Bill Overview
Title: Dodd-Frank Material Disclosure Improvement Act
Description: This bill eliminates disclosure requirements applicable to issuers of securities. Specifically, it eliminates requirements to disclose the ratio of an issuer's median employee pay to its Chief Executive Officer pay; the use of conflict minerals originating in the Democratic Republic of the Congo by the issuer; health and safety information of mines operated by the issuer; and payments by an oil, natural gas, or mineral extractor to a foreign government or to the federal government.
Sponsors: Sen. Cramer, Kevin [R-ND]
Target Audience
Population: Global population impacted by changes to disclosure requirements in securities issuance
Estimated Size: 50000000
- Investors rely on disclosures to make informed decisions about where to allocate resources; changes affect their trust and decisions.
- Employees in the companies affected are likely to be impacted by changes in reported pay ratios.
- Communities in regions where mining and resource extraction occur may see changes in corporate behavior or accountability due to lesser disclosures.
- Local and foreign governments may have reduced oversight on payments received from natural resource extraction.
- Responsibility for self-regulation increases among companies where disclosure requirements are reduced. This can affect management and compliance officers.
Reasoning
- We must consider a diverse range of perspectives linked to different socio-economic roles within the US economy, particularly investors, employees in the affected industries, and households with investments.
- The policy is likely to impact highly educated professionals in financial services differently compared to blue-collar workers in industries such as mining or oil and gas.
- The impact might be moderate to high for investors heavily reliant on transparency for decision-making, which could affect financial wellbeing and trust in markets.
- Employees would see variable effects depending on their role and understanding of corporate conduct, with potential implications for perceived equity within organizations.
- Communities dependent on or influenced by resource extraction industries might experience altered corporate accountability, affecting their economic and environmental wellbeing.
Simulated Interviews
Investment Advisor (New York, NY)
Age: 45 | Gender: female
Wellbeing Before Policy: 7
Duration of Impact: 20.0 years
Commonness: 4/20
Statement of Opinion:
- Elimination of these disclosures could reduce my clients' ability to make informed investment decisions.
- Lack of transparency may lead to increased skepticism towards company practices.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 7 |
| Year 2 | 6 | 7 |
| Year 3 | 6 | 7 |
| Year 5 | 6 | 7 |
| Year 10 | 5 | 7 |
| Year 20 | 5 | 7 |
Oil and Gas Engineer (Houston, TX)
Age: 38 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 10.0 years
Commonness: 6/20
Statement of Opinion:
- With less regulatory oversight, there might be job security concerns if anything goes wrong.
- Reduced transparency might increase internal pressure to self-regulate more effectively.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 6 |
| Year 2 | 6 | 6 |
| Year 3 | 5 | 6 |
| Year 5 | 5 | 6 |
| Year 10 | 4 | 6 |
| Year 20 | 4 | 6 |
Coal Miner (Pittsburgh, PA)
Age: 52 | Gender: male
Wellbeing Before Policy: 5
Duration of Impact: 5.0 years
Commonness: 7/20
Statement of Opinion:
- I'm not directly affected by disclosure changes, but my wellbeing could decline if corporation accountability is reduced.
- Safety information is crucial for us miners.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 5 |
| Year 2 | 5 | 5 |
| Year 3 | 5 | 4 |
| Year 5 | 4 | 4 |
| Year 10 | 4 | 4 |
| Year 20 | 3 | 3 |
Tech Industry Compliance Officer (San Francisco, CA)
Age: 29 | Gender: female
Wellbeing Before Policy: 8
Duration of Impact: 10.0 years
Commonness: 5/20
Statement of Opinion:
- This policy shift poses a decreased workload in terms of oversight, which can allow us to focus on other compliance areas.
- However, the overall confidence in corporate ethics might suffer.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 8 |
| Year 2 | 7 | 8 |
| Year 3 | 7 | 8 |
| Year 5 | 6 | 8 |
| Year 10 | 6 | 7 |
| Year 20 | 6 | 7 |
Public School Teacher (Chicago, IL)
Age: 35 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 20.0 years
Commonness: 8/20
Statement of Opinion:
- While my job isn't directly influenced, my investments are important for long-term security.
- Reduced disclosures make me worry about the ethical practices of companies in my portfolio.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 6 |
| Year 2 | 5 | 6 |
| Year 3 | 5 | 6 |
| Year 5 | 5 | 6 |
| Year 10 | 4 | 5 |
| Year 20 | 4 | 5 |
Pension Fund Manager (Boston, MA)
Age: 48 | Gender: female
Wellbeing Before Policy: 7
Duration of Impact: 20.0 years
Commonness: 3/20
Statement of Opinion:
- The removal of these disclosures complicates our ethical investment strategy.
- I foresee a possible reassessment of companies we currently invest in.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 7 |
| Year 2 | 5 | 7 |
| Year 3 | 5 | 7 |
| Year 5 | 4 | 7 |
| Year 10 | 4 | 6 |
| Year 20 | 3 | 6 |
Corporate Lawyer (Phoenix, AZ)
Age: 42 | Gender: female
Wellbeing Before Policy: 8
Duration of Impact: 10.0 years
Commonness: 6/20
Statement of Opinion:
- Such policy changes might reduce transparency, impacting corporate ethics.
- Internally, the firm might have to adopt more self-regulation practices.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 8 |
| Year 2 | 7 | 8 |
| Year 3 | 6 | 8 |
| Year 5 | 6 | 8 |
| Year 10 | 5 | 7 |
| Year 20 | 5 | 7 |
Retired Industrial Worker (Denver, CO)
Age: 54 | Gender: male
Wellbeing Before Policy: 5
Duration of Impact: 20.0 years
Commonness: 7/20
Statement of Opinion:
- As a retiree, there is concern over the stability of my pension investments without clear corporate disclosures.
- I fear that less transparency might compromise ethical company behaviors.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 4 | 5 |
| Year 2 | 4 | 5 |
| Year 3 | 3 | 5 |
| Year 5 | 3 | 5 |
| Year 10 | 3 | 4 |
| Year 20 | 3 | 4 |
Environmental Activist (Miami, FL)
Age: 31 | Gender: male
Wellbeing Before Policy: 8
Duration of Impact: 20.0 years
Commonness: 4/20
Statement of Opinion:
- These changes disrupt our efforts to hold companies accountable.
- The reduced transparency sets a worrying precedent for the industry.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 8 |
| Year 2 | 6 | 8 |
| Year 3 | 5 | 7 |
| Year 5 | 5 | 7 |
| Year 10 | 4 | 7 |
| Year 20 | 3 | 6 |
Tech Startup Employee (Seattle, WA)
Age: 27 | Gender: female
Wellbeing Before Policy: 7
Duration of Impact: 20.0 years
Commonness: 7/20
Statement of Opinion:
- As a young professional, I'm concerned about how my equity might be valued without proper disclosures.
- I also worry about the ethics of corporations I might work with.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 7 |
| Year 2 | 6 | 7 |
| Year 3 | 6 | 7 |
| Year 5 | 6 | 7 |
| Year 10 | 6 | 7 |
| Year 20 | 5 | 6 |
Cost Estimates
Year 1: $10000000 (Low: $5000000, High: $20000000)
Year 2: $8000000 (Low: $4000000, High: $16000000)
Year 3: $6000000 (Low: $3000000, High: $12000000)
Year 5: $5000000 (Low: $2500000, High: $10000000)
Year 10: $4000000 (Low: $2000000, High: $8000000)
Year 100: $0 (Low: $0, High: $0)
Key Considerations
- The balance between reduced administrative burden and the potential impact on market transparency and investor confidence.
- Potential shift in corporate behavior with the removal of certain disclosures.
- Effects on global reputation regarding transparency and ethical business conduct.