SEC adopts rule making companies disclose climate risks
SEC adopts rule making companies disclose climate risks
In a 3-2 vote Wednesday, the Securities and Exchange Commission passed new rules requiring public companies to disclose climate-related risks to investors. These rules are meant to standardize reporting requirements on things like emissions and exposure to climate change-related disasters.
In the meeting before the vote, SEC Commissioner Caroline Crenshaw got Shakespearean: “A risk by any other name of such import to public company investors would be worthy of commission rule-making.”
Her point? Despite the pushback, this is about investor risk and not a climate change debate. Cornell’s John Tobin agrees.
“Many companies have interpreted already the recommendations of the SEC to at least hint at the need for some climate disclosure. Because yeah, it’s a material risk,” he said.
The new rules are softer than the ones proposed; companies won’t have to disclose emissions related to their supply chains or what happens once their products are sold to a consumer.
Consider the steel in cars. “There have been massive amounts of emissions in the process of going from iron ore in the ground to sheets of steel,” Tobin said.
So big car companies who buy that steel won’t have to disclose emissions from the iron extraction.
There’s a lot happening in the world. Through it all, Marketplace is here for you.
You rely on Marketplace to break down the world’s events and tell you how it affects you in a fact-based, approachable way. We rely on your financial support to keep making that possible.
Your donation today powers the independent journalism that you rely on. For just $5/month, you can help sustain Marketplace so we can keep reporting on the things that matter to you.
