Proposed SEC Climate Disclosures: An Overview of the Proposed Rule and What Companies Need to Do Now
On March 21, 2022, the SEC issued a Proposing Release setting out sweeping new requirements for climate change disclosures. If finalized as proposed, these climate disclosure rules would require dramatic changes to corporate climate disclosures. These changes include extensive qualitative disclosures on climate risk in annual reporting to the SEC and the inclusion of climate risks in audited financials. Vinson & Elkins’ new whitepaper provides an in-depth review of the Proposing Release to help companies assess how the proposed rule may impact them.
We urge you to carefully consider commenting on the proposed rule before the May 20, 2022 deadline.
Developing the systems and controls to comply with the proposal will be a significant task for many companies, and it must be conducted against the backdrop of the SEC’s other existing climate change initiatives, including its examination priorities. The V&E team’s experience indicates that the SEC’s current commenting and enforcement practices are being shaped by many of the ideas in the Proposing Release. As a result, we encourage you to assess your company’s current ability to comply with the proposed requirements and consult with your internal team and external advisors to evaluate any gaps in your current reporting structure.
The V&E team is available to provide more in-depth education about the Proposing Release, the SEC’s current climate initiatives, and steps to prepare to comment and assess future compliance.
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This information is provided by Vinson & Elkins LLP for educational and informational purposes only and is not intended, nor should it be construed, as legal advice.