When should issuers disclose social factors that impact credit quality?

Issuers should disclose social factors that impact credit quality at the time of bond issuance and in ongoing disclosures because these factors can significantly influence an issuer’s financial health and market perception over time. By providing this information up front during the bond issuance, investors are made aware of any relevant social issues that could affect the viability of the investment. Furthermore, ongoing disclosures allow issuers to keep stakeholders updated on changes that may arise, reflecting any new developments or shifts in social factors that could impact credit quality.

This approach ensures transparency and enables investors to make informed decisions based on the most current information available. Regular updates on social factors can also help to maintain investor confidence and foster a good relationship between the issuer and its stakeholders by demonstrating a commitment to open communication regarding credit risk factors.