SEC votes to issue interpretive release re climate change disclosure

By Cydney Posner

The SEC today voted (three to two) to publish an interpretive release to provide guidance to public companies regarding the SEC's current disclosure requirements that relate to climate change.  The release discusses the existing requirements that mandate disclosure of climate change issues if material, including direct and indirect effects of current and pending legislation, regulation and treaties, as well as vulnerability to material effects of climate change.  Commissioners Casey and Paredes voted against the release.  Commissioner Casey thought that the release was unnecessary and provided a curious signal to the community in light of more pressing regulatory issues. Commissioner Paredes objected to the requirements to disclose reputational exposure and vulnerability to climate events as speculative.  Both argued that the science was "unsettled" and that the release inappropriately advanced an agenda.  The staff argued in rebuttal that the release was carefully crafted to be neutral.