SEC Commissioner Peirce Cautions Against Prescriptive Approach To ESG

SEC Commissioner Hester Peirce cautioned against a formulaic approach to environmental, social and governance ("ESG") disclosures and asset management strategies. In remarks at a "Virtual Roundtable on the Role of Asset Management in ESG Investing" hosted by Harvard Law School, Ms. Peirce said that asset managers should be able to describe their own approaches to the consideration of ESG, enabling them to attract "like-minded" investors.

Ms. Peirce explained that while she understands issuers and investors' requests for the SEC to establish a "standardized ESG disclosure framework," the SEC should adhere to its "tried and true principles-based disclosure framework." Ms. Peirce raised concerns that a prescriptive approach to ESG disclosures would, among other things: