Columbia Law School
Sky Blog
Today [March 9], the Commission is considering a proposal to mandate cybersecurity disclosures by public companies. I am pleased to support this proposal because, if adopted, it would strengthen investors’ ability to evaluate public companies’ cybersecurity practices and incident reporting.
disclosure
SEC Commissioner Peirce Dissents on Cybersecurity Proposal
Thank you, Renee, Ian, and Jessica. Cybersecurity risk is top of mind for everyone. The Commission’s consideration of this topic—whether for investment advisers, as we did a month ago,[1] or public companies, as we are doing today [March 9]—is, …
Do Jobseekers Value Diversity Information?
Recent social movements have generated a renewed emphasis on promoting diverse and inclusive workplaces. For example, institutional investors have increased their investments in firms that demonstrate strong commitments to diversity, and regulators also increasingly require firms to describe the extent …
How Firms’ Simultaneous Release of Information Affects Market Feedback
Can managers obtain more useful feedback from capital markets by disclosing pieces of information separately and at different times instead of bundling the information and releasing it at once? It is well known that capital markets’ response to firms’ announcements …
What ESG-Related Disclosures Should the SEC Mandate?
The Financial Economist Roundtable (“FER”) met in July 2021 to discuss current efforts to measure and require disclosure of firms’ ESG activities.[1] The views of individual FER members about specific issues often differ, but the consensus was that financial …
Do Firms Redact Information from Material Contracts to Conceal Bad News?
The Securities and Exchange Commission (SEC) regulates and monitors companies to increase transparency and protect investors. The securities laws consider the companies’ interests and allow them to make requests to redact certain information in SEC filings and not publicly disclose …
Skadden Discusses How New SEC Standards May Prompt Rise in Climate-Related Securities Suits
In 2010, the Securities and Exchange Commission (SEC) provided public companies with interpretive guidance on existing SEC disclosure requirements as they applied to climate change developments. The guidance did not alter disclosure requirements but suggested that, under the existing framework, …
Do Companies Lobby Against Mandatory Disclosure to Protect Proprietary Information?
Critics of mandatory public disclosure often argue that it may put disclosing firms at a competitive disadvantage by requiring them to reveal potentially proprietary information to rivals. For instance, when the Financial Accounting Standards Board (FASB) proposed to mandate more …
Climate-Risk Disclosures and “Dirty Energy” Transfers: “Progress” Through Evasion
At first glance, recent progress towards transparency in corporate climate-risk disclosures seems exceptional. Over 2,000 companies now publish annual reports showing their carbon emissions data (although most self-interestedly omit Scope 3 data). Many (including most recently ExxonMobil) have made a …
Mandatory Corporate Climate Disclosures: Now, but How?
Climate change is one of today’s most salient policy challenges. Under the Paris Agreement, 195 governments agreed to limit temperature increases to well below 2, preferably 1.5, degrees centigrade relative to pre-industrial levels. Since the magnitude of global warming is …
How Does Better Access to Public Firm Disclosures Affect IPO Firm Financing?
Financial markets affect the economy in a fundamental way by facilitating the creation of capital. The market for initial public offerings (IPO) – also known as the “primary market” – is especially important because it allows fast-growing and innovative companies …
Does SEC Scrutiny Improve Mutual Fund Disclosures?
Millions of investors rely on the disclosures of U.S. registered mutual funds in making their investment decisions, but some of the most influential industry opinion leaders and legal scholars have criticized the quality of those disclosures. Like public companies, mutual …
Corporate Disclosure: Facts or Opinions?
When it comes to financial disclosure, headline numbers are not all that matters. Equally important are what company executives talk about – and even how they talk about it. A large and growing body of literature in finance and accounting …
SEC Considers Amendments to Rule 10b5-1
It was a very busy day at the U.S. Securities and Exchange Commission yesterday, with the commission weighing in on several proposed rule changes. For starters, the commission considered proposed amendments to Rule 10b5-1 and new disclosure requirements designed to …
SEC Considers Proposals to Enhance Buybacks Disclosure
On December 15, the U.S. Securities and Exchange Commission considered proposals to enhance disclosure about stock buybacks. Commission Chairman Gary Gensler’s statement supporting the proposals is available here. The statements of commissioners Caroline A. Crenshaw and Allison Herren Lee in …
Compensation Disclosure: A Study Based on Semantic Similarity
How companies determine executive compensation plays a critical role in corporate governance by helping recruit, motivate, and retain key employees. Not surprisingly, it has attracted broad attention from academics, investors, regulators, and the general public. In a recent study, we …
SEC Chair Gensler Speaks on the Risks of SPACs
Thank you for the kind introduction, Ty [Gellasch]. It’s great to be with the Healthy Markets Association.
As is customary, I’d like to note that my views are my own, and I am not speaking on behalf of my fellow
Mandatory vs. Voluntary ESG Disclosure, Efficiency, and Real Effects
In recent years, several countries have imposed disclosure requirements on public firms for environmental, social, and governance (ESG) performance. These mandates have also been accompanied by the European Union’s wide-reaching Non-Financial Reporting Directive, effective in 2018 (Directive 2014/95/EU). Similar legislative …
Does More Effective Director Monitoring Make Management Guidance More Credible?
One of management’s many important roles is to provide information to market participants. However, this information may be self-serving rather than beneficial to the market, especially in the case of voluntary disclosure. To curb this possibility, boards of directors are …
Modernizing ESG and Climate Risk Disclosure
On November 3, timed to coincide with the United Nation’s COP26 climate summit in Glasgow, the IFRS Foundation announced prototype global reporting standards for corporate climate and sustainability disclosures, and the formation of the International Sustainability Standards Board (ISSB) to …