IB 

Union Calendar No. 290 

116TH CONGRESS 

2D SESSION H. R. 4329 

[Report No. 116–365] 

To provide for disclosure of additional material information about public 

companies and establish a Sustainable Finance Advisory Committee, and 

for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

SEPTEMBER 13, 2019 

Mr. VARGAS (for himself and Mr. GARCI ́A of Illinois) introduced the following 

bill; which was referred to the Committee on Financial Services 

JANUARY 7, 2020 

Reported with an amendment, committed to the Committee of the Whole 

House on the State of the Union, and ordered to be printed 

[Strike out all after the enacting clause and insert the part printed in italic] 

[For text of introduced bill, see copy of bill as introduced on September 13, 2019] 


pamtmann on DSKBC07HB2PROD with BILLS
2 

•HR 4329 RH

A BILL 

To provide for disclosure of additional material information 

about public companies and establish a Sustainable Finance Advisory Committee, and for other purposes. 


pamtmann on DSKBC07HB2PROD with BILLS
3 

•HR 4329 RH

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘ESG Disclosure Sim5 plification Act of 2019’’. 

6 SEC. 2. ESG DISCLOSURES. 

7 (a) IN GENERAL.—Section 14 of the Securities Ex8 change Act of 1934 (15 U.S.C. 78n) is amended by adding 

9 at the end the following: 

10 ‘‘(k) ESG DISCLOSURES.— 

11 ‘‘(1) IN GENERAL.—Each issuer the securities of 

12 which are registered under section 12 or that is re13 quired to file annual reports under section 15(d) shall 

14 disclose in any proxy or consent solicitation material 

15 for an annual meeting of the shareholders— 

16 ‘‘(A) a clear description of the views of the 

17 issuer about the link between ESG metrics and 

18 the long-term business strategy of the issuer; and 

19 ‘‘(B) a description of any process the issuer 

20 uses to determine the impact of ESG metrics on 

21 the long-term business strategy of the issuer. 

22 ‘‘(2) ESG METRICS DEFINED.—In this sub23 section, the term ‘ESG metrics’ has the meaning 

24 given the term in part 210 of title 17, Code of Federal 


pamtmann on DSKBC07HB2PROD with BILLS
4 

•HR 4329 RH

1 Regulations as amended pursuant to subsection (b) of 

2 the ESG Disclosure Simplification Act of 2019.’’. 

3 (b) RULEMAKING.— 

4 (1) IN GENERAL.—The Securities and Exchange 

5 Commission (in this Act referred to as the ‘‘Commis6 sion’’) shall amend part 210 of title 17, Code of Fed7 eral Regulations (or any successor thereto) to— 

8 (A) require each issuer, in any filing of the 

9 issuer described in such part that requires au10 dited financial statements, to disclose environ11 mental, social, and governance metrics (in this 

12 Act referred to as ESG metrics); and 

13 (B) define ESG metrics. 

14 (2) SUSTAINABLE FINANCE ADVISORY COM15 MITTEE.—The Sustainable Finance Advisory Com16 mittee established pursuant to section 4(k) of the Se17 curities and Exchange Act of 1934 shall, not later 

18 than 180 days after the date of the first meeting of 

19 such Committee, submit to the Commission rec20 ommendations about what ESG metrics the Commis21 sion should require issuers to disclose. 

22 (3) MATERIALITY.—It is the sense of Congress 

23 that ESG metrics, as such term is defined by the 

24 Commission pursuant to paragraph (2), are de facto 

25 material for the purposes of disclosures under the SeVerDate Sep 11 2014 00:06 Jan 08, 2020 Jkt 099200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6203 E:\BILLS\H4329.RH H4329

pamtmann on DSKBC07HB2PROD with BILLS
5 

•HR 4329 RH

1 curities Exchange Act of 1934 and the Securities Act 

2 of 1933. 

3 (4) INCORPORATION OF INTERNATIONAL STAND4 ARDS.—When amending part 210 of title 17, Code of 

5 Federal Regulations (or any successor thereto) pursu6 ant to paragraph (1), the Commission may, as the 

7 Commission determines appropriate, incorporate any 

8 internationally recognized, independent, multi-stake9 holder environmental, social, and governance disclo10 sure standards. 

11 (5) LOCATION OF DISCLOSURE.—Any disclosure 

12 required by paragraph (1) may be included in a notes 

13 section of the filing. 

14 (6) DELAY FOR SMALL ISSUERS.—The Commis15 sion may use a phased approach when applying any 

16 amendments made pursuant to paragraph (1) to 

17 small issuers and may determine the criteria by 

18 which an issuer qualifies as a small issuer for pur19 poses of such phased approach. 

20 SEC. 3. SUSTAINABLE FINANCE ADVISORY COMMITTEE. 

21 Section 4 of the Securities Exchange Act of 1934 (15 

22 U.S.C. 78d) is amended by adding at the end the following: 

23 ‘‘(k) SUSTAINABLE FINANCE ADVISORY COMMITTEE.— 

24 ‘‘(1) ESTABLISHMENT.—The Securities and Ex25 change Commission (in this subsection referred to as 


pamtmann on DSKBC07HB2PROD with BILLS
6 

•HR 4329 RH

1 the ‘Commission’) shall establish a permanent advi2 sory committee to be called the ‘Sustainable Finance 

3 Advisory Committee’ (in this subsection referred to as 

4 the ‘Committee’). 

5 ‘‘(2) DUTIES OF COMMITTEE.—The Committee 

6 shall— 

7 ‘‘(A) submit a report to the Securities and 

8 Exchange Commission not later than 18 months 

9 after the date of the first meeting of the Com10 mittee that— 

11 ‘‘(i) identifies the challenges and op12 portunities for investors associated with sus13 tainable finance; and 

14 ‘‘(ii) recommends policy changes to fa15 cilitate the flow of capital towards sustain16 able investments, in particular environ17 mentally sustainable investments; 

18 ‘‘(B) when solicited, advise the Commission 

19 on sustainable finance; and 

20 ‘‘(C) communicate with individuals and en21 tities with an interest in sustainable finance. 

22 ‘‘(3) MEMBERSHIP.— 

23 ‘‘(A) MEMBERS.— 


pamtmann on DSKBC07HB2PROD with BILLS
7 

•HR 4329 RH

1 ‘‘(i) IN GENERAL.—The Committee 

2 shall consist of no more than 20 members 

3 who shall each serve for one four-year term. 

4 ‘‘(ii) REPRESENTATION.—Each mem5 ber shall represent individuals and entities 

6 with an interest in sustainable finance, 

7 such as— 

8 ‘‘(I) experts on sustainable fi9 nance; 

10 ‘‘(II) operators of financial infra11 structure; 

12 ‘‘(III) entities that provide anal13 ysis, data, or methodologies that facili14 tate sustainable finance; 

15 ‘‘(IV) insurance companies, pen16 sion funds, asset managers, depository 

17 institutions, or credit unions; or 

18 ‘‘(V) other financial institutions 

19 that intermediate investments in sus20 tainable finance or manage risks re21 lated to sustainable development. 

22 ‘‘(iii) REPRESENTATION OF INTER23 ESTS.—A member may not represent a sin24 gle individual or entity and shall represent 


pamtmann on DSKBC07HB2PROD with BILLS
8 

•HR 4329 RH

1 types of individuals and entities with simi2 lar interests in sustainable finance. 

3 ‘‘(B) SELECTION.— 

4 ‘‘(i) IN GENERAL.—The Commission 

5 shall— 

6 ‘‘(I) publish criteria for selection 

7 of members on the website of the Com8 mission and in the Federal Register; 

9 and 

10 ‘‘(II) solicit applications for mem11 bership on the website of the Commis12 sion and in the Federal Register. 

13 ‘‘(ii) EQUAL SHARE.—From the indi14 viduals who submit applications for mem15 bership, each Commissioner of the Commis16 sion shall select an equal number of the 

17 members of the Committee. 

18 ‘‘(C) PAY.—Members may not receive pay 

19 by reason of their service on the Committee but 

20 may receive travel or transportation expenses in 

21 accordance with applicable provisions under sub22 chapter I of chapter 57 of title 5, United States 

23 Code. 

24 ‘‘(D) MEMBER TRANSPARENCY.—The name 

25 of each member and the types of individuals and 


pamtmann on DSKBC07HB2PROD with BILLS
9 

•HR 4329 RH

1 entities that such member represents shall be 

2 published on the website of the Commission. 

3 ‘‘(E) STAFF.—The Committee shall be sup4 ported by staff from the Office of the Investor 

5 Advocate of the Commission that are dedicated to 

6 environmental, social and governance (in this 

7 subsection referred to as ‘ESG’) issues. 

8 ‘‘(F) AUTHORIZATION OF APPROPRIA9 TION.—There are authorized to be appropriated 

10 such sums as are necessary to finance costs asso11 ciated with staff dedicated to ESG issues in the 

12 Office of the Investor Advocate of the Commis13 sion. 

14 ‘‘(4) SUSTAINABLE FINANCE.—For the purposes 

15 of this subsection, the term ‘sustainable finance’ 

16 means the provision of finance with respect to invest17 ments taking into account environmental, social, and 

18 governance considerations. 

19 ‘‘(5) SEC RESPONSE.—The Commission shall, 

20 not later than 6 months after the date on which the 

21 Committee submits a report to the Commission pur22 suant to paragraph (2)(A), publish a response to such 

23 report.’’. 


pamtmann on DSKBC07HB2PROD with BILLS
Union Calendar No. 290 

116TH CONGRESS 

2D SESSION H. R. 4329 

[Report No. 116–365] 

A BILL 

To provide for disclosure of additional material infor other purposes. Sustainable Finance Advisory Committee, and formation about public companies and establish a 

JANUARY 7, 2020 

Reported with an amendment, committed to the Comand ordered to be printed mittee of the Whole House on the State of the Union, 


pamtmann on DSKBC07HB2PROD with BILLS