The Securities and Exchange Commission (SEC) has recently approved new rules regarding the disclosure of climate risks and greenhouse gas emissions by public companies. This decision marks a significant step towards greater transparency and accountability in corporate reporting on environmental issues.
Under the new rules, corporations are now required to inform investors about their greenhouse gas emissions and business risks related to climate change. This move comes after years of debate and opposition, particularly from Republicans and various industries, including fossil fuel producers.
One significant change in the approved rules is that large companies are no longer obligated to disclose emissions along their entire “value chain.” Instead, only companies that deem their emissions as “material” to their bottom lines are required to report their direct emissions. This change is a departure from the original proposal, which would have applied to all publicly traded corporations.
Another notable aspect of the new rules is that thousands of smaller businesses are now exempt from reporting their emissions. This exemption is a departure from the initial proposal, which would have required all publicly traded corporations to disclose their emissions.
Overall, the approval of these rules represents a crucial development in the realm of corporate disclosure on climate-related issues. By requiring companies to be more transparent about their environmental impacts, investors and stakeholders can make more informed decisions about their investments and hold companies accountable for their contributions to climate change.
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