The SEC Wants Companies To Disclose How Climate Change is Affecting Them

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The U.S. Securities and Exchange Commission is proposing new rules that would for the first time require businesses to report their greenhouse gas emissions, along with details of how climate change is affecting their businesses.

"Our core bargain from the 1930s is that investors get to decide which risks to take, as long as public companies provide full and fair disclosure and are truthful in those disclosures," Gensler said."That principle applies equally to our environmental-related disclosures."If the regulators approve the rules, companies would be required to provide climate-related information when they register as public companies with the SEC, and also in annual filings.

"Scope 3" emissions have proved to be more controversial. They are emissions generated by a company's suppliers and customers. Many companies and trade groups, including the U.S. Chamber of Commerce, have opposed mandated reporting of Scope 3 emissions saying it would be too burdensome and complicated to estimate emissions across a company's operations.

 

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