SEC's Climate Disclosure Rule Faces Legal Challenges and Controversies

The Securities and Exchange Commission's (SEC) new climate disclosure rule, aimed at promoting transparency on how companies address climate risks, faces significant court challenges and controversies. The rule, approved in a 3-2 vote, requires large public companies to disclose both short and long-term physical climate risks, but exempts about 60% of domestic public companies, sparking concerns. The removal of a requirement to disclose board members' climate expertise and the contentious 'Scope 3' emissions reporting have stirred environmental advocacy and potential legal action. Additionally, Republican-led states have filed a petition challenging the rule, citing an excessive reporting burden. Amidst opposition and lawsuits, the rule's influence on corporate reporting and environmental awareness remains uncertain.