Today, the U.S. Impact Investing Alliance expressed support for the latest iteration of the U.S. Securities and Exchange Commission’s (SEC) disclosure agenda to improve transparency for investors.
The SEC’s pair of proposed rules - the Investment Company Names proposal and the Environmental, Social, and Governance (ESG) Disclosures for Investment Advisers and Investment Companies - are intended to improve the reliability and comparability for ESG investment products and strategies for investors.
In addition to expressing broad support for the SEC’s objectives to combat greenwashing and equip investors with decision-useful information, the Alliance’s comments focused on ways the Commission could expand the scope and refine certain provisions in the final rule. The Alliance writes:
“[A]ll covered investment advisers and asset managers should be required to disclose whether and how they approach ESG…Investors are increasingly calling for better transparency regarding how ESG factors into how their funds are invested, driven by the growing body of evidence that many ESG factors are financially material.”
Overall, the proposed rules are a significant step in the right direction, and the Alliance looks forward to engaging with the SEC to ensure the final rule introduces more clarity and rigor into the ESG investing ecosystem.