SEC Commissioner Kara Stein gave an address to the Council of Institutional Investors named “Improving Information for Investors in the Digital Age”. Here are some notable quotes from the Commissioner:
…Just a few weeks ago, a group of institutional investors, asset managers, state treasurers, and others petitioned the SEC. They asked the Commission to require disclosure of environmental, social, and governance (ESG) information by publicly traded companies in a standardized format…
…during the past decade, managers of U.S. companies are communicating more information about how they run their companies, perhaps in an effort to meet both the market’s and investors’ demand for more information. Alternative measures—such as non-GAAP metrics and KPIs—that were once used sparingly, now appear in a host of documents and situations, including road shows, analyst meetings, and quarterly earnings calls. However, the lack of uniformity in definition, or computation methods, limits comparability. In addition, some fear these measures tend to be “detached from reality.”
…The Commission should lead by helping to create standards for disclosure, using structured data and taxonomies, where applicable. Facilitating the establishment of standards resolves uncertainty and reduces the cost of information.
Read the full speech.