SEC to Propose Rules Concerning Mandatory Climate Change Disclosures on March 21

According to media reports, the SEC has announced that it will "propose rules mandating disclosure from publicly traded companies about climate change and associated risks" on March 21st. 

This is a highly-anticipated development; the SEC has been expected to propose such rules for several months, and these regulations were thought to be a centerpiece of the climate agenda of the Biden Administration.  Once the proposed rules are available for review, the impact of such regulations on corporate America can better be evaluated.

Nonetheless, the very fact that the SEC will propose such rules concerning mandatory climate disclosures is itself highly significant.  The SEC is taking action to advance a climate regulatory agenda through the financial markets that has been stymied elsewhere in the administrative state.  Further, the SEC is now taking steps to bring the United States into parity with other advanced economies, many of which--particularly in Europe--are also using financial disclosures to advance regulations designed to address the issue of global climate change.

We should also expect, however, that these new rules will be subject to legal challenge from the moment of announcement.  Additionally, whether these proposed rules are ultimately implemented will likely depend on the political fortunes of the Biden Administration.  The announcement on March 21st will simply be the first step in a long and complicated process.