Digitizing Climate Reporting Compliance

Abstract

The Security and Exchange Commission (SEC) has issued long‐awaited rules for public comment that would require registrants to include certain climate‐related disclosures in their registration statements and periodic reports to the SEC. The requirement would be for all companies under the federal securities law offering or selling securities unless otherwise exempted by the SEC. Consistent with the Securities Act of 1933 (“Act”) the rule fits within the two basic objectives of the Act: (1) to require that investors receive financial and other significant information concerning securities being offered for public sale, and (2) to prohibit deceit, misrepresentations, and other fraud in the sale of securities. Given the growing appetite from elected officials for future climate‐related regulation and costs associated with decarbonization, and mitigation and disaster recovery from severe weather events, the proposed rules are timely.