Investors increasingly are directing capital to sustainable investment strategies that reflect environmental, social and governance (ESG) factors. This substantial growth in ESG investing is occurring against the backdrop of an evolving regulatory environment, with different US regulators, such as the Securities and Exchange Commission (SEC) and the Department of Labor (DOL) taking divergent approaches. Given that climate change and racial equality have been identified as key priorities for the Biden administration, we expect a significant shift in the US regulatory approach to ESG, although it may take some time for that regulatory framework to emerge. Meanwhile, the SEC Examination and Enforcement Staff will likely focus their efforts on identifying what they view to be inaccurate or incomplete disclosure on ESG-related issues, and on misconduct involving the management and sale of ESG investment products by asset managers and financial intermediaries.

Join Baker McKenzie regulatory and enforcement practitioners as we navigate this uncertain time and work together through the challenges ahead. We offer practical advice and real-time analysis of the changing landscape across the United States, Europe and Asia. Webinar Series: The New Framework for Investment Adviser Marketing In this 4-part…

In a significant regulatory action, the US Securities and Exchange Commission (SEC) recently proposed to issue an order granting certain “finders” a conditional exemption from broker-dealer registration in connection with capital raising activities in private markets (“Finders Proposal”). The Finders Proposal seeks to address the long-standing regulatory uncertainty surrounding the status of intermediaries in the private capital-raising markets and to encourage investment in small businesses, which disproportionally rely on finders to locate capital. The proposed exemption would allow natural persons to engage in certain limited activities involving accredited investors without registering with the SEC as brokers under the Securities Exchange Act of 1934 (“Exchange Act”).

Financial regulatory and enforcement momentum focusing on environmental, social and governance (“ESG”) issues is building up from recent activities by US, EU and UK financial regulators.  As a result, we anticipate that asset managers and financial intermediaries will increasingly seek to obtain and analyze ESG-related data and information from companies…