@Risk

Many companies aren’t adequately integrating environmental, social and governance (ESG) issues with new SEC requirements, and that’s causing widespread SEC disclosure noncompliance, according to recent research by CSR Insight LLC.

The study, billed as the first independent, comprehensive technical study of how the SEC regime applies to ESG issues found that:

• More than a dozen SEC requirements potentially apply, for 10-K, 10-Q, 8-K, and other corporate SEC filings, including narrative disclosure and financial statement requirements, books and records requirements, and management certification requirements.
• There’s a substantial likelihood of widespread corporate noncompliance with one or more of these SEC requirements.

CSR Insight, which is an independent consultancy specializing in analysis of SEC and global financial regulation, global financial regulatory policy, ESG reporting frameworks, ESG capital market issues, and international corporate governance standards,  concluded that the problem is this: (more…)

Even though the global financial crisis and ever-expanding supplier networks have intensified the spotlight on risk, companies are still struggling to define “risk management” and overcome barriers to its adoption.

For example, more than half of the risk management, finance and C-level executives participating in a new survey from Marsh Inc. and the Risk & Insurance Management Society Inc. (RIMS) rated enhancing strategic risk management as their primary focus area in 2010. Yet, when asked about the top challenges they face when trying to improve their company’s risk management practices, managers in the survey cited what I would consider fundamental system requirements, such as : (more…)

Yesterday, the U.S. Securities and Exchange Commission issued ground-breaking guidance that clarifies what publicly-traded companies need to disclose to investors in terms of climate-related material effects on business operations. These ‘effects’ include new emissions management policies, the physical impacts of changing weather, and/or business opportunities associated with the growing clean energy economy.

This new guidance, the first economy-wide climate risk disclosure requirement in the world, comes after more than a dozen investors managing over $1 trillion in assets –plus Ceres and the Environmental Defense Fund –requested formal guidance in a petition originally filed with the Commission in 2007, and then supported by supplemental petitions filed in 2008 and 2009.

“Today’s vote is a clarion call about the vast risks and opportunities climate change poses for US companies and the urgency for integrating them into investment decision making,” says Mindy Lubber, president of Ceres and director of the Investor Network on Climate Risk, a network of 80 institutional investors with $8 trillion in collective assets. “The business risks of climate change cannot be ignored. With this guidance investors can make more sound decisions based on better information – and businesses will have a level-playing field with clear standards and expectations for disclosure.”

The SEC decision is the latest in a series of major policy actions over the past year requiring more robust climate risk disclosure across various industry sectors. Those actions include: (more…)

The U.S. Securities and Exchange Commission has adopted amendments to its rules that will require enhanced risk management disclosure at all U.S. public companies.

These requirements become effective February 28, 2010 and will require registrants to make new or revised disclosures about: (more…)