Climate Impact Analysis Rollback Would Leave Investors in the Dark

In its latest action to undo climate action, the newly pro-polluter Securities and Exchange Commission (SEC) has proposed repealing a 2024 rule requiring some publicly traded companies to report their greenhouse gas emissions and the risks they face from global warming. 

The reports are intended to ensure that investors know the severity of risks faced by the companies related to climate change, including potential liability for the costs of emission reductions. However, the SEC now asserts that the rules “exceed the scope of the agency’s statutory authority” and that they “impose substantial costs on public companies and their shareholders that are not justified by the informational benefits they may provide to some investors.” 

Concerned Organizations Push Back

Environmental groups dispute the SEC’s new assertions. “The SEC’s mission is to protect investors and the public by ensuring they have access to material information,” said Kathy Fallon, director of land systems at the nonprofit Clean Air Task Force. “While imperfect, the rule was an important step toward giving investors consistent information about financially material climate risks, including the use of carbon offsets.”

“The SEC is shirking its responsibility to protect investors. Climate risk is financial risk. Investors need to know the potential impacts to their portfolio from extreme weather or other climate risks, as the SEC concluded in 2024 based on a mountain of evidence,” said Tom Zimpleman, a senior attorney with the Natural Resources Defense Council (NRDC). “This reversal would mean investors are left in the dark about the material risks companies face from climate change.”