Climate change presents grave risk across the U.S. economy, including to corporations, their investors, the markets in which they operate, and the American public at large. The Securities and Exchange Commission (SEC) recently requested public input on climate change disclosures, posing several questions related to the development of new disclosure regulations and the enforcement of existing regulations.
We worked with several partners to submit comments to the SEC, providing 15 major recommendations. Among other measures, we recommend that the SEC:
- Establish mandatory climate risk disclosure requirements that produce comparable, specific, and decision-useful information for investors
- Move quickly to establish these climate risk disclosure requirements
- Maintain that climate risk disclosure and carbon markets are complementary policies, not substitutes
- Solicit stakeholder input on standards but not give industry participants the final say
- Use industry-specific standards to help ensure that investors receive sufficiently specific and decision-useful information
- Dedicate additional resources to enforcement and subject certain climate risk disclosures to auditing
Policy Integrity is a founding member of the newly formed Initiative on Climate Risk and Resilience Law, and we worked collaboratively with our ICRRL partners on these comments.