Shareholder advocacy group As You Sow has written a comment letter to the US Securities and Exchange Commission (SEC), warning that proposals to weaken Regulation S-K would “undermine risk evaluation” and “reduce corporate accountability”.
The SEC launched a public consultation over recent months on proposed measures to revise the narrative and qualitative information that public companies need to provide under the regulation.
As You Sow stresses the importance of Regulation S-K disclosures on risk factors, management analysis, executive compensation and governance structures for investors.
It also rebuts the argument that the disclosures overload investors with information, and warns that shifting to a company-determined materiality standard would undermine comparability.
As You Sow CEO Andrew Behar stated: “Regulation S-K is the foundational disclosure framework that governs risk, governance, and financial information. It should be strengthened not diminished.”
“Investors depend on these standardized, legally reliable disclosures to evaluate risk, compare companies, and make informed decisions about how to invest their money,” he added. “Weakening disclosure requirements will undermine the transparency that makes the US the most trusted market in the world.”
