Chair Castor, Rep. Casten & 129 Other House Democrats Urge SEC to Finalize Rule on Climate Risk Disclosure
WASHINGTON (June 17, 2022) – On Friday, Chair Kathy Castor and Rep. Sean Casten of the House Select Committee on the Climate Crisis led a letter - signed by a total of 131 House Democrats - urging the Securities and Exchange Commission (SEC) to finalize its rule on climate risk disclosure to better inform investors about how climate change may impact a company’s business, operations, or financial condition:
"As the impacts of climate change continue to drive increasingly severe economic disruption and loss, investors are intensifying their demands for information regarding the legal, technological, and market changes from these impacts and the global transition to a net-zero economy," the letter reads. "Investors need climate-related disclosures that are standardized to be comparable, specific, and decision-useful to enable meaningful evaluation of the risks associated with the physical impacts of a changing climate and the ongoing transition to a clean energy economy."
The letter calls on the SEC to finalize a rule that would require companies to disclose:
- Information about their corporate governance of climate-related risks and relevant risk management processes;
- How climate-related risks can affect the registrant’s strategy, business model, and outlook; and
- The impacts of climate-related events, such as severe weather, and transition activities on the registrant’s consolidated financial statements, as well as on the estimates and assumptions used in those statements.
The letter also calls for specific climate-related metrics to be required in a company’s disclosures, including:
- Physical risks and risk reduction targets;
- Scopes 1-3 greenhouse gas emissions and any clean energy and emissions reduction targets; and
- Performance against those targets.
"We applaud the Commission and staff for the thorough approach in seeking input, exploring the full range of options and methods, and designing a rule to respond to growing investor demand for climate-related risk information," the letter reads. "We urge the Commission to finalize the rule as quickly as possible."
The letter was signed by Representatives Kathy Castor, Sean Casten, Alma Adams, Pete Aguilar, Nanette Barragán, Karen Bass, Donald S. Beyer Jr., Earl Blumenauer, Lisa Blunt Rochester, Suzanne Bonamici, Carolyn Bourdeaux, Jamaal Bowman, Anthony Brown, Shontel Brown, Julia Brownley, Salud Carbajal, Tony Cárdenas, André Carson, Troy Carter, Matt Cartwright, Sheila Cherfilus-McCormick, Judy Chu, David Cicilline, Katherine Clark, Yvette Clarke, Emanuel Cleaver, Steve Cohen, Gerald Connolly, Joe Courtney, Jason Crow, Charlie Crist, Danny Davis, Peter DeFazio, Diana DeGette, Ted Deutch, Mark DeSaulnier, Debbie Dingell, Mike Doyle, Veronica Escobar, Anna Eshoo, Adriano Espaillat, Dwight Evans, Bill Foster, Lois Frankel, Jesús G. "Chuy" García, Jimmy Gomez, Al Green, Raúl Grijalva, Steven Horsford, Jared Huffman, Sheila Jackson Lee, Sara Jacobs, Pramila Jayapal, Eddie Bernice Johnson, Henry Johnson, Mondaire Jones, Marcy Kaptur, Robin Kelly, Ro Khanna, Andy Kim, Raja Krishnamoorthi, James Langevin, John Larson, Brenda Lawrence, Al Lawson, Barbara Lee, Andy Levin, Mike Levin, Ted Lieu, Zoe Lofgren, Alan Lowenthal, Stephen Lynch, Tom Malinowski, Carolyn Maloney, Sean Maloney, Doris Matsui, Betty McCollum, Donald A. McEachin, James McGovern, Jerry McNerney, Grace Meng, Gwen Moore, Grace Napolitano, Joe Neguse, Marie Newman, Eleanor Norton, Ilhan Omar, Frank Pallone, Jimmy Panetta, Donald Payne, Scott Peters, Chellie Pingree, Mark Pocan, Katie Porter, Ayanna Pressley, Mike Quigley, Jamie Raskin, Deborah Ross, Lucille Roybal-Allard, C. A. Dutch Ruppersberger, Bobby Rush, Linda Sánchez, John Sarbanes, Mary Gay Scanlon, Janice Schakowsky, Robert Scott, Brad Sherman, Adam Smith, Darren Soto, Jackie Speier, Melanie Stansbury, Haley Stevens, Thomas Suozzi, Eric Swalwell, Mark Takano, Bennie Thompson, Mike Thompson, Dina Titus, Rashida Tlaib, Paul Tonko, Ritchie Torres, Lori Trahan, David Trone, Lauren Underwood, Juan Vargas, Nydia Velázquez, Bonnie Watson Coleman, Peter Welch, Nikema Williams, Frederica Wilson, and John Yarmuth.
The full text of the letter is available here.