In September 2021, the Securities and Exchange Commission (SEC) Division of Corporation Finance (Division) provided public companies with guidance about disclosures of climate-related information that SEC expects from public companies. This guidance appears in a newly-released template with sample comments the Division may issue to companies regarding failures to make adequate climate-related disclosure. The remainder of this note provides some context to the relevant SEC-administered provisions, and summarizes the Division’s new letter.
Audit, Compliance and Risk Blog
SEC emphasizes need for clear disclosure of climate change-related impacts on public companies
Posted by Jon Elliott on Mon, Oct 25, 2021
Tags: SEC, climate change, csr, Environment
Are Your Climate Risks “Material”, and If So, Do You Disclose Them?
Posted by Jon Elliott on Thu, May 17, 2018
Tags: Corporate Governance, Business & Legal, SEC, directors, directors & officers
SEC Expands Public Company Cybersecurity Disclosure Expectations
Posted by Jon Elliott on Tue, Apr 10, 2018
The Securities and Exchange Commission (SEC) has just published Interpretive Guidance to “assist” public companies with evaluation and reporting of their cybersecurity risks. This Guidance expands similar SEC guidance issued in 2011, reflecting the growing importance of the issue and highly-publicized cybersecurity breaches during the intervening years. The following discussion summarizes the new Guidance, and provides context.
Read MoreTags: Corporate Governance, Business & Legal, SEC, Internet, directors, directors & officers
International Business Group Recommends Climate-Related Financial Disclosures
Posted by Jon Elliott on Tue, Aug 15, 2017
As governments worldwide consider expanding requirements to manage greenhouse gas (GHG) emissions and moderate climate change, private sector groups are mobilizing to craft voluntary reporting and management activities – which might shape or even avoid future governmental mandates. In May, the 32 international business leaders on the Financial Stability Board’s (FSB’s) Task Force on Climate-related Financial Disclosure issued recommendations for climate-related financial disclosures by public companies worldwide. The Task Force reported these recommendations to the Group of 20 (G-20) leaders at last month’s meeting in Hamburg – the G-20 finance ministers and central bankers had asked FSB in 2015 to commission the Task Force.
Read MoreTags: SEC, Greenhouse Gas, ghg, climate change
BC Securities Commission Addresses Allegations of Fraud Against Real Estate Developer
Posted by Ron Davis on Thu, May 04, 2017
In Re Hornby Residences Ltd. (2017 BCSECCOM 17), the British Columbia Securities Commission had to determine whether a real estate development corporation and its principal had violated the BC Securities Act s. 57(b) prohibition against fraud in connection with the issuance of a security when the funds invested were used to pay the principal and other corporations controlled by the same principal, Brendan James Schouw. Schouw was a real estate developer and the sole director of Hornby, and of Grace Residences Ltd. and Homer Residences Ltd. Schouw was also connected with Drake Residences Ltd., although the Commission was not provided with information about its directors and officers.
Read MoreTags: Corporate Governance, Business & Legal, SEC, Canadian, directors & officers
As you consider which gifts to give this Holiday season, the U.S. Supreme Court has just made it clear that you should not give the gift of insider stock tips. The Salman v. United States decision resolves a split between lower courts about whether the government must show that someone who breaks trust by giving insider information to a friend or relative automatically breaks rules against insider trading since the “tipper” expects the “tippee” will make money from the tipped information, or whether prosecutors must be prove the tipper expects to gain personally when the tippee trades.
Read MoreTags: SEC
SEC Tries Again To Increase Resource Extraction Issuers’ Reporting
Posted by Jon Elliott on Tue, Jul 26, 2016
The Securities and Exchange Commission (SEC) has recently republished requirements for publicly listed “resource extraction issuers” to report payments they make to the U.S. federal government or foreign governments, related to commercial development of oil, natural gas, or minerals. These requirements fulfill one of many duties assigned SEC by the 2010 Dodd-Frank Act, this one codified in a new Section 13(q) of the Securities and Exchange Act of 1934 (1934 Act).
Read MoreTags: SEC, Environmental, Oil & Gas, directors, directors & officers
Oil Companies Must Let Shareholders Vote To Expand Reporting Relevant To Climate Change
Posted by Jon Elliott on Thu, Apr 14, 2016
In recent years, activist investors have sought to expand climate-related reporting by publicly traded companies – directly by pressuring the companies, and indirectly by petitioning the U.S. Securities and Exchange Commission (SEC) and other regulators to require additional reporting in periodic reports on the businesses’ status and prospects, and in annual meeting reports and proxy requests. SEC has been criticized for doing very little in response to these requests, but took potentially important actions on March 23.
Read MoreTags: SEC, EHS, Oil & Gas, directors, directors & officers
The 2012 Jumpstart Our Business Startups (JOBS) Act enacted a number of changes to national securities laws intended to make it easier for small companies to raise capital privately, before having to confront the possibilities of initial public offerings or acquisition. One important piece directed the Securities and Exchange Commission (SEC) to enact rules to allow “crowdfunding” of qualifying small capital issues without requiring registration of the securities or issuer with SEC itself. The JOBS Act directed SEC to issue its rules by January 2013, but SEC only completed the task in November 2015, with rules that will become effective in May 2016. (I blogged about the proposal here) SEC’s new Regulation Crowdfunding (codified as 17 Code of Federal Regulations (CFR) part 227) defines requirements for issuers, and a new category of registered entities called “intermediaries”, who must register with SEC as brokers (using pre-existing rules) or as a new category of party called “funding portals.”
Read MoreTags: Business & Legal, SEC, EHS
SEC Ponders Responsibilities For Board of Directors’ Audit Committees
Posted by Jon Elliott on Tue, Sep 15, 2015
Boards of directors are responsible for governing their corporations. Many boards divide their work among committees. Committees often include an “audit committee,” with responsibilities that may include:
Tags: Business & Legal, SEC, Accounting & Tax, Audit Standards