Sec. 103. ESG disclosures
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Section 14 of the Securities Exchange Act of 1934 ( 15 U.S.C. 78n ) is amended by adding at the end the following: Each issuer the securities of which are registered under section 12 or that is required to file annual reports under section 15(d) shall disclose in any proxy or consent solicitation material for an annual meeting of the shareholders— a clear description of the views of the issuer about the link between ESG metrics and the long-term business strategy of the issuer; and a description of any process the issuer uses to determine the impact of ESG metrics on the long-term business strategy of the issuer.
In this subsection, the term ESG metrics has the meaning given the term in part 210 of title 17, Code of Federal Regulations as amended pursuant to section 3(b) of the ESG Disclosure Simplification Act of 2021. . The Securities and Exchange Commission (in this Act referred to as the Commission ) shall amend part 210 of title 17, Code of Federal Regulations (or any successor thereto) to— require each issuer, in any filing of the issuer described in such part that requires audited financial statements, to disclose environmental, social, and governance metrics (in this title referred to as ESG metrics); and define ESG metrics.
The Sustainable Finance Advisory Committee established pursuant to section 4(k) of the Securities and Exchange Act of 1934 shall, not later than 180 days after the date of the first meeting of such Committee, submit to the Commission recommendations about what ESG metrics the Commission should require issuers to disclose. It is the sense of Congress that ESG metrics, as such term is defined by the Commission pursuant to paragraph (1), are de facto material for the purposes of disclosures under the Securities Exchange Act of 1934 and the Securities Act of 1933.
When amending part 210 of title 17, Code of Federal Regulations (or any successor thereto) pursuant to paragraph (1), the Commission may, as the Commission determines appropriate, incorporate any internationally recognized, independent, multi-stakeholder environmental, social, and governance disclosure standards. Any disclosure required by paragraph
(1)may be included in a notes section of the filing. The Commission may use a phased approach when applying any amendments made pursuant to paragraph
(1)to small issuers and may determine the criteria by which an issuer qualifies as a small issuer for purposes of such phased approach.
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