28 Jun 2022 2 min read

US markets need climate data to thrive

By Investment Stewardship team

Aaron Meder, CEO of LGIM America, looks at how the SEC's proposed climate disclosure rule could help improve the quality of information available to investors.


The following is a summary of a full blog available on Barron’s.

The availability and accuracy of information is the lifeblood of successful markets. Regardless of your views on climate change, companies are already making claims and altering strategies to transition into a low-carbon world. Today, one in three S&P 500 companies has a net-zero strategy. If our goal is to manage the transition toward net zero as effectively as possible, we need to move away from a world where climate data is sparse and inconsistent, and toward one where climate disclosures support investment decision-making.

The US disclosure landscape does not, however, currently make available relevant climate risk information investors need. As a result, there are important cross-border incompatibilities and inconsistencies in the level of disclosure between climate risk and other forms of financial risk, leading to potential mispricing of securities.

The long-awaited climate risk disclosure rule proposed by the U.S. Securities and Exchange Commission would contribute to achieving this aim by providing investors with accessible, decision-useful data and information about relevant financial risks.

By establishing climate risk disclosure reporting, the SEC’s proposal helps to level the playing field for investors and companies alike, ensuring investors have better information to make long-term investment decisions. With climate-related financial risks only increasing and investors and regulators across the world mobilising on climate-related disclosures, the SEC’s proposed standards represent an opportunity that US markets cannot afford to miss.

To read the full blog, please visit Barron’s website.

Investment Stewardship team


Our Investment Stewardship team comprises professionals with experience in areas including responsible investment, corporate governance, and public policy. The team is made up of both sector specialists and experts on ESG themes, such as sustainability, and has a global remit with members in the UK, Japan and the US. The team exercises LGIM’s voting rights globally, holding companies to account. In 2020, LGIM cast over 138,600 votes at over 14,000 meetings.

Investment Stewardship team