The Securities and Exchange Commission’s recently issued guidance on cyber disclosures fails to provide useful and reliable disclosure and leaves companies uncertain, according to Commissioner Kara Stein, ThinkAdvisor writes.
Too Much Information Isn’t a Concern?
According to Stein, the SEC should form standards for disclosure based on categories and structured data, as this could reduce the cost of information and resolve uncertainty, the publication writes.
Additionally, Stein countered recent concerns about investors being overloaded with information from companies, according to ThinkAdvisor. She said that never has an investor complained of this during her time at the SEC — instead, they ask for more information, Stein says, according to the publication.
Stein highlighted the recent petition by asset managers, institutional investors, state treasurers and others for the SEC to create rules for environmental, social and governance information disclosure, ThinkAdvisor writes. The SEC should focus on how information is organized and fairly presented rather than on reducing information and worrying about overload, Stein said, according to the publication. The commision should, according to Stein, improve the system of disclosure and the end product to retain high standards, ThinkAdvisor writes.
Furthermore, the SEC should work towards standards that help provide useful information to investors as well as overseeing and encouraging a “robust information environment,” according to Stein, the publication writes.
Stein also touched upon her previous recommendation that the SEC create a Digital Disclosure Task Force, including analysts, academics, investors, technologists and companies, to use technology to create an up-to-date disclosure system, according to ThinkAdvisor.
