US SEC Chair to Propose Corporate Climate Change Disclosure Rules by Year-End

Gary Gensler, Chairman of the U.S. Securities and Exchange Commission (SEC)
Photo by Reuters Yonhap News

[Asia Economy Reporter Park Byung-hee] Gary Gensler, chairman of the U.S. Securities and Exchange Commission (SEC), announced that he will propose regulations requiring companies to disclose climate change-related risk information by the end of this year.

According to Bloomberg News on the 28th (local time), Chairman Gensler stated in a speech on 'responsible investing' that he has instructed a review on whether climate change-related risks should be included in disclosures by companies important to investors. He further announced that he will present a proposal by the end of the year requiring companies to disclose qualitative and quantitative information related to climate change to investors.

Chairman Gensler also said he will pursue measures to mandate the disclosure of climate change risk information. While some companies currently voluntarily disclose climate change-related risks, he pointed out that "there is a lack of consistency and comparability." He added, "Investors want the ability to compare companies (regarding climate change risks) with each other," emphasizing that "mandatory disclosure is what helps investors achieve consistency and comparability."

Climate change-related risks refer to the potential direct losses caused by abnormal temperatures resulting from climate change, as well as risks that may arise during the transition from fossil fuel use to eco-friendly energy.

The SEC currently raises the need for companies to disclose climate change-related risks through guidelines, but it does not provide specific guidelines on which items to disclose or how to disclose them.

This content was produced with the assistance of AI translation services.