May 28, 2022

Public companies must disclose their greenhouse gas emissions under new rules proposed by the US Securities and Exchange Commission. The move is part of the Biden administration’s campaign to identify climate risks and cut emissions by up to 52 percent by 2030. Three Democratic SEC Commissioners voted to approve the proposal, while Republican Commissioner Hester M. Pierce voted no.

“I’m happy to support today’s resolution because, if passed, it will provide investors with consistent, comparable and compelling information to guide their investment decisions, as well as provide consistent and clear reporting obligations to issuers.” This was stated by SEC Chairman Gary. Gensler

Under the new rule, companies must explain how climate risks will affect their operations and strategies. They must share their emissions, and large companies must have numbers verified by independent consultants. They must also disclose indirect emissions from suppliers and customers if they are “material” to their climate goals.

In addition, companies that have made public pledges to reduce their carbon footprint must indicate how they plan to achieve these goals. This includes the use of carbon offsets such as planting trees, which have been criticized as a poor alternative to actual emission reductions, according to a recent Greenpeace report.

The SEC already allows voluntary emissions guidelines, but new rules will make them mandatory. Many companies, such as Ford, already separate data on factory production emissions and vehicle fuel consumption. “However, there are many companies that will not do this if it is not necessary,” said Mary Shapiro, head of the operations group. Washington Post before the publication of the report.

After the proposed rule is posted on the SEC website, the public has 60 days to comment. The final rule is likely to be adopted in a few months and introduced in a few years. The decision could be challenged in court by corporate groups, as well as Republicans in states like West Virginia, as climate change won’t be a significant issue for investors in the near future.

However, experts warn that time is of the essence. The Intergovernmental Panel on Climate Change (IPCC) recently released a report that says many of the effects of global warming are “irreversible” and there is a short window of time to prevent the worst. UN Secretary-General António Guterres called it “a scathing indictment of failed climate leadership.”

Editor’s note: This article was originally published on Engadget.

Leave a Reply

Your email address will not be published.