ESG

Don’t Compound the Caremark Mistake by Extending It to ESG Oversight

By Stephen M. Bainbridge August 24, 2021 by renholding

Since the foundational decision in In re Caremark Intern. Inc. Derivative Litig.,[1] Delaware corporate law has required boards of directors to establish reasonable legal compliance programs. Although Caremark has been applied almost exclusively with respect to law and …

ISS on Maximizing Good Results in Global Sustainable Finance Industry

By Soumya Munagala August 13, 2021 by renholding

The global sustainable finance industry has been described as an ‘industry in transition’, according to the recently-released Global Sustainable Investment Review 2020. This is reflective not only of the growth of the industry, but also the steps taken by

…

SEC Chair Gensler Speaks on Climate Risk and Disclosure

By Gary Gensler July 29, 2021 by renholding

It’s good to be here with the Principles for Responsible Investment. As is customary, I’d like to note my views are my own, and I’m not speaking on behalf of the Commission or the SEC’s staff.

Before we get to …

Corporate Governance, the Depth of Altruism, and the Polyphony of Voice

By Jeffrey N. Gordon July 27, 2021 by renholding

This post responds to the paper, Exit vs. Voice, by Eleonora Broccardo, Oliver Hart, and Luigi Zingales (BHZ),^[1] a deep engagement with the choice between alternative means by which an “altruistic” investor can influence corporate behavior.  An “altruistic” investor …

SEC Commissioner Peirce Speaks on ESG Disclosure

By Hester M. Peirce July 21, 2021 by renholding

This summer was the summer of the cicadas. The dull hum of their song permeated the solitude of an evening stroll, along with the disconcerting crunch as pedestrian attempts to avoid squashing the creatures inevitably failed. Every seventeen years the …

Wachtell Lipton Discusses the Purpose of the Corporation

By Martin Lipton, William Savitt and Carmen X. W. Lu July 20, 2021 by renholding

In recent years, the concept of “corporate purpose” has been invoked as a shorthand to address a corporation’s commitment to include stakeholder governance—and with it commitments to sustainability, diversity, inclusion, social responsibility and other ESG issues—as part of a corporate …

The Role of the External Auditor in Managing Environmental, Social, and Governance Reputation Risk

By Tamara A. Lambert and Bright Asante-Appiah July 14, 2021 by renholding

Companies are under increasing pressure to manage their reputations on environmental, social, and governance (ESG) issues. Some companies have lost revenue, gone bankrupt, been boycotted by customers, or otherwise suffered a decline in value because of a negative reputation on …

The Evolution of Environmental Discourse in Conference Calls

By Elaine Henry, Xi Jiang, and Andrea Rozario July 12, 2021 by renholding

Climate change disclosure ranks among the priorities of Gary Gensler, the new chair of the Securities and Exchange Commission. With the rapid reallocation of capital to green investments – characterized as a “tectonic shift” by BlackRock[1] and a “frenzy” …

SEC Commissioner Lee Addresses Climate, ESG, and Boards of Directors

By Allison Herren Lee June 29, 2021 by renholding

“You Cannot Direct the Wind, But You Can Adjust Your Sails”[1]

Good morning and thank you for the invitation to speak today at the Society for Corporate Governance 2021 National Conference.  I’m impressed with your full and informative agenda

…

Wachtell Lipton Discusses Key Corporate Governance Issues for Mid-Year 2021

By Martin Lipton, Steven A. Rosenblum and Karessa L. Cain June 28, 2021 by renholding

Last year, we did a mid-year edition of our annual Thoughts for Boards of Directors to highlight key issues and considerations in managing the challenging business environment and profound upheaval caused by the pandemic.  Many of these issues are still …

SEC Commissioner Asks Whether Agency Can Make Sustainable ESG Rules

By Elad L. Roisman June 23, 2021 by renholding

Thank you Gary [LaBranche] and the National Investor Relations Institute for inviting me to speak at your 2021 Virtual Conference. Of course, I will clarify up front that the views I express are my own and do not necessarily reflect

…

Paul Weiss Discusses SEC Move to Consider ESG Disclosures

By Daniel J. Kramer, David S. Huntington, Mark S. Bergman, Brad S. Karp and Audra J. Soloway June 22, 2021 by renholding

The SEC recently closed its period of public comment on the topic of climate-change disclosures after receiving hundreds of submissions. The comments, not surprisingly, reflected a range of views regarding climate-related disclosures, including whether the SEC should or must limit …

The SEC’s Regulation of ESG Disclosures

By David A. Katz and Laura A. McIntosh June 21, 2021 by renholding

The U.S. Securities and Exchange Commission has indicated that ESG disclosure regulation will be a central focus of recently confirmed SEC Chair Gary Gensler’s tenure. At the top of the agenda is climate change disclosure, and the Commission is taking …

ISS Discusses How ESG Investing Stands Up to the Critics

By Duncan Paterson, Anthony Campagna and Meagan Rossi June 21, 2021 by renholding

There is a quote that is commonly misattributed to Mahatma Gandhi: “First they ignore you, then they laugh at you, then they fight you, then you win.”

At the regular get-togethers in the responsible investment industry, war stories are frequently …

ESG and the Pricing of IPOs: Does Sustainability Matter?

By Alessandro Fenili and Carlo Raimondo June 18, 2021 by renholding

In recent years, investors and others in the financial community have devoted increasing attention to the role of sustainability in financial markets and the economy at large. Sustainability is now seen as an alternative form of risk management, a way …

Putting the Electric Cart Before the Horse:* Inevitable Costs of a New ESG Disclosure Regime

By Elad L. Roisman June 7, 2021 by renholding

Thank you to Dan [Bigman] and the Corporate Board Member for inviting me to participate in today’s ESG Board Forum.  Of course, the views I express here are my own and do not necessarily represent those of my fellow Commissioners.

…

Cleary Gottlieb Discusses EC’s Corporate Sustainability Reporting Directive

By Maurits Dolmans, Geraldine Bourguignon, Clara Cibrario Assereto and Toon Dictus June 2, 2021 by renholding

On April 21, 2021, the European Commission published an ambitious new package of “sustainable finance” regulation proposals. By far the most awaited element of this release concerned the Commission’s proposal for the review of the Non-Financial Reporting Directive (“NFRD…

SEC Commissioner Lee Speaks on Myths and Misconceptions about “Materiality”

By Allison Herren Lee May 26, 2021 by renholding

Thank you, Neil [Stewart] for the introduction and for having me today as you discuss the important and timely topic of climate and ESG disclosures. I very much look forward to hearing from Janine [Guillot] and Julie [Bell Lindsay]. You

…

SEC Commissioner Lee Speaks on Leveraging Regulatory Cooperation

By Allison Herren Lee May 24, 2021 by renholding

Good afternoon. It’s a privilege to welcome you all to the annual Section 19(d) Conference. I want to start by commending NASAA and SEC staff for their work in putting this event together. And thanks to our colleagues from NASAA

…

ISS Revisits the Performance of ESG Screened Indexes During the Pandemic

By Hernando Cortina May 18, 2021 by renholding

Nearly a year ago, we analyzed the outperformance of ESG strategies during the initial stage of the COVID-19 Pandemic. As of May 2020, we found that ESG indexes based on ISS ESG data had outperformed by 1.3% to 2.8%, with …