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SEC climate disclosure rule delayed until fall, former commissioner says

The business community, corporate lawyers and policymakers have been anxiously waiting for the SEC to issue its much-debated final climate risk disclosure rule by the end of April.

But a former SEC commissioner, speaking at an April 27 webinar hosted by the carbon accounting firm Watershed, said he learned the rule will be delayed until the fall. The SEC initially suggested the rule would be published in December 2022, but then pushed that date back to April 2023.

The SEC did not immediately respond to a request seeking to confirm the latest delay.

The SEC received thousands of comments on its proposed disclosure requirements during an extended comment period. The agency is wise in giving itself more time to make the rule the "best possible," Robert Jackson, a law professor at New York University and former SEC commissioner, told the webinar.

"I've just understood over the last few weeks that it looks like the rule is going to be pushed back a little further than many had thought, including myself," Jackson said. "It [now] looks more like the fall of this year."

Given the new time frame, financial statements and disclosures under the rule would not be due until 2024, Jackson said.

The proposed SEC rule, unveiled in March 2022, would require publicly traded companies to disclose their greenhouse gas emissions and any climate-related risks to their operations. Investors had asked the agency to standardize such disclosures, which many companies already provide in some fashion.

SEC Chairman Gary Gensler, testifying before the US House Financial Services Committee on April 18, said some 50,000 investors commented on the proposed rule, almost all in favor.

The forthcoming rulemaking has nonetheless been controversial since the SEC announced it. Some Republican lawmakers and red state officials have alleged government overreach and threatened litigation, while some business owners have expressed concerns over a lack of resources and the potential costs of estimating and reporting greenhouse gas emissions.

At the April 18 hearing, Gensler pushed back against Rep. Roger Williams (R-Texas) when the lawmaker questioned the rule's legality.

"Investors today are making decisions based on climate risks," Gensler said. "So it's about trying to bring some consistency to that. But we are not a climate regulator."

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