A potentially forthcoming climate reporting requirement from the U.S. Securities and Exchange Commission (SEC) has legal experts worried about a looming litigation risk for companies that don't have a robust team in place for tracking emissions data.
The SEC announced and opened a public comment period for its proposed climate disclosure rule in March 2022. The rule aims to standardize the climate-reporting information required from companies across the board, and is expected to go into effect this April for large public companies and in 2025 for smaller companies.
The proposal requires companies to disclose information on "Scope 1" direct emissions (greenhouse gases) and "Scope 2" indirect emissions (purchased energy), as well as upstream and downstream ("Scope 3") emissions for some companies. Scope 3 emissions disclosures are the most contentious requirement of the proposal because they require some companies to scrutinize global supply chains and the indirect impact of their products or services.
Complete your profile to continue reading and get FREE access to Treasury & Risk, part of your ALM digital membership.
Your access to unlimited Treasury & Risk content isn’t changing.
Once you are an ALM digital member, you’ll receive:
- Thought leadership on regulatory changes, economic trends, corporate success stories, and tactical solutions for treasurers, CFOs, risk managers, controllers, and other finance professionals
- Informative weekly newsletter featuring news, analysis, real-world case studies, and other critical content
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical coverage of the employee benefits and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
Already have an account? Sign In Now
*May exclude premium content© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
