Boosting market resiliency 'part of our job,' SEC's Gensler says

SEC Chairman Gary Gensler on Wednesday defended the pace of his agency's rule-making agenda, citing the regulator's mission to shore up capital markets, particularly in challenging economic times.

"I think it's part of our job to make sure that the markets are more resilient," Mr. Gensler said during an Investment Adviser Association event. "Look, we're living through uncertain times right now, we've seen this in the last few days in the international bond markets for sure, and the currency markets, but to build greater resiliency into the system" is important.

Mr. Gensler referenced the SEC's proposal to shorten the settlement cycle to T+1 — settling a trade one business day after it is executed — from T+2, or two business days, as a way to add resiliency to the market.

Karen L. Barr, president and CEO of the IAA, an organization for fiduciary investment advisers, moderated the discussion Wednesday and expressed apprehension with the number of rule initiatives the SEC is tackling under Mr. Gensler.

She noted that there are more than 50 rule proposals on the SEC's agenda to which Mr. Gensler said that his predecessor at the SEC, Jay Clayton, finalized 64 rules over a four-year period.

"You're just off the starting block faster," Ms. Barr responded, followed by Mr. Gensler explaining that the issues before the SEC are important and much work is needed to fortify markets.

To that end, Mr. Gensler spoke about two cybersecurity proposals the SEC has put forth — one that would require investment advisers and funds adopt and implement written cybersecurity policies and procedures designed to address cybersecurity risks that could harm clients and investors, and another to require public companies report material cybersecurity incidents on Form 8-K filings within four business days.

"I think cybersecurity is a key risk and it's one of the risks that I'm really proud we're updating," he said. The SEC needs to "make sure our markets are updated for the technologies we have and the realities of the times we live in in the 2020s."

On the SEC's much discussed climate disclosure proposal, which would require public companies to disclose a host of climate-related information in their registration statements and periodic reports, Mr. Gensler said the agency is reviewing the public feedback it received during a comment period that ended in June.

"We need to sort through these 14,000 comments and really make adjustments where appropriate in terms of costs and what we heard from the investor side and what we heard from the issuer side, and also within the laws," Mr. Gensler said.