The U.S. Securities and Exchange Commission (SEC) has confirmed that its climate and environmental, social, and governance (ESG) enforcement taskforce has been disbanded.
Formed in March 2021, the ESG enforcement task force was formed to proactively identify material gaps or misstatements in issuers’ disclosure of climate risks under existing SEC rules and to analyze disclosure and compliance issues relating to investment advisers’ and funds’ ESG strategies.
Touting success for now, the SEC says that they will continue to monitor this space and if they see an uptick in misleading and false ESG claims (as they claim to now be seeing around AI) they will hold violators accountable.
Skeptics may view this as yet another hit to the agency's ESG efforts. The SEC continues to defend its climate-risk disclosure rules in court, but it has removed ESG as a 2024 priority for its Division of Examinations, and proposed and final regulations on greenwashing and human capital disclosures seem unlikely in 2024 given the upcoming presidential election.
“The Commission brought a number of important enforcement actions in the area which have sent a strong message to market participants about the importance of complying with the law when it comes to ESG considerations,” the spokesperson said.
www.esgdive.com/...
