On a conference dated 22 June 2021 SEC Commissioner Elad L. Roisman outlined in a publicly available speech that the U.S. Securities and Exhange Commission (SEC) has increased its attention on Environmental, Social and Governance (hereinafter “ESG”) matters and that the Chair would have expressed his intent to propose new disclosure requirements relating to climate change and human capital. Commissioner Roisman expressed his belief that the SEC will need to find answers to several questions before it would be able to promulgate such rules that would stand the test of time and fit into the SEC’s historic frameworks. In general, Commissioner Roisman argued that the SEC should act by focusing on what information is material to an investment decision in the area of ESG.

KPMG, in their 2017 paper entitled “Environmental, social and governance (ESG) materiality assessment”, said, “to be valuable and credible, the development of ESG reporting practices depends on a holistic approach to […] material ESG matters, and not merely the extraction […] of historic ESG data.” However, KPMG sees the materiality assessment as broader in context and believes that it “should be used as a strategic business tool, with implications beyond corporate responsibility (CR) or sustainability reporting.”

A proposal for a seven-step approach to conducting a materiality assessment can be found in a newly published article on FCPA Compliance and Ethics.