Last month Keith F. Higgins, the Director of the SEC’s Division of Corporation Finance (the “Division”), discussed the SEC’s plans to make its disclosure regime more effective. As theRacetotheBottom pointed out, Higgins’ speech marked a change in what had been the SEC’s original approach to reforming its disclosure policy. According to theRacetotheBottom, the SEC initially set out to examine what it perceived to be disclosure “overload.”
But in his speech, Higgins outlined something which more closely resembles a dialogue. First, the Division will review specific sections of Regulation S-K and S-X to determine if the requirements can be updated to reduce the costs and burdens and eliminate duplicative disclosures. It will also examine whether there is information that ought to be disclosed but currently is not. As part of this process the Division intends to seek considerable public comment and to that end has launched a spotlight page where companies, investors and other market participants may voice their views.
Specific areas to be reviewed include whether Industry Guides and form-specific disclosure requirements should be updated and perhaps codified in Regulation S-K; how investors use the separate financial statements submitted under Regulation S-X; and harmonizing the disclosure required under Securities Act rules with those of the Securities Exchange Act. View Financial Executives International Daily’s summary of Higgins’ speech here.