December 14, 2015

SEC Proposes Resource Extraction Rules (Again)

On Friday, as required by Dodd-Frank, the SEC proposed rules – Rule 13q-1 – that would require resource extraction companies to disclose payments made to the federal government or foreign governments for the commercial development of oil, natural gas or minerals. Here’s the 202-page proposing release. We’ll be posting memos in our “Resource Extraction” Practice Area (see this Gibson Dunn blog for a summary).

This is the second time around for these rules. Rule 13q-1 was initially adopted by the SEC in 2012 – but it was subsequently vacated the next year by the DC U.S. District Court. Then, the SEC was sued for not adopting these rules fast enough – and a court ordered that the SEC move on these rules. As noted in the SEC’s press release, the EU and Canada have adopted transparency initiatives similar to the rules the SEC originally adopted.

The proposal has a two-step comment process: comments directly in response to this proposal are due by January 25th – and “reply” comments, responding only to issues raised during the original proposal’s comment period, are due by February 16th. In drafting its final rules, the SEC can rely on both new comments and comments that were received on the original proposal.

This Cooley blog and Stinson Leonard blog end with an analysis of whether this rulemaking will be challenged in court (again).

In his dissent, Commissioner Piwowar quoted rapper Eminem…

ESG Guide for Investors

Under the theory that even current publicly available information can help investors better manage ESG risks and opportunities, CFA Institute recently published this noteworthy Environmental, Social, and Governance Issues in Investing Guide for Investment Professionals.

The Guide deliberately sidesteps taking firm positions on certain, currently debated issues, e.g., the association between ESG considerations and financial performance; the “right” perspective or approach for considering ESG issues; whether particular issues are more appropriately classified as only Environmental, Social or Governance. Instead, while it notes areas of current debate on ESG issues, the Guide mainly seeks to educate investors about ESG considerations – making a good case for the notion that investors’ systematic consideration of ESG issues – even based on currently and evolving available information – will likely improve their investment analyses and enable better informed investment decision-making.

See also CFA’s blog about the Guide.

How Companies Manage Corporate Political Spending

This recent report from The Conference Board outlines the key issues for companies relevant to engaging in political activity and suggests various approaches to corporate political spending, disclosure and accountability.  Particularly noteworthy are the discussions about board oversight/role of the board and disclosure approaches, and the accompanying examples of board oversight structures and disclosures about their engagement made by Campbell Soup, Microsoft, Noble Energy and others.

See also the Center for Political Accountability’s new Board Member’s Guide to Corporate Political Spending, and heaps of additional resources in our “Political Contributions” Practice Area.

More on “The Mentor Blog”

We continue to post new items daily on our blog – “The Mentor Blog” – for members. Members can sign up to get that blog pushed out to them via email whenever there is a new entry by simply inputting their email address on the left side of that blog. Here are some of the latest entries:

– Audit Committee Resource Guide
– Audit Committee Financial Experts: Remoteness Linked to Poorer Earnings Quality
– Federal District Court vs. ALJ: What’s the Difference?
– Audit Committee Role in Internal Investigations
– Non-GAAP Measures: Non-Recurring Items


– by Randi Val Morrison