New Delhi, Nov. 13 -- In a recent Financial Times commentary, US Securities and Exchange Commission (SEC) chairman Paul Atkins argued that "the SEC should only require companies to supply information under the objective standard of whether a reasonable investor would regard it as important to an investment decision. Rules written for shareholders who seek to effect social change or have motives unrelated to maximizing the financial return on their investment fail this test-and fail investors."

At face value, Atkins' statement seems unexceptional. But it leaves open a key question: What is material to a firm's financial performance?

Atkins suggests that disclosure should not be driven by "political fads or distorted objectives," citing t...