Making its debut at the Society's National Conference in Chicago last week, White & Case's "ESG Disclosure Trends in SEC Filings" reveals the seven ESG categories that experienced the most significant increases in disclosure from 2021 to 2022 based on the firm's review of Form 10-Ks and proxy statements filed by 50 Fortune 100 companies:
More specifically:
- Environmental-related disclosure (predominantly climate) represented the largest increase year-over-year, with all 50 companies including environmental disclosure in their Form 10-K (48 of 50 companies, up from 37 companies in 2021) or proxy statement (48 companies, on par with 2021).
- Human capital management (predominantly DE&I) represented the second largest increased disclosure category, appearing in all companies’ Form 10-Ks and nearly all (96%) proxy statements, with more than half of companies including quantitative metrics.
- E&S goals and targets represented the third largest increased disclosure category, with 49 of 50 companies including some form of E&S goal or target in their proxy (96%) and/or Form 10-K (64%). Of the 44 companies that included quantitative goals, 40 related to GHG emissions.
The report summarizes the most prevalent disclosure topics and provides examples within each of the seven categories.
Among other key takeaways, on the heels of the SEC staff’s recent and ongoing climate comment letter sweep, which nearly universally asked targeted companies to explain the basis for different disclosures in their Form 10-K as compared to non-SEC filings (e.g., sustainability report, website), the firm advises companies to assess all ESG information for materiality and be very deliberate about what information is included where and why. The firm also emphasizes the importance of applying robust controls to ESG information on par with financial information.
Access numerous additional resources on our Sustainability/ESG page.