This year is shaping up to be a formative one for ESG, both on the regulatory and financial front.
With all eyes on the Securities and Exchange Commission’s long-awaited climate disclosure rule, now expected in April, many experts and corporations are uncertain if they will be expected to report on scope 3 emissions. Though the rule is not a far cry from global disclosure requirements already in place — such as the European Union’s Corporate Reporting Directive — the SEC received over 16,000 public comments to its proposal, causing the agency to repeatedly postpone its release date.
At the moment, the SEC has provided no further insight into what the final version of this rule will entail, and whether scope 3 disclosure requirements will make the cut. Plus, it’s not the only ESG-relevant rule the agency has on its docket.
On the investments front, ESG proposals are battling a decline in support from company shareholders, despite a record number of proposals being filed in 2023. A pivot from major asset managers such as BlackRock and Vanguard — both of whom have reduced their approval rates for environmental and social-related shareholder proposals and a backdrop slated with a rise in anti-ESG proposals from opponents have contributed to this dip, experts say.
These are just some of the developments already impacting the ESG landscape this year. Read on for a deeper look at what’s in store for 2024.