The U.S. Securities and Exchange Commission (SEC) is an independent federal government regulatory agency responsible for protecting investors, maintaining fair and orderly functioning of the securities markets, and facilitating capital formation.
It has a three-part mission: Protect investors. Maintain fair, orderly, and efficient markets. Facilitate capital formation.
Last month (September 2022), the Securities and Exchange Commission proposed long-awaited rules that would mandate enhanced climate-related disclosures by public companies. Enhanced environmental disclosure has been a topic of discussion within the SEC since the 1970s. More recently, with the January 2021 change-over in administration and the resulting shift in rulemaking philosophy, climate disclosure has been an area of increasing SEC focus.
*The SEC’s new climate roles are squarely within their authority and is supported historically
*Currently companies inflate their environmental progress
*Full and complete impacts of a business are essential for a free market
*Financial transparency on climate change is essential for a market solution – not compelled speech
*Firms have to show us what they are doing and they will be a little more conscious about it. Their behavior will improve,
*Mandatory disclosures won’t cover all emissions
*Public companies would have to report but not private companies!
*There is no statutory basis for the SEC to impose this new climate disclosure
*There is no explanation for how these disclosures would be consistently and fairly required
*Existing rules already require this type of reporting
*This new rule is outside the scope and authority of the FEC
The new rule targets fossil fuel industries unfairly
The legal challenges that will block implementation – Harvard Law School on Corporate Governance May 2022