Get Ready For New SEC Climate-Risk Disclosure Rules

The SEC will propose a demanding new set of climate-related disclosure requirements by the end of this year, according to Sonia Barros, partner at Sidley Austin and formerly with the SEC’s Division of Corporate Finance. She tells a Bloomberg reporter that companies can expect extensive requirements pertaining to emissions, not only those produced directly by the company (so-called Scope 1 emissions), but also the Scope 2 emissions that are associated with the purchase of electricity, steam, heat or cooling, and possibly even with regard to additional sources produced by supply chain partners and customers. Also likely, according to Barros, are requirements for more generalized disclosures regarding company strategy and management of climate-related risks.