Gensler Expected to Take Tough Stance on Corporate Issues
On Wednesday, April 14, 2021, the Senate confirmed President Biden’s nomination, Gary Gensler, as chairman of the SEC in a 53-45 vote. Although Gensler steps into this role to serve the remainder of predecessor Jay Clayton’s term, ending June 5th, the Senate Banking Committee intends to give Gensler a five-year term after June 5, 2021. Gensler’s experience as the former head of the Commodity Futures Trading Commission (CFTC) during the 2007- 2008 financial crisis, and as the assistant secretary of the U.S. Department of the Treasury, made him an attractive nominee to lead the SEC. Gensler’s confirmation gives Democrats a 3-2 majority on the commission.
A former executive at Goldman Sachs for 18 years, Gensler comes to the SEC with a financial agenda: to maintain fair, orderly, and efficient markets, and to facilitate capital formation. Gensler’s reputation as a tough regulator precedes him as he is expected to continue his priorities of strengthening transparency and accountability in the markets.
Gensler is expected to reverse prior rulemaking priorities that were friendly to businesses. Despite this, he pledges to take a bipartisan approach to the SEC amidst political division. All eyes will be on Gensler as he takes office; environmental, social, and governance (ESG) related disclosure violations, corporate issuers, meme stocks, cryptocurrencies, insider trading, and political spending are all on the table, and you can expect Gensler to take a tough stance on these issues. Gensler’s SEC will likely bring about proactive rulemaking all while doubling down on violations.