AUM in Action

SEC Urged to Deliver Human Capital Disclosure Rule  

NGO Ceres has written to the Securities and Exchange Commission (SEC) calling for it to issue, as soon as possible, a proposed rule on human capital disclosure. In the letter, Steven Rothstein, Managing Director, Ceres Accelerator for Sustainable Capital, said that the SEC has included human capital disclosure on its regulatory agenda since 2021. But despite issuing rules on climate and cybersecurity risk more than 15 months ago, human capital has not been addressed. Rothstein said that Ceres’ investor network of institutional investors managing over US$50 trillion collectively, had emphasised their strong interest in rulemaking in the area of human capital. The SEC did adopt a human capital management disclosure rule in 2020.But, Rothstein said that rule was principles-based and lacked specific disclosure requirements. “Ceres is concerned about inadequate workforce diversity and corporate board diversity disclosure,” he said. “These types of disclosures appear to be important to the Commission as well – they are expressly mentioned in the SEC’s 2021 regulatory agenda quoted above. Investors with whom we work have told us that they believe diversity is important to them in making their investment decisions.” 

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