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U.S. markets regulator names climate risks, fintech as 2021 priorities - Metro US

U.S. markets regulator names climate risks, fintech as 2021 priorities

FILE PHOTO: The U.S. Securities and Exchange Commission logo adorns an office door

WASHINGTON (Reuters) – The U.S. Securities and Exchange Commission (SEC) on Wednesday continued to ramp up its focus on climate-related investment risks, naming it a 2021 examination priority alongside fintech and conflicts of interest for brokers and investment advisors.

The SEC has already made moves under President Joe Biden to heighten scrutiny over how companies handle the issue, from alerting public companies it will be reviewing their disclosures on the subject to warning investors to be cautious of investing in so-called Environmental, Social and Governance (ESG) funds.

On Wednesday, the SEC’s acting chair Allison Herren Lee said the agency’s examination division will focus on ESG risks by examining proxy voting policies and practices to make sure voting aligns with investors’ best interests.

“Through these and other efforts, we are integrating climate and ESG considerations into the agency’s broader regulatory framework,” she said in the statement.

In addition to these moves by the SEC, Biden’s nominee to chair the agency on Tuesday said companies may be required to disclose ESG risks if investors consider them to be material.

Conflicts of interest for brokers and investment advisors and risks related to the fintech industry were two other issues on the examination priority list, which the SEC announces annually.

The SEC will focus on whether investments in digital assets, or cryptocurrencies, are in the best interest of investors, among other fintech issues, the agency said on Wednesday.

(Reporting by Chris Prentice, Editing by William Maclean)

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