The SEC released an updated regulatory agenda, detailing plans to finalize nearly 30 rules and propose 14 new ones.
"We're updating our rules to promote the efficiency, integrity, and resiliency of the markets," SEC Chair Gary Gensler said in a Dec. 6 statement. "We do so with an eye toward investors and issuers alike, to ensure the markets work for them and not the other way around."
The updated agenda lists 29 proposals in the final rule-making stage and 14 in the proposed rule-making stage. In June, the SEC released a regulatory agenda with 37 proposals in the final rule-making stage, and 18 in the proposed rule-making stage.
Included in the updated agenda's list of proposals yet to be issued is one on corporate board diversity and another on human capital management disclosure, which were also included in the June agenda. In September, the SEC's Investor Advisory Committee recommended that the agency promulgate rules to increase disclosures on human capital management.
The committee recommended requiring disclosure of the number of people employed by an issuer, broken down by full-time, part-time, contract and contingent employees; turnover metrics; total cost of the issuer's workforce, broken down by major components of compensation; and demographic data to help investors understand how the firm is working to develop new sources of talent and the effectiveness of such efforts.
Of the 29 proposals in the final rule-making stage, some of the more controversial ones listed include those on climate change disclosure, swing pricing and predictive data analytics. The updated agenda slates the finalization for all three rules in April 2024, as it does with several other rule-makings.
The climate change disclosure rule proposal, which the SEC originally introduced in March 2022, would require public companies to disclose an array of climate-related information, including greenhouse gas emissions, in their registration statements and periodic reports. While some say this disclosure would help bring more transparency to investors, others have said it would create unnecessary burdens.
At the Healthy Markets Association annual conference in Washington last week, Gensler told reporters that while most comment letters on the proposal have been positive, "there's also a lot of comments that came in about the costs and also the possible indirect effects on nonpublic companies."
"So we're sorting through that and looking at that very closely, but I can't prejudge" how things will turn out, Gensler said.
Initially proposed in November 2021, the swing pricing proposal would require any open-end fund — other than a money market fund or exchange-traded fund — to use swing pricing, which adjusts a fund's value based on trading activity, so that redeeming shareholders bear the costs of transactions.
In a host of comment letters earlier this year, industry leaders and some House lawmakers said the proposal would hurt retirement savers. And at its September meeting, the SEC's Investor Advisory Committee also recommended that the agency revisit its economic analysis for the proposal, and fully weigh the costs and benefits before making final decisions.
Separately, many trade associations have called for the withdrawal of the SEC's predictive data analytics rule proposal, commonly known as the AI proposal, which the agency issued in July.
That proposal would require investment advisers and broker dealers to "eliminate or neutralize" conflicts of interest that arise from using certain technologies in investor interactions. Critics of the proposal have said it is overly broad and could stifle technology use in financial services.
