May 14, 2021 | less than a minute read

SEC Chairman Re-Affirms Focus on Climate Change Disclosures

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Jacob H. Hupart

Member

Get in touch

Jacob H. Hupart

Member

Yesterday, SEC Chairman Gensler re-affirmed the focus of the SEC on regulations concerning climate change risk disclosures. Specifically, he identified this issue as one of his "top priorities."

This statement echoes the recent focus of the SEC under the Biden Administration on using financial disclosures concerning climate risk as part of its broader efforts to enact its regulatory agenda concerning climate change. (This pattern of regulation is also seen in the UK and various EU jurisdictions.)

Companies should expect significant regulatory proposals concerning climate change disclosures to emanate from the SEC over the next few months.

New U.S. Securities and Exchange Commission Chairman Gary Gensler said Thursday that rulemaking around climate risk and human capital disclosures will be "an early focus" of his tenure in light of investors' interest in the areas. Gensler's remarks opened the annual Conference on Financial Market Regulation, hosted jointly by the SEC's Division of Economic and Risk Analysis, Lehigh University and the University of Maryland, where the recently sworn-in chairman talked about his plans to "freshen up our rules of the road for modern markets." Investors increasingly want information from issuers about climate risk and "one of the most critical components of companies, their workforce," Gensler said, adding that he looks forward to reviewing his staff's recommendations on potential proposals for rules addressing those issues. "This is one of my top priorities and will be an early focus during my tenure at the SEC," Gensler said. "I believe investor demand should guide our thinking on this work."