SEC publishes climate-related disclosure requirement proposals

The US Securities and Exchange Commission (SEC) has published a proposed rule ‘the Enhancement and Standardization of Climate-Related Disclosures for Investors’.

If finalised, the rules would require registrants to include certain climate-related disclosures in their registration statements and periodic reports, including information about climate-related risks that are reasonably likely to have a material impact on their business, results of operations, or financial condition, and certain climate-related financial statement metrics in a note to their audited financial statements. The compliance dates vary, however, large accelerated filers would be required to comply for their fiscal years ended 2023, with smaller filers following in 2024 and 2025.

Many of the disclosures in the proposed rules are similar to those in the Task Force on Climate-Related Financial Disclosures (TCFD), which form the basis of the climate ED, which will be issued by the ISSB by the end of March 2022.

The full proposed rules may be accessed here. A summary of the proposed rules may be accessed here.