Washington, United States | AFP
The United States abandoned plans Thursday to require publicly-listed companies to disclose data on their greenhouse gas emissions and exposure to climate risks, with the financial regulator calling the rules “unnecessarily intrusive”.
The Security and Exchange Commission‘s rules were adopted in March 2024, in the final year of Democrat Joe Biden‘s presidency, the first time the companies were required to report and address climate risks.
But under the Republican Trump administration the SEC has ended its defense of the disclosure regime.
“The goal of today’s Commission action … is to cease the Commission’s involvement in the defense of the costly and unnecessarily intrusive climate change disclosure rules,” SEC Acting Chairman Mark Uyeda said in a statement.
Under the regulation, which was to be phased in over the 2025 fiscal year, companies would have been required to report Scope 1 and Scope 2 emissions — which cover direct emissions and those for energy purchased to run operations — when those emissions are “material”, or significant.
Listed companies also would have had to report on climate-related risks and their real or potential effects on corporate strategy, business models and forecasts.
“States and private parties have challenged the rules,” and the commission had paused the regulation pending completion of the litigation, the SEC said Thursday.
“Following today’s Commission vote, SEC staff sent a letter to the court stating that the Commission withdraws its defense of the rules.”
Shortly after the text was adopted in March 2024, prosecutors in nine states took the case to a federal appeals court.
At the time, West Virginia’s attorney general Patrick Morrisey — today the state’s governor — described the Biden-era policy as “a backdoor move to undermine the energy industry.”
Morrisey had denounced SEC efforts to force companies to act definitively on climate change when “there are people that devote their life to this topic and you can’t find much agreement.”
A Cornell University study from 2021 showed that 99.9 percent of published research had concluded that climate change was primarily caused by human activity.
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