Yesterday, The U.S. Securities and Exchange Commission (SEC), the agency empowered to oversee financial markets, announced a proposed rule change that would require publicly traded companies in the U.S. to disclose their greenhouse gas emissions and climate-related risks, while also indicating how these risks will impact their businesses and strategy in the future.
Smart Growth America (SGA) supports this rule change and recognizes the importance of tracking climate risk and the harmful pollution that causes climate change. With these proposed disclosures, investors and regulators alike will have a better window into the climate-altering damages caused by companies emissions and have access to much-needed information to both protect the environment and support economic growth. More comprehensive data on how climate risk could materially impact businesses and the economy will also be an important tool for policymakers anticipating both the physical and transition risks arising from climate change.
While the SEC’s rule proposal is an important step that will provide better data on climate risk, emission reductions, and targeted mitigation efforts, further action is urgently needed. The climate crisis is already causing damage across the U.S., with impacts felt disproportionately in historically marginalized communities. In addition to the SEC’s proposed rule, we need federal, state, and local policies targeting the land use, infrastructure, and transportation sectors that recognize climate risk and protect and support the most-impacted communities.
“Climate change is an equity issue—it’s undeniable that the most vulnerable members of society are impacted most by the severe weather effects of climate change,” said Calvin Gladney, President and CEO of Smart Growth America. “The SEC’s rule change represents important progress to track climate-altering emissions, and when combined with additional policies to prevent and prepare communities for future climate-related impacts, we will truly take a meaningful step to ensure access to healthy and resilient communities for all people.”
SGA believes that everyone should have access to a place that is healthy, prosperous, and resilient, and that vision is only possible with immediate action on climate. Through our research, including Driving Down Emissions and The Great Real Estate Reset, our team has laid out specific, actionable steps to reduce emissions, enhance preparedness, and ultimately create more equitable and vibrant communities. We look forward to continuing to support this rule change and to advocate for additional smart growth policies. These policies should both prepare and protect communities from the impacts of climate change, and recognize the likely fiscal impacts of climate change for local governments and community members as well as businesses.
If you’re interested in providing practitioner insight into SGA’s public comment on the new disclosure requirements, please reach out to us at [email protected].