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The Senate confirmed Gary Gensler, President Biden’s choice, on Wednesday as chairman of the Securities and Exchange Commission.
As he prepares to take up his post, Gensler is expected to prioritize climate change and cryptocurrencies, among other things.
Coincidentally, his confirmation came on the same day when Coinbase, now the largest listed cryptocurrency company, celebrated its direct listing on the Nasdaq, which was greeted with huge demand ending with a first-day gain of 31%.
COIN BASE PRINTS NASDAQ DEBUT
| Ticker | Safety | Last | Alter | Alter% |
|---|---|---|---|---|
| COIN | COINBASE GLOBAL INC. | 328.28 | +78.28 | + 31.31% |
Gensler, who recently served as a professor at the Massachusetts Institute of Technology (MIT), is seen as having a greater understanding of the asset class compared to previous SEC chairmen.
Hester Peirce on cryptocurrency
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On climate change, Gensler expressed support for the SEC’s use to promote greater disclosure requirements that promote ESG – which stands for environment, social and governance – a movement for shareholder activism around companies that are publicly traded, to strive for social change.
“There are tens of trillions of investor dollars looking for more information on climate risk,” Gensler told the Committee on Banking, Housing and Urban Affairs.
Gensler has repeatedly stated that he would limit disclosure requirements to ‘material’ matters for investors, but said: “It is the investing community that can decide what is material.”
However, West Virginia Attorney General Patrick Morrisey warned in a letter dated March 25 that the agency overseeing companies that are publicly traded is likely to get back pressure.
“This is federal overreaction and political activism at its worst,” Morrisey wrote. “West Virginia citizens will not support efforts to allow ‘mission creep’ into all federal agencies, simply to advance a president’s political agenda. For example, if you make statements that are not related to protection. ‘against fraud, ignore what is already publicly accessible. market sensitive issues, and unnecessarily turn security into political activism.’
Morrisey continues. “If the commission follows this path, states and other stakeholders will not hesitate to go to court to enforce a federal regulation that violates the first amendment.”
Acting Chairman Allison Herren Lee has already set up the SEC Division of Enforcement of the Climate and ESG Task Force to ‘detect climate and ESG-related misconduct’ and is expected to remain as commissioner.
Advocates of ESG are likely to try to expand the definition of material as far as possible, said Richard Morrison, a research fellow at the Competitive Enterprise Institute, a free-market think tank. But he said Gensler could be more moderate than Lee.
“Gensler seems receptive to the ideas, but apparently does not have the fire-in-the-belly motivation and energy like Lee,” Morrison told FOX Business. “I am concerned that he will deviate from the SEC’s tradition of dualism by using the agency’s regulatory powers to promote a liberal social agenda on issues such as climate change, political spending and racial inequality,” the committee member said. Senator Pat Toomey. , R-Pa., Said before his vote against Gensler’s nomination. “The security laws are not the right means to address social and cultural issues.”
In addition, the ESG agenda overlaps with other agencies, he said.
“For environmental regulation, you have the EPA. You have the Environmental Quality Council,” Morrison said. “For workplace discrimination, you have the Equal Employment Opportunity Commission and the Division of Civil Rights of the Department of Justice. Even if the federal government were to do all this, it is not clear that the SEC should be involved.”
Both the AFL-CIO and the U.S. Chamber of Commerce boosted the nomination of Gensler, formerly best known as President Barack Obama’s chairman of the Commodity Futures Trading Commission (CFTC) from 2009 to 2014.
The AFL-CIO noted Gensler’s prominent role in two of the most important financial regulation bills of the past two decades.
“While other regulators have slowed down, the CFTC, led by Mr. Gensler completed most of the required rules under the Dodd-Frank Wall Street Reform and Consumer Protection Act, ‘reads the letter from William Samuel, director of government affairs for the AFL-CIO. “And earlier in his career as senior adviser to Senator Paul Sarbanes, Mr. Gensler helped draft the Sarbanes-Oxley Act to address the corporate accounting scandals of the Enron and WorldCom eras.”
Meanwhile, the confirmation hearing appeared to show that Gensler “has a strong understanding of ‘materiality’ for disclosure,” Neil Bradley, executive vice president of the U.S. Chamber of Commerce, wrote in a letter to committee members.
“His experience will be critical to ensuring that businesses, especially small and emerging growth industries, have access to the necessary capital so that they can grow and enable a strong economic recovery,” Bradley wrote.