Funds management group urges Biden to set uniform ESG disclosure standard

An influential funds management industry group, representing $34 trillion, is urging President-Elect Biden to jump on ESG disclosure issues within the first 100 days of his administration. Investment Company Institute (ICI) President and CEO Eric Pan explained in a recent letter that, given the growing demand for ESG investments, there is an urgent need for the U.S. to harmonize fragmented, inconsistent corporate disclosures by coming up with uniform standards.

Mr. Pan noted that the U.S. "has largely watched from the sidelines while policymakers in Europe, Asia, and elsewhere introduce legislation and propose international standards to direct financial markets to support ESG objectives." And while the ICI said it supports the approaches by the Task Force on Climate-Related Financial Disclosure and the Sustainability Accounting Standards Board, there remains "a risk of clashing and unworkable disclosure regimes that spread confusion at a time when we need clarity and consensus."

Only time will tell whether the calls for action by the ICI, other market participants and regulatory bodies will be heard and cause the Biden administration to take the leadership role that is available, and to address the lack of uniform ESG disclosures.