SEC Final Rule Makes Agency Climate Change Taskmaster Over Markets, Public Companies

WASHINGTON, D.C. – U.S. Senator Cindy Hyde-Smith (R-Miss.) on Wednesday cosponsored a Congressional Review Act (CRA) resolution to overturn the Securities and Exchange Commission’s (SEC) radical climate disclosure rule that exceeds the agency’s authority and would lead to mountains of burdensome paperwork for companies and higher costs for consumers.

Hyde-Smith, who serves on the Senate Energy and Natural Resources Committee, is an original cosponsor of the bipartisan S.J.Res.72 to strike the SEC climate disclosure rule, which requires publicly traded companies to disclose their greenhouse gas emissions data.  It was introduced by Banking Committee Ranking Member Tim Scott (R-S.C.).

“We recognize that the Biden administration is in a regulatory frenzy, but the radical SEC climate disclosure rule is so out of bounds that it must be struck down,” Hyde-Smith said.  “The SEC is a securities regulator with a mandate to protect investors, facilitate capital formation, and maintain markets.  It has absolutely no statutory authority to address political or social issues, much less serve as a climate change taskmaster.”

“The SEC’s final climate disclosure rule threatens economic opportunity across the country, and it must be overturned.  Over and over again, SEC Chair Gensler has disregarded the real-world impacts of his aggressive regulatory agenda in his dogged pursuit of left-wing political priorities.  This rule is no exception.  The SEC’s mission is to regulate our capital markets and ensure all Americans can safely share in their economic success – not to force a partisan climate agenda on American businesses.  This rule is federal overreach at its worst, and the SEC should stay in its lane,” Scott said.

The 886-page final rule, titled “The Enhancement and Standardization of Climate-Related Disclosures for Investors,” requires any public company to include onerous climate-related disclosures in their annual public reports, including direct greenhouse gas emissions and indirect greenhouse gas emissions from energy sources.  It also requires companies to disclose the potential impacts of nonfinancial risks, like severe weather or other natural disasters.

Under Chair Gary Gensler, the SEC has pursued an aggressive regulatory agendas with the agency currently on track to propose and finalize over 60 rules.  Like the climate disclosure rule, many are being pushed with limited public comment periods and inadequate cost-benefit analyses.

Supporters of S.J.Res.72 believe the rule threatens the U.S. capital markets’ position as the global gold standard by overwhelming businesses with compliance costs, litigation, and fines as they are forced to adopt burdensome assessment mechanisms to determine what climate-related information needs to be reported or not.

Additional original cosponsors of the measure include U.S. Senators Mike Crapo (R-Idaho), Mike Rounds (R-S.D.), Thom Tillis (R-N.C.), John Kennedy (R-La.), Bill Hagerty (R-Tenn.), Cynthia Lummis (R-Wyo.), J.D. Vance (R-Ohio), Katie Britt (R-Ala.), Kevin Cramer (R-N.D.), Steve Daines (R-Mont.), Mitch McConnell (R-Ky.), Chuck Grassley (R-Iowa), John Cornyn (R-Texas), John Thune (R-S.D.), John Barrasso (R-Wyo.), Jim Risch (R-Idaho), Joe Manchin (D-W.Va.), Jerry Moran (R-Kan.), John Boozman (R-Ark.), John Hoeven (R-N.D.), Marco Rubio (R-Fla.), Ron Johnson (R-Wis.), Deb Fischer (R-Neb.), Shelley Moore Capito (R-W.Va.), Bill Cassidy (R-La.), James Lankford (R-Okla.), Tom Cotton (R-Ark.), Dan Sullivan (R-Alaska), Mike Braun (R-Ind.), Rick Scott (R-Fla.), Tommy Tuberville (R-Ala.), Ted Budd (R-N.C.), and Pete Ricketts (R-Neb.).