SEC chief says new California law could 'change baseline' for coming SEC climate rule
Adds detail
Sept 27 (Reuters) -A pending law in California that would require companies to make climate-related disclosures could affect how federal regulators consider the costs of their own forthcoming climate regulations, Wall Street's top regulator told lawmakers on Wednesday.
U.S. Securities and Exchange Commission (SEC) Chair Gary Gensler's testimony during a house oversight hearing highlighted the potential for the California law to support the agency's efforts to regulate corporate climate disclosures, which face stiff opposition from industrial lobbies.
"If it were signed into law, as I understand it, that would require companies a certain size to report their climate risk," Gensler said in testimony before the House of Representatives.
"That may change the baseline. If those companies were reporting to California, then it would be in essence less costly because they'd already be producing that information."
California Governor Gavin Newsom said earlier this month that he intended to sign legislation requiring large companies to disclose their carbon footprints.
The bill tackles one of the thorniest issues in climate regulation by asking companies to measure and report a complex category of indirect emissions linked to their supply chains and end-users, known as Scope 3.
The SEC last year proposed long-awaited regulations that would likewise require publicly traded companies to notify investors of the companies' emissions, as well as climate-related spending and risks, amid a wider global effort to address fossil fuel-driven climate change by requiring companies to disclose their emissions and risks.
Among a barrage of objections, industry has complained the SEC has underestimated the cost of complying with the proposed rule.
Companies and industry groups have complained that the proposed rule would require them to develop new systems for accounting for emissions, not only by themselves but by their suppliers, driving up the costs of complying with the law for industries as varied as agriculture, transportation and banking.
Reporting by Douglas Gillison; Editing by Aurora Ellis
Latest News
Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.
All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.
Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.
