Breaking Down the New SEC Ruling
The Securities and Exchange Commission recently proposed a new ruling that would require public companies to include information regarding climate controls and risks in their registration statements and regular filings. The proposal has many implications and aims to make companies more transparent to their stakeholders.
In a press release announcing the proposed ruling, SEC Chair Gary Gensler said, “Investors need reliable information about climate risks to make informed investment decisions…I believe the SEC has a role to play when there’s this level of demand for consistent and comparable information that may affect financial performance.”
We’ve covered trends in ESG press releases over the first months of the year, and this new rule could mean even more ESG-related content crossing the wire.
The Changes Can Already Be Seen in Some Press Releases
While the proposal only requires public companies to disclose climate-related risks and potential greenhouse gas emissions within 10-K filings, some companies have already taken it a step further. For example, Marathon Oil added an “ESG Excellence” section to its fourth quarter earnings release. Similarly, Delta Air Lines and Southwest Airlines added sections about Environmental, Social and Governance to their fourth quarter releases.
The messaging within each of these releases stated a clear plan of action as well as recent accomplishments in ESG. This increased visibility into ESG developments helps establish credibility while building better connections to stakeholders.
What this Means for PR and IR Professionals
If you’ve already started building ESG into your communications strategy, this new SEC ruling (should it affect your organization or any organizations you represent) should feel like a natural next step in your plan.
If ESG isn’t yet on your radar, here’s why it should be: Decisionmakers (from the customer level all the way to the shareholders) are looking for more data and information around carbon emission reduction, diversity in the workplace, community improvement and outreach, and corporate governance and structure.
Investors look at companies with good ESG practices as more profitable and better long-term investments, and sustainability practices have been linked to better financial performance. If your organization has ESG initiatives in place – and this can include everything from more sustainable business practices, to DEI initiatives to responsible investing – communicating those initiatives isn’t just good for your brand, it’s good for the bottom line.
Press releases are one of the easiest, fastest and most effective ways to get your ESG messaging across to the audiences who care most, and it’s important to stay ahead of the rules around it. If you distribute yours via a services like PR Newswire, which has a specialized ESG arm, you can be confident your press release content falls within the SEC guidelines.