The New York Stock Exchange (NYSE) is considering standards for a new type of company – Natural Asset Companies (NACs). The proposal is intended to create a new asset/investment classification for companies that actively manage, maintain, restore, and grow the value of natural assets and their production of ecosystem services. Lawrence recently blogged about the NYSE proposal and what the standards for NACs would entail. The NYSE’s proposal was filed with the SEC on September 27, 2023, and published for comment in the Federal Register on October 4, 2023.
The SEC’s timeline for approving or disapproving the rule was fast approaching when the Commission announced its decision to extend the timeline an additional 45 days:
“the Commission will either approve the proposed rule change, disapprove the proposed rule change, or institute proceedings to determine whether the proposed rule change should be disapproved. The 45th day after publication of the notice for this proposed rule change is November 18, 2023. The Commission is extending this 45-day time period. The Commission finds it appropriate to designate a longer period within which to issue an order approving or disapproving the proposed rule change, so that it has sufficient time to consider the proposed rule change.”
We will have to wait until next year to hear the final status of the new listing standard. NACs would provide a unique opportunity for those looking to invest in nature-based solutions. Assuming the final version is similar to the proposal, the stringent listing standards should help give investors confidence in a new sustainable investment class and better set financial values for ecosystems and nature-based assets. On the other hand, it has yet to be seen how much of a market demand there may be for NACs.
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