The acting chair of the U.S. Securities and Exchange Commission (SEC) on Wednesday said the market regulator will review public companies’ climate-risk disclosures and begin to modernize climate guidance that is now more than a decade old.
The agency’s staff will review the extent to which public companies address topics related to climate-change matters and assess companies’ compliance with their disclosure requirements, acting chair Allison Herren Lee said in a statement.
The SEC will use the review to update guidance on climate-change matters from 2010, taking into account developments of the past decade, Ms. Lee said.
Scientists’ warnings about risks from climate change have grown over the past 10 years, but companies’ methodologies for calculating those risks are inadequate and inconsistent, advocates for more disclosure such as the Center for American Progress have said.
The board of the International Organization of Securities Commissions separately on Wednesday said it sees an urgent need for globally consistent and reliable sustainability disclosures.
Ms. Lee herself has criticized the SEC’s lack of clear guidance on environmental, social and governance – known as ESG – disclosures, saying in August that many market participants use the rubric as a “significant driver in decision-making.”
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