companies are doing as the SEC disclosure rules are on hold, this headline grabbed our attention and is one of our Top Stories: “Alive and Kicking: The Future of ESG.” The commentary is from CCI, an independent, free, web-based news source focused on compliance, ethics, and risk management. Jennifer Gaskin, CCI’s editorial director, begins with the observation that “…few companies are spending time relaxing and even fewer are abandoning their ESG commitments” while waiting for the outcome of the court cases challenging the SEC’s new climate disclosure rules. She posits: They cannot afford to.

A major factor cited is the proliferation of international ESG / sustainability reporting frameworks, especially including moves in the European Union (CSRD, ESRS) and the Corporate Sustainability Standard Board’s voluntary framework. California’s climate reporting rule will affect many public and private companies. 

In a Harvard Law School Forum on Corporate Governance commentary by the law firm Latham & Watkins, also a Top Story in this issue, market actors are looking for ways to more fully integrate climate risks into business decisions. Internally, many corporate executives are examining climate-related costs and impacts, and the complexity of cross-jurisdictional climate-related reporting.

These topics are currently being explored in depth in G&A Institute’s Pathfinder webinar series. G&A Institute team members are also working with corporate clients moving forward in their sustainability journeys and preparing more complete disclosures on their progress to better inform their stakeholders. These Top Stories explain “why” enlightened corporate managers are pressing on despite the attitudes of the anti-ESG voices. For sure there is more news to come on pro-and anti-ESG actions.

Top Stories

• Alive & Kicking: The Future of ESG (Corporate Compliance Insights)

• The Case Against the SEC’s Final Climate Rules Begins in Earnest, and What it Means (Harvard Law School Forum on Corporate Governance)

Sustainability Standard Setters & Policy Makers

SEC, SASB, GRI, IIRC, FSB-TCFD

• GRI Launches ‘CSRD Essentials’ Series to Simplify EU’s Corporate Sustainability Reporting Directive (ESG News)

• Exclusive: Corporate climate watchdog document deems carbon offsets largely ineffective (Reuters)

• Hong Kong Launches Taxonomy to Classify Green Activities and Investments (ESG News)

ESG / Sustainable & Responsible Investment

Asset Owners & Managers, Ratings Agencies

• Banks Back Fossil Fuels With $6.9 Trillion (Forbes)

• Fidelity International Launches New Article 9 SDG-Focused Sustainable Bond Funds (ESG Today)

• US banks face climate risk data challenges, Fed analysis shows (Reuters)

Corporate Sustainability / ESG

Disclosure, Reporting, Corporate Initiatives

• LEGO Group Ties Bonuses for All Employees to Emissions Reduction Goals (ESG Today)

• Climeworks Begins Operations at World’s Largest Direct Air Capture Plant in Iceland (ESG News)

Stakeholders That Matter

Developments, Trends, Corporate Actions Affecting Stakeholders

• Solar Makers Care About Profits Over US Need, Renewable CEO Says (Bloomberg – subscription required)

• How Climate Disasters Could Destabilize Major Banks (Scientific American)

• Scientists Warn against Treating Forests as Carbon Commodities (Scientific American)

Global Sustainability News: Forward Momentum!

News & Developments of Note

• Last Summer Was the Hottest in 2,000 Years — and 2024 Could Top It (Bloomberg – subscription may be required)

• El Nino, water management issues blamed for snarling Panama Canal (Reuters)

• Australian Startup Mimics Trees to Make Cheaper Green Hydrogen (Bloomberg – subscription may be required)

Sustainability Data in Focus

Developments in Data, Research, Trends

• More than a Third of S&P 500 Companies Now Have Compensation Tied to Climate Goals: S&P Global (ESG Today)

• Banned Chinese cotton found in 19% of US and global retailers' merchandise, study shows (Reuters)

• 72% Of European Companies Include Disability In Their ESG/ Sustainability Reports (Forbes)

U.S. Climate Actions

Updates from and about Washington D.C.

• Biden administration to increase tariffs on Chinese electric cars to 100 percent (The Hill)

• EPA Boosts Emissions Reporting Requirements for Oil & Gas Companies (ESG Today)

• Renewables make up the lion’s share of new electric generation, federal agency finds (The Hill)

Eyes on Europe

ESG Regulations

• Can the UK deliver food security in an age of climate crisis? (Business Green – subscription may be required)

• EU Set to Water Down Climate Rules to Placate Angry Farmers (Bloomberg – subscription may be required)

• Global renewables approach 30% share in 2023, on the back of solar, EU leadership (Euractiv)

• EU’s Green Deal target of disinfo ahead of June vote (Euractiv)

These feeds are provided for G&A Institute in partnership with 3BL. 3BL distributes press releases, blogs, videos, podcasts, reports, newsletters and more to the growing audience of stakeholders interested in Corporate Social Responsibility (CSR) and Sustainability. Visit 3BL.com for more.

• How Dow is Helping To Advance Sustainability and Address Gender Inequities in Kenya (Article from: DOW)

• Empowering Communities: Teresa Pelletier on Financial Education and Volunteerism at Fidelity Investments (Article from: Common Impact)

• Supporting Parents Online With Our Screen Smart Program (Article from: Meta)