The SEC’s enforcement action against Activision Blizzard in interesting and has important implications. For starters, as the Akin Gump law firm put it in its memo about the SEC’s action, the action “indicates that the SEC views its ESG mandate to include the ‘S’ as well as the ‘E’”. The Katten Muchin firm, in its memo about the case, said that the action not only represents an “exceptionally broad interpretation” of the securities laws, but it also shows the agency’s “increasing willingness to investigate and charge alleged violations of all ‘ESG’ elements, not just the environmental disclosures that have attracted the most public scrutiny.”
The resolution of this case, as the Akin Gump memo puts it, “marks the first time the SEC has imposed disclosure control violations on a public company that are related entirely to workplace-specific issues.” Moreover, the size of the settlement, at $35 million, sends a “clear signal” that the SEC is taking an “aggressive approach to enforcing workplace-related disclosures.”
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