,i #aafth ,,congress #ast ,session ,h4 ,r4 #dcbi ,,in ,,the ,,house ,,of ,,representatives ,september #ac1 #bjai,mr4 ,vargas 7for himself and ,mr4 ,garca of ,illinois7 introduced the following bill2 which was referred to the ,committee on ,financial ,services ,a ,,bill ,to provide for disclosure of additional material information about public companies and establish a ,sustainable ,finance ,advisory ,committee1 and for other purposes4 #a4 ,short title ,this ,act may be cited as the ,,esg ,disclosure ,simplification ,act of #bjai4 #b4 ,,esg disclosures 7a7 ,in general ,section #ad of the ,securities ,exchange ,act of #aicd 7#ae ,u4,s4,c4 #ghn7 is amended by adding at the end the following3 7k7 ,,esg disclosures 7#a7 ,in general ,each issuer the securities of which are registered under section #ab or that is required to file annual reports under section #ae7;d7 shall disclose in any proxy or consent solicitation material for an annual meeting of the shareholders-- 7,a7 a clear description of the views of the issuer about the link between ,,esg metrics and the long-term business strategy of the issuer2 and 7,b7 a description of any process the issuer uses to determine the impact of ,,esg metrics on the long-term business strategy of the issuer4 7#b7 ,,esg metrics defined ,in this subsection1 the term ,,esg metrics has the meaning given the term in part #baj of title #ag1 ,code of ,federal ,regulations as amended pursuant to subsection 7b7 of the ,,esg ,disclosure ,simplification ,act of #bjai4 4 7b7 ,rulemaking 7#a7 ,in general ,the ,securities and ,exchange ,commission 7in this ,act referred to as the ,commission7 shall amend part #baj of title #ag1 ,code of ,federal ,regulations 7or any successor thereto7 to-- 7,a7 require each issuer1 in any filing of the issuer described in such part that requires audited financial statements1 to disclose environmental1 social1 and governance metrics 7in this ,act referred to as ,,esg metrics72 and 7,b7 define ,,esg metrics4 7#b7 ,sustainable ,finance ,advisory ,committee ,the ,sustainable ,finance ,advisory ,committee established pursuant to section #d7k7 of the ,securities and ,exchange ,act of #aicd shall1 not later than #ahj days after the date of the first meeting of such ,committee1 submit to the ,commission recommendations about what ,,esg metrics the ,commission should require issuers to disclose4 7#c7 ,materiality ,it is the sense of ,congress that ,,esg metrics1 as such term is defined by the ,commission pursuant to paragraph 7#b71 are de facto material for the purposes of disclosures under the ,securities ,exchange ,act of #aicd and the ,securities ,act of #aicc4 7#d7 ,incorporation of international standards ,when amending part #baj of title #ag1 ,code of ,federal ,regulations 7or any successor thereto7 pursuant to paragraph 7#a71 the ,commission may1 as the ,commission determines appropriate1 incorporate any internationally recognized1 independent1 multi-stakeholder environmental1 social1 and governance disclosure standards4 7#e7 ,location of disclosure ,any disclosure required by paragraph 7#a7 may be included in a notes section of the filing4 7#f7 ,delay for small issuers ,the ,commission may use a phased approach when applying any amendments made pursuant to paragraph 7#a7 to small issuers and may determine the criteria by which an issuer qualifies as a small issuer for purposes of such phased approach4 #c4 ,sustainable ,finance ,advisory ,committee ,section #d of the ,securities ,exchange ,act of #aicd 7#ae ,u4,s4,c4 #gh;d7 is amended by adding at the end the following3 7k7 ,sustainable ,finance ,advisory ,committee 7#a7 ,establishment ,the ,securities and ,exchange ,commission 7in this subsection referred to as the ,commission7 shall establish a permanent advisory committee to be called the ,sustainable ,finance ,advisory ,committee 7in this subsection referred to as the ,committee74 7#b7 ,duties of ,committee ,the ,committee shall-- 7,a7 submit a report to the ,securities and ,exchange ,commission not later than #ah months after the date of the first meeting of the ,committee that-- 7i7 identifies the challenges and opportunities for investors associated with sustainable finance2 and 7ii7 recommends policy changes to facilitate the flow of capital towards sustainable investments1 in particular environmentally sustainable investments2 7,b7 when solicited1 advise the ,commission on sustainable finance2 and 7,c7 communicate with individuals and entities with an interest in sustainable finance4 7#c7 ,membership 7,a7 ,members 7i7 ,in general ,the ,committee shall consist of no more than #bj members who shall each serve for one four-year term4 7ii7 ,representation ,each member shall represent individuals and entities with an interest in sustainable finance1 such as-- 7,i7 experts on sustainable finance2 7,,ii7 operators of financial infrastructure2 7,,iii7 entities that provide analysis1 data1 or methodologies that facilitate sustainable finance2 7,,iv7 insurance companies1 pension funds1 asset managers1 depository institutions1 or credit unions2 or 7,v7 other financial institutions that intermediate investments in sustainable finance or manage risks related to sustainable development4 7iii7 ,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 finance4 7,b7 ,selection 7i7 ,in general ,the ,commission shall-- 7,i7 publish criteria for selection of members on the website of the ,commission and in the ,federal ,register2 and 7,,ii7 solicit applications for membership on the website of the ,commission and in the ,federal ,register4 7ii7 ,equal share ,from the individuals who submit applications for membership1 each ,commissioner of the ,commission shall select an equal number of the members of the ,committee4 7,c7 ,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 #eg of title #e1 ,united ,states ,code4 7,d7 ,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 ,commission4 7,e7 ,staff ,the ,committee shall be supported by staff from the ,office of the ,investor ,advocate of the ,commission that are dedicated to environmental1 social and governance 7in this subsection referred to as ,,esg7 issues4 7,f7 ,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 ,commission4 7#d7 ,sustainable finance ,for the purposes of this subsection1 the term sustainable finance means the provision of finance with respect to investments taking into account environmental1 social1 and governance considerations4 7#e7 ,,sec ,response ,the ,commission shall1 not later than #f months after the date on which the ,committee submits a report to the ,commission pursuant to paragraph 7#b77;,a71 publish a response to such report4 4