Investors and U.S. financial regulators have made clear that they seek to hold companies and asset managers responsible for public statements they make about ESG. When the Securities and Exchange Commission (SEC) created the Climate and ESG Task Force within the Division of Enforcement with the express purpose of identifying ESG-related misconduct, many public companies and investment advisers started preparing for expected enforcement actions.

The Task Force is using a variety of methods and potential sources to proactively identify “material gaps or misstatements in issuers’ disclosure of climate risks under existing rules, and disclosure and compliance issues relating to investment advisers’ and funds’ ESG strategies.” It also works closely with other SEC Divisions and Offices, including the Divisions of Corporation Finance, Investment Management, and Examinations.

ESG enforcement is on the rise: Are you ready? | Reuters