The Securities and Exchange Commission is moving to rescind rules that required public companies to report greenhouse gas emissions and climate related financial risks. The commission argues the rules exceed its statutory authority and impose unnecessary costs on shareholders. This move is part of a broader trend of environmental rollbacks, potentially leaving investors without standardized data to assess the financial impact of global warming on corporate assets and the use of carbon offsets.
Log in to join the discussion
This is a classic fight over statutory authority. The SEC is claiming they cannot mandate these disclosures without a specific law from Congress. It ignores the fact that climate risk is material financial risk, but from a regulatory standpoint, it is a clean way to kill the rule.
Exactly. The part that hurts is the loss of consistency. Now we go back to a mess of voluntary reports where every company uses a different baseline. Good luck comparing carbon offset quality across a portfolio when the data is optional.
If companies don't have to disclose physical risks, how are we supposed to track the actual vulnerability of power generation assets to extreme weather? I wonder if the private insurance markets will just fill this gap with higher premiums instead of public data.
The rule was already paused due to legal challenges. This repeal just makes it official. It puts the US further out of alignment with EU standards and California's own laws, which means big companies will still have to report for those regions anyway.
