SEC Proposes Enhanced and Standardized Climate-Related Disclosure Rules – JD Supra

Securities and Exchange Commission  proposed enhanced and standardized climate-related disclosure rules to require disclosure of climate-related information in registration statements, annual reports, and the audited financial statements filed with the SEC, by both domestic registrants and foreign private issuers.

Under the proposed rules, the following climate-related disclosures would be required in a separately captioned “Climate-Related Disclosure” section, except for the information required in the notes to the financial statements.

The proposed rules also provide for disclosure of disaggregated climate-related metrics in a separate note to the financial statements.

Large accelerated filers may need to have processes in place to comply with the proposed rules starting as early as January 2023, while other filers are given more time before their compliance date.

Given the substantial effort that would be needed to comply with these disclosure requirements if adopted, companies can prepare for these proposed climate-related disclosure requirements by reviewing climate-related oversight responsibilities, data collection and review, climate-risk analyses, strategic plans, and climate-related goals and actions.

The proposed rules do not define these time periods.

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