The House of the Congress narrowly passed ESG legislation last week.

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The House of the Congress narrowly passed ESG legislation last week. ESG reporting would require US public companies to report their material Environmental, Social and Governance (ESG) risks to the Securities and Exchange Commission (SEC). The House Financial Services Chairwoman‚ Maxine Waters made the point that ESG ¢â‚¬Å“will create clear, consistent disclosure standards for issuers and finally provide investors and our markets with the information they need to make the best investment decisions possible and to hold the companies theyre invested in accountable,¢â‚¬Â

ESG has been well reported, much has been said about the ‘E’ of not so the ‘S’ and ‘G’. However for those concerned about cyber, the SEC is working on Cyber Risk Governance, as listed in its 2021 regulatory agenda. With the Recent EOs on SCRM and cyber signed by the President of the US, increased regulatory reporting on cyber governance is very likely. As one of the largest material risks facing companies one investor groups have been calling for increased disclosure.

Public manufacturing firms and specifically US Defence manufacturing firms should be concerned. If this happens then the regulatory burden of cyber will rise. CMMC has stalled, but it is expected to get back on track by September 2021, if ESG includes cyber risk governance, then investor reporting of cyber risks will be required. At a time when the DoD and congress are aware that contractors are not managing the risk.

As the Former Group VP of Cyber Risk for Europe’s Largest Bank and a CISO I’ve sat in front of Japanese banking regulators, Sarbanes Oxley and the US banking regulators, I understand all to well the authority of the SEC and financial markets. S&P and Moody’s will be paying close attention as will insurance companies and disruptive investors.

How will public companies address the regulatory burden. Demonstrating they are managing, what is known to be a difficult and challenge risk, as the cyber insurance industry is now finding out?

Ted Dziekanowski Brian McCarthy Jason Spezzano

#cybersecurity‚ #SupplyChainRiskManagement‚ #CyberRiskManagement‚ #riskmanagement‚ #compliance‚ #insurance‚ #cyberinsurance‚ #insurance‚ #regulatorycompliance‚ #regulatoryoversight‚ #esgrisk‚ #cyberregulation‚ #esgreporting

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