Does ESG Investing affect Regulatory Shareholding Disclosure for Asset Managers?

Post by Anna Monteiro, Head of North America Sales & Client Services

Asset managers are in lots of crosshairs with ESG Investing lately. At issue is the role of asset managers to seemingly go beyond their fiduciary duty (under ERISA to act prudently and focus on shareholder return) to “stakeholder capitalism”, whether intentional or not. Or, to suspect that these “woke” asset managers have an underlying tinge of “political agenda”. Add to this controversial mix is the problem of greenwashing of ESG investing.

Another interesting perspective is whether asset managers have been appropriately filing their regulatory shareholding disclosures for their ESG investments. This was recently addressed in a remark by US SEC Commissioner Mark T. Uyeda.

For instance, if an investor’s beneficial ownership exceeds 5% of a company’s total stock issue in the US, he will have to file a Schedule 13D or 13G form. Schedule 13G is a shorter version of Schedule 13D, but the filer must meet one of several exemptions. Chief among the exemptions for Schedule 13G is whether the filer acquired securities while doing normal business and has have no intention of influencing control of the issuer. The concern raised in ESG investing is the intent to influence control.

For example, asset managers complete proxy cards in the “for” or “against” voting of company directors for their security investments. With an ESG mandate now for their funds, does the manner in how the asset manager vote indicate an intent to influence control the company by the choice of that director to direct how the company is to engage in its own ESG approach?

The remark made by Commissioner Uyeda raises interesting questions for the filers, but no policy change was made – a moot point to take into consideration in respect to Shareholding Disclosure and impact of ESG disclosure. Still in its infancy, ESG regulatory disclosures are becoming a reality.

Regardless of whether you are filing Schedule 13D or 13G forms, the Artius Global Shareholding Disclosure solution – an automated, end-to-end shareholding disclosure solution with auto-form filling – can simplify your process of completing many of the regulatory forms, across  many of the 100+ jurisdictions.

This article references US SEC Commissioner Mark T. Uyeda remarks at the 2022 Cato Summit on Financial Regulation:


This website uses cookies to ensure you get the best experience on our website.