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Making Sustainability Disclosure Sustainable

August 2020

Citation: ELR 10638

Author: Jill E. Fisch

The extent to which corporations should incorporate sustainability objectives into their operational decisionmaking is highly contested, as is the relationship between societal impact and economic value. At the same time, issuers are incorporating sustainability considerations into their business operations in response both to investor demands and to the claim that sustainable business practices lead to improved economic performance. Although the focus on increasing sustainability disclosure is accelerating both in the United States and globally, investors continue to report dissatisfaction with existing disclosures. This Article proposes a solution—mandating a Sustainability Discussion and Analysis (SD&A) as part of an issuer’s annual report to shareholders. The SD&A would be modeled after existing Management Discussion and Analysis and Compensation Discussion and Analysis and would reflect a similar principles based approach to those provisions.

Jill E. Fisch is the Saul A. Fox Distinguished Professor of Business Law at the University of Pennsylvania Law School.

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