On June 16, 2022, the Committee submitted a comment letter to the Securities and Exchange Commission (the “SEC”) regarding its proposed rule to require public companies to provide specified climate-related information in their registration statements and annual reports (the “Proposed Rule”).

The Committee agrees with the Proposed Rule that it is important to “provide consistent, comparable, and reliable—and therefore decision-useful—information to investors to enable them to make informed judgments about the impact of climate-related risks on current and potential investments.” Currently, issuers voluntarily disclose material climate risks as contemplated by the SEC’s 2010 interpretive guidance on climate change disclosure. In principle, the Committee supports the enhancement of mandatory public disclosure of climate-related risks; however, we are concerned that the Proposed Rule would fail to achieve this goal in a number of respects.

Part I of this letter provides a description of key aspects of the Proposed Rule, and Part II is an analysis of the policy and legal basis for the Proposed Rule, setting forth recommendations that would better align the Proposed Rule with the intended goal of enhancing disclosure of climate-related risks by public companies. Part II also includes a review of the Proposed Rule’s cost-benefit analysis.

The full letter is available here.