SEC Fails Investors by Declining to Require Disclosure of Greenhouse Gas Emissions

The Securities and Exchange Commission today voted to finalize its rule for the Enhancement and Standardization of Climate-Related Disclosures for Investors. The Commission cut key provisions from the proposal, including a requirement to disclose Scope 3 emissions that would have given investors important insight into how companies are adapting to the climate crisis and clean energy transition. In response, David Arkush, director of Public Citizen’s climate program, issued the following statement:

“By cutting Scope 3 disclosures from the rule, the SEC has fallen far short on a core mission—providing investors with the information they need to make investment decisions.

“Ninety-seven percent of investor comments on the proposal favored comprehensive reporting of greenhouse gas emissions. Rather than heed investor demand, the SEC caved to special interests and was cowed by litigation risk. This decision illustrates the main peril of the Supreme Court’s current anti-regulatory bent—that agencies will self-censor and decline to execute their role properly.

The final rule retains useful and positive elements, and we will work to build on them. But as the clean energy transition hastens and other jurisdictions move forward to provide investors the information they want and need, it is deeply disappointing for the SEC to sideline itself on key issues, at least temporarily, instead of showing the leadership we need.”