H.R. 4759

[Congressional Bills 118th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4759 Introduced in House (IH)]

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118th CONGRESS
1st Session
H. R. 4759

To provide for disclosure of additional material information about 
public companies, and for other purposes.

_______________________________________________________________________

IN THE HOUSE OF REPRESENTATIVES

July 19, 2023

Mr. Vargas (for himself and Mr. Casten) introduced the following bill; 
which was referred to the Committee on Financial Services

_______________________________________________________________________

A BILL

To provide for disclosure of additional material information about 
public companies, and for other purposes.

Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

This Act may be cited as the ``Environmentally Sustainable Growth 
Act of 2023''.

SEC. 2. FINDINGS.

Congress finds the following:
(1) The Securities and Exchange Commission has broad 
authority to require the disclosure of information if such 
information is in the interest of, or is material to investors.
(2) The Commission does not require companies to disclose 
information related to environmental, social, and governance 
(``ESG'') matters, and does not require companies to adhere to 
standards for disclosing such information.
(3) Investors have reported that voluntary disclosures of 
ESG metrics are inadequate.
(4) A rule requiring reporting and standardization of ESG 
disclosures is in the interest of investors.
(5) ESG matters are material to investors, and the 
Commission must establish standards for disclosure of such 
matters.

SEC. 3. ESG DISCLOSURES.

(a) In General.--Section 14 of the Securities Exchange Act of 1934 
(15 U.S.C. 78n) is amended by adding at the end the following:
``(l) ESG Disclosures.--
``(1) In general.--Each issuer the securities of which are 
registered under section 12 or that is required to file annual 
reports under section 15(d) shall disclose in any proxy or 
consent solicitation material for an annual meeting of the 
shareholders--
``(A) a clear description of the views of the 
issuer about the link between ESG metrics and the long-
term business strategy of the issuer; and
``(B) a description of any process the issuer uses 
to determine the impact of ESG metrics on the long-term 
business strategy of the issuer.
``(2) ESG metrics defined.--In this subsection, the term 
`ESG metrics' has the meaning given the term in part 210 of 
title 17, Code of Federal Regulations as amended pursuant to 
section 3(b) of the ESG Disclosure Simplification Act of 
2021.''.
(b) Rulemaking.--
(1) In general.--The Securities and Exchange Commission (in 
this Act referred to as the ``Commission'') shall amend part 
210 of title 17, Code of Federal Regulations (or any successor 
thereto) to--
(A) require each issuer, in any filing of the 
issuer described in such part that requires audited 
financial statements, to disclose environmental, 
social, and governance metrics (in this Act referred to 
as ESG metrics); and
(B) define ESG metrics.
(2) Sustainable finance advisory committee.--The 
Sustainable Finance Advisory Committee of the Commission shall, 
not later than 180 days after the date of the first meeting of 
such Committee, submit to the Commission recommendations about 
what ESG metrics the Commission should require issuers to 
disclose.
(3) Materiality.--It is the sense of Congress that ESG 
metrics, as such term is defined by the Commission pursuant to 
paragraph (1), are de facto material for the purposes of 
disclosures under the Securities Exchange Act of 1934 and the 
Securities Act of 1933.
(4) Incorporation of international standards.--When 
amending part 210 of title 17, Code of Federal Regulations (or 
any successor thereto) pursuant to paragraph (1), the 
Commission may, as the Commission determines appropriate, 
incorporate any internationally recognized, independent, multi-
stakeholder environmental, social, and governance disclosure 
standards.
(5) Location of disclosure.--Any disclosure required by 
paragraph (1) may be included in a notes section of the filing.
(6) Delay for small issuers.--The Commission may use a 
phased approach when applying any amendments made pursuant to 
paragraph (1) to small issuers and may determine the criteria 
by which an issuer qualifies as a small issuer for purposes of 
such phased approach.

SEC. 4. SUSTAINABLE FINANCE ADVISORY COMMITTEE.

Section 4 of the Securities Exchange Act of 1934 (15 U.S.C. 78d) is 
amended by adding at the end the following:
``(l) Sustainable Finance Advisory Committee.--
``(1) Establishment.--The Commission shall establish a 
permanent advisory committee to be called the `Sustainable 
Finance Advisory Committee' (in this subsection referred to as 
the `Committee').
``(2) Duties of committee.--The Committee shall--
``(A) submit a report to the Commission not later 
than 18 months after the date of the first meeting of 
the Committee that--
``(i) identifies the challenges and 
opportunities for investors associated with 
sustainable finance; and
``(ii) recommends policy changes to 
facilitate the flow of capital towards 
sustainable investments, in particular 
environmentally sustainable investments;
``(B) when solicited, advise the Commission on 
sustainable finance; and
``(C) communicate with individuals and entities 
with an interest in sustainable finance.
``(3) Membership.--
``(A) Members.--
``(i) In general.--The Committee shall 
consist of no more than 20 members who shall 
each serve for one four-year term.
``(ii) Representation.--Each member shall 
represent individuals and entities with an 
interest in sustainable finance, such as--
``(I) experts on sustainable 
finance;
``(II) operators of financial 
infrastructure;
``(III) entities that provide 
analysis, data, or methodologies that 
facilitate sustainable finance;
``(IV) insurance companies, pension 
funds, asset managers, depository 
institutions, or credit unions; or
``(V) other financial institutions 
that intermediate investments in 
sustainable finance or manage risks 
related to sustainable development.
``(iii) Representation of interests.--A 
member may not represent a single individual or 
entity and shall represent types of individuals 
and entities with similar interests in 
sustainable finance.
``(B) Selection.--
``(i) In general.--The Commission shall--
``(I) publish criteria for 
selection of members on the website of 
the Commission and in the Federal 
Register; and
``(II) solicit applications for 
membership on the website of the 
Commission and in the Federal Register.
``(ii) Equal share.--From the individuals 
who submit applications for membership, each 
Commissioner of the Commission shall select an 
equal number of the members of the Committee.
``(C) Pay.--Members may not receive pay by reason 
of their service on the Committee but may receive 
travel or transportation expenses in accordance with 
applicable provisions under subchapter I of chapter 57 
of title 5, United States Code.
``(D) Member transparency.--The name of each member 
and the types of individuals and entities that such 
member represents shall be published on the website of 
the Commission.
``(E) Staff.--The Committee shall be supported by 
staff from the Office of the Investor Advocate of the 
Commission that are dedicated to environmental, social 
and governance (in this subsection referred to as 
`ESG') issues.
``(F) Authorization of appropriation.--There are 
authorized to be appropriated such sums as are 
necessary to finance costs associated with staff 
dedicated to ESG issues in the Office of the Investor 
Advocate of the Commission.
``(4) Sustainable finance.--For the purposes of this 
subsection, the term `sustainable finance' means the provision 
of finance with respect to investments taking into account 
environmental, social, and governance considerations.
``(5) SEC response.--The Commission shall, not later than 6 
months after the date on which the Committee submits a report 
to the Commission pursuant to paragraph (2)(A), publish a 
response to such report.''.
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