SEC Proposes Repeal of Corporate Climate Disclosure Rule

The Securities and Exchange Commission on Friday proposed repealing a rule finalized in 2024 that would have required some public companies to disclose greenhouse gas emissions and climate-related financial risks. The commission said the rule exceeds its statutory authority and imposes costs on companies and shareholders that are not justified by the information provided to investors.

Background on the 2024 Rule The rule was approved in March 2024 by a 3-2 party-line vote, with Democratic commissioners in favor and Republican commissioners opposed. It drew more than 24,000 public comments during a two-year drafting process. The rule never took effect.

Lawsuits filed in 2024 by the U.S. Chamber of Commerce and 25 Republican state attorneys general led the commission to pause its legal defense.

Atkins said the repeal would avoid dictating corporate behavior and ensure rules are imposed only when expected benefits justify costs and burdens.

“We need to stick to our knitting. Let the Environmental Protection Agency do their job and we stick to our job." — Paul Atkins, SEC Chairman, in an interview with Fox Business. Atkins described the prior approach as placing substantial costs on public companies and shareholders that were not justified by informational benefits.”

Environmental groups said the repeal would leave investors without consistent information needed to assess climate-related financial risks. Kathy Fallon, director of land systems at the Clean Air Task Force, said the rule was an important step toward giving investors information about financially material climate risks, including the use of carbon offsets.

The proposal opens a 60-day public comment period after publication in the Federal Register. The commission currently has three Republican members and no Democratic members. Repeal of the rule is one of multiple environmental policy changes during President Donald Trump's second term.

The Environmental Protection Agency has eliminated major climate programs and canceled billions of dollars in prior environmental justice grants. California maintains its own corporate climate disclosure requirements, with first filings due August 10.

Forty-one other countries have similar rules or proposals covering about 60 percent of the global economy.