More companies are designating specific committees for environmental issues to help inform the board of potential problems.
Environmental disclosure is a top priority on many boardroom agendas. The Obama administration and the Securities and Exchange Commission, under the leadership of Chairman Mary Schapiro, are ardent in their pursuit to reform corporate environmental disclosure practices.
Recently, the SEC formed the Investor Advisory Committee (IAC) to address how environmental, climate change, and sustainability issues should be addressed from a regulatory standpoint. Headed by SEC Commissioner Luis A. Aguilar, the IAC provides the SEC with investors’ viewpoints on regulatory and disclosure issues. Current SEC regulations require companies to disclose any information pertaining to how their operations might cause harm to the environment. In order to accurately estimate the amount of environmental damage a company’s operations might have on the environment, firms must invest both manpower and financial capital to fund extensive research projects. For most companies, providing such figures is difficult and often significantly underestimates the true toll a corporation’s operations will have on the environment.
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