Financial Reporting Law to Advance in the HouseBy
Democrats in the U.S. House of Representatives are pushing legislation to expand corporate financial reporting requirements to include data on human resources issues.
The House Financial Services Subcommittee on Investor Protection, Entrepreneurship, and Capital Markets held hearings on four bills on May 18, 2019. One would require new disclosures about human capital management in annual reports; another would mandate new disclosures about the total number of domestic and foreign employees of a company; the third would expand current pay-ratio disclosures; and the fourth would add disclosures about stock buybacks.
Labor unions are advocating for passage of the bills. Heather Slavkin Corzo, director of capital markets policy at the AFL-CIO, told the subcommittee that the disclosures “would enable investors to make informed investment decisions based on the trends in a company’s workforce, and to better assess the competitiveness and productivity of companies.”
While Democrats can pass all four bills in the Democrat-controlled House, they’ll need support in the Senate from Republicans. That isn’t likely to happen. Rep. Trey Hollingsworth (R.-Ind.) read a statement for Rep. Bill Huizenga (R.-Mich.), the top Republican on the subcommittee, calling the new disclosures “hollow” and not material. Huizenga’s statement argued that forcing new disclosures on public companies would exacerbate the current problem of fewer small companies going public.