Today, the U.S. Impact Investing Alliance applauds an important milestone for corporate transparency on climate factors. The Securities and Exchange Commission (SEC) released a long-awaited final rule requiring U.S.-listed companies to disclose information related to climate-related risks and their material impacts.
“Climate risk is financial risk, and investors need access to clear, comparable data on these factors from companies to inform their decisions,” said Fran Seegull, President of the Alliance. “Though there is room to strengthen certain provisions, we still believe the SEC’s final rule marks progress in advancing fair and efficient markets. Today signals a win for investors, U.S. economic competitiveness and market stability.”
We appreciate the SEC’s leadership and careful consideration of stakeholder feedback on this important issue. That said, we are disappointed to see certain provisions from the proposal removed or weakened in the final rule. In particular, we are concerned that the final rule removes Scope 3 greenhouse gas emissions disclosure requirements entirely and weakens requirements related to Scope 1 and Scope 2 greenhouse gas emissions disclosures.
The final rule comes amid a broader global regulatory movement to standardize how companies report on these factors, including efforts by the IFRS Foundation, which sets the accounting standards for over 140 jurisdictions globally. Therefore, today’s rule and future SEC action toward enhanced corporate transparency on sustainability factors are necessary for maintaining U.S. economic competitiveness. The Alliance has long supported the SEC’s corporate transparency and disclosure agenda, and we remain committed to building on the progress made to date, including ensuring maximum alignment across global regulators and standard setters.
The Alliance will continue to analyze the final rule and the implications for investors in the coming days and weeks. In the meantime, we express support for the progress made by the SEC and believe it will lay a foundation from which future regulations can build.