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| less than a minute read
Reposted from Linklaters - Americas Insights

SEC will not enforce proxy rules that could limit ESG initiatives

Last week, the Chairman of the U.S. Securities and Exchange Commission, Gary Gensler, announced that the SEC would not enforce rules regarding proxy voting which were put in place under the prior administration in 2020, and which were seen as placing significant restrictions on shareholders' ability to engage companies on ESG issues through the proxy and shareholder proposal process. The Chairman has recommended that these rules be revisited. 

This development accords with the Biden administration's approach of reviewing and potentially reversing policies put in place under the previous administration which potentially affect consideration of ESG issues - such as the Department of Labor's rules on the consideration of "non-pecuniary" (potentially, ESG) factors for ERISA plans (which we have previously written about here). 

In a statement commenting on the SEC announcement, Gary Retelny, President and CEO of corporate governance and ESG solutions provider Institutional Shareholder Services (ISS) said: “We welcome the SEC’s announced decision to consider revisiting its proxy adviser rulemaking, which we believe was ill-conceived, inconsistent with the law, and pushed through under the previous administration against the wishes of investors the agency is meant to protect. We look forward to participating in the upcoming rulemaking process and encourage all good governance supporters to do the same.”

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Tags

esg, sec, securities