As annual shareholder proposal season and annual report preparation draws near, public companies are facing a series of recent developments in environmental, social, and governance (ESG). These advancements span from climate disclosure landscape and risk factor disclosure, to diversity-related efforts. All are warranting significant attention from corporate entities globally.
The following is a synopsis of some of these developments and additional materials that public companies might find beneficial in the face of these evolving circumstances.
- Climate Disclosure Landscape: Expect changes in the climate disclosure landscape. Regulators are focusing more on climate-related financial risks, and a coordinated global approach towards a more comprehensive climate risk disclosure mechanism is imminent.
- Risk Factor Disclosure: As predominately seen in the guidance issued by the Securities and Exchange Commission (SEC), companies are to adequately disclose risk factors. The more specifically this is done, the better companies are protected from potential legal repercussions.
- Diversity-related Efforts: Shareholders and stakeholders are increasingly demanding transparency in diversity-related efforts within companies. This stems largely from a collective push for equality, inclusion, and diversity in corporate entities from internal personnel to executive boards.
Whether it’s meeting the evolving requirements or striving for transparency across various aspects of operation, it’s clear that public companies have much to consider. For more details and a deeper understanding of these pertinent developments, peruse the original article provided by Latham & Watkins LLP on JD Supra.