Following requests from the US Securities and Exchange Commission (SEC), at least ten businesses, including General Dynamics, Halliburton and EOG Resources, have incorporated climate change risks into their regulatory disclosures.
The SEC is anticipated to complete a new rule compelling businesses to disclose additional details regarding their vulnerabilities to global warming in early 2023. Audits of specific emissions data would also be necessary.
Since the SEC proposed the rule in March 2022, a wide range of opponents have stood up in opposition. Companies have cautioned that compliance with climate risk disclosures will incur enormous new costs. Attorneys General from Republican states have threatened legal action.
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The regulation also presents the Biden administration with a challenging political issue. Concerns have been voiced about the disclosure rules in relation to emissions from a company’s suppliers or customers by Democratic senator Jon Tester of Montana, who is up for reelection in 2024 and is expected to have one of the most challenging campaigns in the nation.
The SEC has been covertly stress-testing corporations’ present disclosures of climate risk while the agency is finalizing this rule.
Several corporations received letters from the agency beginning in 2021 requesting further details about their climate risks. Some businesses have stated that their disclosures are appropriate, while others have stated that they would add more details.
New climate risk statements from ten firms were discovered by The Financial Times. According to legal experts, the SEC may use the statements as evidence in court.
Story was adapted from Financial Times.
