SEC Commissioner Peirce Critiques ESG Reporting Frameworks

SEC Commissioner Peirce recently delivered a speech where she extensively criticized the recent emphasis on ESG among businesses, in particular the proliferation of mandatory ESG reporting frameworks. According to Commissioner Peirce, not only is "ESG [] a hopeless muddle," but "asset managers hide behind ESG ambiguity to evade their obligation to investors," "companies sometimes hide behind ESG ambiguity to evade their obligations to shareholders," and "governments sometimes hide behind ESG ambiguity to evade their obligations to citizens." In particular, Commissioner Peirce attacks "[t]he global embrace of corporate ESG reporting and target-setting," which, in her view, "comes at a price: reduced economic growth." In a common refrain among those objecting to regulations, Pierce opines that "[w]hen regulatory codes, instead of popular demand, drive corporate behavior, we lose the dynamism of the unplanned economy."