SEC appoints Climate Counsel to lead policy on climate-related financial risks

US regulator also names Domini engagement specialist as part of policy team hires

The US Securities and Exchange Commission (SEC) has hired a climate advisor for its policy team, in yet another sign the regulator is stepping up on its management of sustainability factors in the US market.

In an announcement on Friday, SEC Chair Gary Gensler named advisor Mika Morse as Climate Counsel to lead policy efforts on climate-related financial risk. The appointment comes just a month after the SEC closed a consultation on corporate climate risk disclosures. 

Morse is a former Senior Counsel and Deputy Legislative Director for US Democrat Senator Brian Schatz, where she helped develop and implement the Senator's legislative priorities on the Banking, Commerce and Appropriations Committees.

Also named among the policy team’s five hires was Domini Impact Investments’ Director of Engagement, Corey Klemmer, who leaves the US SRI house after two and half years to become Corporation Finance Counsel at the SEC. The role will see her focus on drafting policies that will provide investors with the “material information” they need from companies.

The SEC’s five commissioners have disagreed, largely along political lines, about the definition of ‘materiality’ it should adopt when it comes to disclosure requirements for companies around sustainability. Some commissioners want to limit the definition to ESG factors that might hurt financial returns, while others want a broader definition that incorporates the risks that business activities pose to the environment and society. 

Both Morse and Klemmer will work under the SEC’s Policy Director, Heather Slavkin Corzo. Corzo, a well-known corporate governance specialist in the US, who was Head of US Policy at the Principles for Responsible Investment for three years, was only appointed to her role in April by Gensler – a move that was seen by many at the time as a sign that the regulator was going to pursue progressive policy goals.