Widespread corporate noncompliance with SEC requirements triggered by material ESG issues may cause many SEC filings to be materially misleading, inaccurate, or even fraudulent, finds the first independent, comprehensive technical study of how the SEC regime applies to ESG issues, conducted by CSR Insight™ LLC.  Corporate noncompliance also triggers SEC liabilities and disclosure requirements for corporate boards, auditors, and registered investment advisers and funds.

More than a dozen SEC requirements potentially apply, for 10-K, 10-Q, 8-K, and other corporate SEC filings, including narrative disclosure and financial statement requirements, books and records requirements, and management certification requirements.  Corporate noncompliance also triggers auditor liabilities and potential violations under the current SEC regime. 

The study found a substantial likelihood of widespread corporate noncompliance with one or more of these SEC requirements, due in major part to the inadequacies of most current enterprise software systems, both internally developed and vendor-purchased.  What is lacking is the integration of the full range of ESG issues and risks and the associated additional SEC requirements into ERM, GRC, risk management, performance management, and financial information systems, and necessary linkages amongst these enterprise systems.  This systems integration capacity is necessary for companies to properly identify, evaluate, measure, manage, and monitor these complex, escalating issues and risks, including their nature, magnitude, probability, timing, and business and operating model impacts.

This noncompliance not only undermines investor protection and efficient capital formation, but can have potentially significant ripple or knock-on effects for other market participants and global capital market activity.

For example, corporate noncompliance creates additional SEC disclosure requirements, liabilities, and risks for corporate boards, and for registered investment advisers and funds, including registered private equity and hedge funds.  Corporate noncompliance also can undermine corporate transactions, such as M&A, IPOs, and secondary capital raises.

This is the first in a series of news releases by CSR Insight™ LLC.  Future releases will provide further highlights of CSRI’s analyses of SEC and global financial regulation applicable to ESG issues.

About CSR Insight™ LLC

CSR Insight™ LLC, founded in 2007, is an independent consultancy specializing in analysis of SEC and global financial regulation, global financial regulatory policy, ESG reporting frameworks, ESG capital market issues, and international corporate governance standards.  CSRI has completed a unique, independent five-year Global ESG Regulatory Research Program, and has developed the first educational “Library of Congress” Knowledge Base of global ESG regulatory and market intelligence, available in 2012, designed to educate market participants, stakeholders, academia, policymakers, and regulators on a comprehensive range of key ESG regulatory, economic, industry, and capital market issues.

CSR Insight™ is a syndicated partner of CSRwire and has been a contributing member since 2008. For further information, contact CSR Insight™ at inquiry@csrinsight.com or visit www.csrinsight.com

Disclaimer

All content contained in this news release is provided for informational purposes only and does not constitute advertising, a solicitation, or legal or other professional advice, and is provided with the understanding that CSR Insight™ LLC, and its authors and publishers, are not engaged in rendering legal or other professional advice, and assume no liability whatsoever in connection with any use of the content in this news release.  This news release reflects the current opinions of CSR Insight™ LLC and may change without notice.

CSR Insightâ„¢ LLC

CSR Insightâ„¢ LLC

CSR Insightâ„¢ LLC, founded in 2007 by Linda M. Lowson, Esq., is an independent, nonpartisan consultancy uniquely specializing in Global ESG Regulatory Education, global financial regulatory policy, ESG metrics and voluntary reporting frameworks, and ESG capital market issues. In 2012, CSR Insightâ„¢ launched the exciting Global ESG Regulatory Academyâ„¢ as its flagship business unit, the first-ever provider of independent professional education on Global ESG Regulation and Reporting. The Global ESG Regulatory Academyâ„¢ also provides customized, on-site educational seminars and workshops for companies, boards, asset owners and managers, analysts, professional advisors, and NGOs.

CSR Insightâ„¢ completed a comprehensive 5-year, US$5.5 million Global ESG Regulatory and Capital Market Research Program to develop the Knowledge Base content foundation for this unique, important, and sophisticated professional education. This Research Program included comprehensive, drill-down legal, regulatory, accounting, and technical analyses of global ESG regulatory and voluntary reporting regimes, including the first comprehensive technical analysis of the entire SEC regime as it applies to ESG issues.

Management:

• Linda Lowson, J.D., LL.M., CEO, is an internationally recognized expert in global ESG regulation, global financial regulation, and ESG capital market issues. Previously, Ms. Lowson served as a Shearman and Sterling Attorney and Arthur Andersen Partner, and launched and led Andersen's U.S. Financial Services Strategy Practice and served as a member of its North American Financial Services Executive Leadership Team and Global Financial Services Thought Leadership Team. She holds a J.D. degree from Cornell Law School and an LL.M. degree from New York University Law School.

• Alison Dempsey, J.D., LL.M., Ph.D., Director of Research, is an accomplished and experienced international attorney and international corporate governance expert, and recently published the ground-breaking book, “Evolutions in Corporate Governance--Towards an Ethical Framework for Business Conduct” (November 2013), published by Greenleaf Publishing (Hardback ISBN: 978-1-906093-86-0, PDF Ebook ISBN: 978-1-78353-057-1).

For further information on the Global ESG Regulatory Academyâ„¢ and our educational courses, on-site workshops, and live online webinars, contact Linda Lowson at inquiry@globalregulatoryacademy.com, or visit http://www.cvent.com/d/64qx7p.

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