Report: SEC Climate Disclosure Rule Spams Investors, Arms Climate Alarmists

The Competitive Enterprise Institute today released a report on the controversial Securities and Exchange Commission climate disclosure rule, examining its legal and economic drawbacks.

“The SEC should not be allowed to implement a rule that punishes companies for energy use and carbon emissions – a policy that Congress never authorized the Commission to impose,” said Stone Washington, CEI research fellow and author of the report.

The report walks through the ways that the SEC climate rule exceeds the agency’s statutory authority, compels speech, undermines the SEC’s existing financial disclosure-based framework, and increases costs and work-hour burdens for publicly traded companies.

The SEC’s own calculations estimate the average firm will pay an extra $327,000 for the first year of the rule’s implementation and $183,000 each year following. The final costs for firms following mandated disclosures come in at an estimated $628 million.

“These costly, burdensome energy-related disclosures will spam investors with reams of useless information while arming political activists with information ripe for targeting American businesses,” Washington explained.

Lawsuits challenging the rule have been consolidated before the Eighth Circuit Court of Appeals, and the SEC voluntarily stayed the effective date pending judicial review. Companies must start reporting climate data to the SEC in January 2025. Regardless of the initial outcome, it will likely be appealed to the U.S. Supreme Court.

View the report, Climate Disclosure Spam: Why investors will suffer if SEC’s new rule survives, by Stone Allen Washington