[ad_1]
Microsoft and Alphabet refused to disclose environmental, social and governance issues in major US regulatory documents, which caused them to dispute with major asset management companies.
Technology companies tell the top US securities regulators that ESG information should not be included in a file called 10k, which most public bodies must submit annually. Microsoft and Alphabet said that the inclusion of ESG information in these documents will expose them to potential legal risks, because such data is more uncertain than the current detailed financial and risk disclosure requirements of 10ks.
The documents submitted by the two to the US Securities and Exchange Commission in recent days conflict with Pimco, Invesco, and other large asset management companies that want to include ESG information in 10ks. The SEC is planning to make the disclosure of information mandatory and is considering where it should be disclosed.
Josh Zinner, CEO of the Interfaith Center for Corporate Responsibility, which includes religious organizations and other ESG-conscious investors, said that such disclosures will create a “fairer playing field and highlight the leadership of these companies. status”.
The 10,000 documents submitted each year must be signed by the company’s CEO and financial officer and reviewed by SEC staff, making it one of the most important types of disclosure for listed companies.
Zinner stated that Microsoft and Alphabet “position themselves as leaders in sustainable development, and they should certainly support mandatory disclosure of ESG matters, including in their regulatory documents, and they will be responsible for the content of this information.”
The struggle between asset management companies and companies over ESG disclosure is expected to intensify in the coming months. As global warming and human rights bring new risks to companies, the US Securities and Exchange Commission has set out to formulate unprecedented information disclosure rules for the booming ESG industry.
Bank of America stated in a June 1 report that by 2021, nearly one-third of global stock inflows will flow into ESG funds. The bank said that the assets under management of ESG funds reached a record US$1.4 trillion in April, more than twice the amount a year ago, and the growth rate was nearly three times that of non-ESG assets.
Both Microsoft and Alphabet have benefited from this surge. Bank of America said that Microsoft is the company with the most extensive holdings in US ESG funds. Alphabet is one of the 10 most popular ESG companies, and almost half of US ESG funds hold it.
Alphabet joins other technology companies A letter from the U.S. Securities and Exchange Commission Last week it was recommended that ESG disclose “provided to the SEC through a separate climate report”.
The two companies stated: “Given that climate disclosure relies on estimates and assumptions that involve inherent uncertainties, it is important not to expose companies to improper liability, including those from private parties.”
Patrick Flynn, vice president of Sustainability at Salesforce, said that if the company is worried about being sued, this may undermine the SEC’s overall goal of providing more ESG data to the market. “For companies, this is a new process and they need to establish new procedures. Allow some kind of safe harbor from liability…[allows]The company is willing to push, not just do the minimum. “
Microsoft said Its SEC letter It is not intended to imply that climate information disclosure is not included in the SEC filings at all. It stated that its cycle of compiling and verifying climate data may not be consistent with year-end financial statements.
Although it will continue to provide ESG disclosures outside of SEC filings, Microsoft stated that “we believe that climate disclosures in SEC filings should be limited to information that is significant to the company’s investment or voting decisions.”
Alphabet declined to comment.
“Although it is great to see corporate ESG leaders advocating the SEC to adopt climate information disclosure standards, we do not agree with them that these disclosures should not fall under the current SEC document standards,” said Molly Betournay, Director of Shareholder Advocacy at Clean Yield Asset Management . “The standard climate report should be included in the SEC’s regular documents.”
[ad_2]
Source link
