{"id":312418,"date":"2024-03-24T14:40:08","date_gmt":"2024-03-24T13:40:08","guid":{"rendered":"https:\/\/climatescience.press\/?p=312418"},"modified":"2024-03-24T14:40:11","modified_gmt":"2024-03-24T13:40:11","slug":"emissions-are-not-a-material-risk-to-investors-or-companies-secs-climate-disclosure-rule-is","status":"publish","type":"post","link":"https:\/\/climatescience.press\/?p=312418","title":{"rendered":"Emissions Are Not a Material Risk to Investors or Companies, SEC\u2019s Climate Disclosure Rule Is"},"content":{"rendered":"\n
\"\"<\/figure>\n\n\n\n

<\/p>\n\n\n\n

From Watts Up With That?<\/a><\/p>\n\n\n\n

By Justin Bis<\/a><\/p>\n\n\n\n

The Securities and Exchange Commission is at it again. Straying from its core mission of \u201cprotecting investors, maintaining fair, orderly, and efficient markets, and facilitating capital formation,\u201d the SEC is now taking the mantle of climate activist. Chairman Gary Gensler\u2019s signature policy, the Climate Disclosure Rule, was just approved in a partisan 3-2 vote. Companies will now have to disclose direct and indirect emissions that they produce to investors. This rule, in the guise of informing investors of material risks in companies, will overwhelm investors with information that is unrelated to actual risks to a company\u2019s performance.<\/p>\n\n\n\n

For example, how do the emissions coming from a company\u2019s truck make an investment in that company riskier to investors? In this example at least, the answer is it doesn\u2019t.<\/p>\n\n\n\n

But even if you could find an example, the SEC already requires companies to disclose material risks, and insurers \u2013 whose entire business depends on analyzing and assigning material risk \u2013 do not factor in emissions. <\/p>\n\n\n\n

So, what is the point of Climate Disclosure Rule? The SEC contends that the Rule is meant to inform investors on the climate risks of their investments. The trouble: investors don\u2019t seem to care about climate risks.  Letting the cat out of the bag, the SEC posted a study<\/a> on their website which seems to demystify their motives, stating \u201cinvestors only care about climate change risks when policymakers intervene, not about physical climate risks.\u201d The SEC seems to be looking for a problem to their solution. Nonetheless, the agency continues to claim that investors are clamoring for climate risk information. But, as SEC Commissioner Hester Peirce noted in her dissenting comments, this creates a \u201chodgepodge standard\u201d that could lead to the SEC creating disclosures for every type of social value. What\u2019s next, will the SEC create antiwar disclosures, religious disclosures, or political ideology disclosures?<\/p>\n\n\n\n

There is a point where over-disclosure is a threat to transparency, creating an obfuscation that hides real risks from investors. Spamming investors with non-material information will reduce the quality of the normal reporting process.  Furthermore, the costs of disclosing every direct or indirect emission will be a significant burden borne by investors and eventually passed on to the consumer in the form of higher prices. For small companies, the compliance cost alone will be another job killing barrier to competing. For companies thinking of going public, this will be just another reason not to. This rule betrays the core mission of the SEC by making investments less transparent, markets less efficient, and preventing capital formulation.<\/p>\n\n\n\n

The real reason the SEC is venturing into this murky terrain is that the current administration is beholden to the environmental social governance (ESG) movement, which seeks to starve disfavored industries and companies of capital. Climate disclosures are intended to shame U.S. businesses into divesting from such critical sectors as mining, logging, and power generation. Widespread adoption of the disclosures is essential for the creating an ESG economy that enriches the politically connected but leaves everyday Americans footing the bill with fewer jobs and higher prices. Unable to pass these unpopular policies through the ballot box or through the Congress, administrative agencies such as the SEC are the new battleground. The Rule is a big step in replacing the free market with an ESG-inspired state capitalism.<\/p>\n\n\n\n

The Rule\u2019s legality is highly questionable, which is why, despite being SEC Gensler\u2019s main objective since taking office, it\u2019s suffered delay after delay. After more than twenty-thousand public comments and intense public outcry, the SEC surrendered some important ground. Perhaps cowed by recent court decisions that require agencies to point to \u201cclear Congressional authorization\u201d for their authority, the SEC did a massive, last-minute rewrite, eliminating some major reporting requirements. But, even watered down, the final climate disclosure Rule clearly represents an overstep of the agency\u2019s authority. The rule is clearly vulnerable to courts striking it down or to Congress reclaiming its authority through the Congressional Review Act to restrict the SEC to its actual mission.<\/p>\n\n\n\n

My organization, the Financial Fairness Alliance, strives to uncover what the SEC and other U.S. regulators are up to. We believe that the public needs to be informed about what their government is doing because the government works for us, not the other way around. It is time for rogue agencies, like the SEC, to return to their core missions of protecting people and making our markets fair and transparent.<\/p>\n\n\n\n

Justin Bis is the Director of the Financial Fairness Alliance. He has held senior government roles, including at the White House and the U.S. Department of Energy, where he assisted with recruiting top-level governmental leaders responsible for regulating the U.S. financial and energy markets. <\/em><\/p>\n\n\n\n

This article was originally published by RealClearEnergy and made available via RealClearWire.<\/strong><\/p>\n\n\n\n

<\/p>\n","protected":false},"excerpt":{"rendered":"

The Securities and Exchange Commission is at it again. Straying from its core mission of \u201cprotecting investors, maintaining fair, orderly, and efficient markets, and facilitating capital formation,\u201d the SEC is now taking the mantle of climate activist. <\/p>\n","protected":false},"author":121246920,"featured_media":312420,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_coblocks_attr":"","_coblocks_dimensions":"","_coblocks_responsive_height":"","_coblocks_accordion_ie_support":"","_crdt_document":"","advanced_seo_description":"","jetpack_seo_html_title":"","jetpack_seo_noindex":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2},"jetpack_post_was_ever_published":false},"categories":[1],"tags":[691818056,691827817,691827815,691818229,691823591,691827816],"class_list":{"0":"post-312418","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","6":"hentry","7":"category-uncategorized","8":"tag-climate-change","9":"tag-climate-disclosure-rule","10":"tag-company","11":"tag-esg","12":"tag-investors","13":"tag-risks","15":"fallback-thumbnail"},"jetpack_publicize_connections":[],"jetpack_featured_media_url":"https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2024\/03\/088962a6c0b05dbac942235608bf59d8a8adfaa0d13fc8d9771f3bc277850.webp?fit=1200%2C630&ssl=1","jetpack_likes_enabled":true,"jetpack_sharing_enabled":true,"jetpack_shortlink":"https:\/\/wp.me\/paxLW1-1jh0","jetpack-related-posts":[{"id":205314,"url":"https:\/\/climatescience.press\/?p=205314","url_meta":{"origin":312418,"position":0},"title":"DISCLOSING THE REAL \u201cCLIMATE RISK\u201d: CASE STUDY: UK \u201cESG\u201d Billionaire Behind U.S. Climate Regulatory, Litigation Campaigns","author":"uwe.roland.gross","date":"21\/06\/2022","format":false,"excerpt":"From Government Accountability & Oversight WEBEDITOR GAO published research today revealing the breadth and depth of a campaign by \u201cESG\u201d investors \u00a0\u2014 and one investor in particular \u2014 costing hundreds of millions of dollars and instilling in investors the fear that their assets could become worthless, or nearly so, as\u2026","rel":"","context":"Similar post","block_context":{"text":"Similar post","link":""},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2022\/06\/image-80.png?fit=1024%2C512&ssl=1&resize=350%2C200","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2022\/06\/image-80.png?fit=1024%2C512&ssl=1&resize=350%2C200 1x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2022\/06\/image-80.png?fit=1024%2C512&ssl=1&resize=525%2C300 1.5x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2022\/06\/image-80.png?fit=1024%2C512&ssl=1&resize=700%2C400 2x"},"classes":[]},{"id":240070,"url":"https:\/\/climatescience.press\/?p=240070","url_meta":{"origin":312418,"position":1},"title":"\u201cESG Check in\u201d: More details on the Securities & Exchange Commission\u2019s Activist Role in the \u201cWhole of Government\u201d Push on ESG, \u201cClimate Risk Disclosure\u201d","author":"uwe.roland.gross","date":"16\/01\/2023","format":false,"excerpt":"The indispensable transparency-in-government group Energy Policy Advocates has provided GAO a review of record productions from FOIA litigation with the Securities & Exchange Commission, including specifically from calendars of Chairman Gary Gensler and then-Commissioner Allison Herren Lee.","rel":"","context":"Similar post","block_context":{"text":"Similar post","link":""},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2023\/01\/image-745.png?fit=1200%2C755&ssl=1&resize=350%2C200","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2023\/01\/image-745.png?fit=1200%2C755&ssl=1&resize=350%2C200 1x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2023\/01\/image-745.png?fit=1200%2C755&ssl=1&resize=525%2C300 1.5x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2023\/01\/image-745.png?fit=1200%2C755&ssl=1&resize=700%2C400 2x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2023\/01\/image-745.png?fit=1200%2C755&ssl=1&resize=1050%2C600 3x"},"classes":[]},{"id":337572,"url":"https:\/\/climatescience.press\/?p=337572","url_meta":{"origin":312418,"position":2},"title":"The SEC\u2019s Climate Disclosure Rule Is a Dark Cloud Over Energy Abundance","author":"uwe.roland.gross","date":"25\/07\/2024","format":false,"excerpt":"The Securities and Exchange Commission (SEC) climate disclosure rule posts real problems for public companies. The SEC\u2019s mission is to do facilitate capital formation and maintain market efficiency, but for the first time in its 90-year history, the SEC has injected political risk factors into its traditionally principles-based disclosure framework.","rel":"","context":"In \"Climate Disclosure Rule\"","block_context":{"text":"Climate Disclosure Rule","link":"https:\/\/climatescience.press\/?tag=climate-disclosure-rule"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2024\/07\/image-630.png?fit=1200%2C758&ssl=1&resize=350%2C200","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2024\/07\/image-630.png?fit=1200%2C758&ssl=1&resize=350%2C200 1x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2024\/07\/image-630.png?fit=1200%2C758&ssl=1&resize=525%2C300 1.5x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2024\/07\/image-630.png?fit=1200%2C758&ssl=1&resize=700%2C400 2x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2024\/07\/image-630.png?fit=1200%2C758&ssl=1&resize=1050%2C600 3x"},"classes":[]},{"id":229824,"url":"https:\/\/climatescience.press\/?p=229824","url_meta":{"origin":312418,"position":3},"title":"FTX\u2019s crypto ponzi scam was also a green scam","author":"uwe.roland.gross","date":"18\/11\/2022","format":false,"excerpt":"FTX worked hard on its green image, something its founder now admits was just a con","rel":"","context":"Similar post","block_context":{"text":"Similar post","link":""},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2022\/11\/02022-11-17t231929z_3_lynxmpeiag11c_rtroptp_3_fintech-crypto-ftx-congress.webp?fit=1200%2C676&ssl=1&resize=350%2C200","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2022\/11\/02022-11-17t231929z_3_lynxmpeiag11c_rtroptp_3_fintech-crypto-ftx-congress.webp?fit=1200%2C676&ssl=1&resize=350%2C200 1x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2022\/11\/02022-11-17t231929z_3_lynxmpeiag11c_rtroptp_3_fintech-crypto-ftx-congress.webp?fit=1200%2C676&ssl=1&resize=525%2C300 1.5x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2022\/11\/02022-11-17t231929z_3_lynxmpeiag11c_rtroptp_3_fintech-crypto-ftx-congress.webp?fit=1200%2C676&ssl=1&resize=700%2C400 2x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2022\/11\/02022-11-17t231929z_3_lynxmpeiag11c_rtroptp_3_fintech-crypto-ftx-congress.webp?fit=1200%2C676&ssl=1&resize=1050%2C600 3x"},"classes":[]},{"id":211260,"url":"https:\/\/climatescience.press\/?p=211260","url_meta":{"origin":312418,"position":4},"title":"Punish Companies Who Downplay Climate Risk!","author":"uwe.roland.gross","date":"31\/07\/2022","format":false,"excerpt":"By Paul Homewood LONDON, July 29 (Reuters) \u2013 Some of Britain\u2019s top listed companies could be downplaying risks from climate change on their bottom line and could face \"appropriate action\", regulators said on Friday. Trillions of dollars have flowed into stocks and bonds of companies which tout their environmental, social\u2026","rel":"","context":"Similar post","block_context":{"text":"Similar post","link":""},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2022\/07\/0image-122-1.png?fit=664%2C754&ssl=1&resize=350%2C200","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2022\/07\/0image-122-1.png?fit=664%2C754&ssl=1&resize=350%2C200 1x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2022\/07\/0image-122-1.png?fit=664%2C754&ssl=1&resize=525%2C300 1.5x"},"classes":[]},{"id":338172,"url":"https:\/\/climatescience.press\/?p=338172","url_meta":{"origin":312418,"position":5},"title":"Legal Challenges to the SEC\u2019s Climate-Related Disclosures Rule","author":"uwe.roland.gross","date":"01\/08\/2024","format":false,"excerpt":"\u201cAnd When Did You Last See Your Father?\u201d \u2013 William Frederick Yeames, 1878 The scene: Room 2128 Rayburn House Office Building at a hearing of the House Financial Services Committee on the SEC\u2019s climate-related disclosures rule, April 10, 2024.","rel":"","context":"In \"Climate change\"","block_context":{"text":"Climate change","link":"https:\/\/climatescience.press\/?tag=climate-change"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2024\/08\/0sec_seal.jpg?fit=1200%2C1200&ssl=1&resize=350%2C200","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2024\/08\/0sec_seal.jpg?fit=1200%2C1200&ssl=1&resize=350%2C200 1x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2024\/08\/0sec_seal.jpg?fit=1200%2C1200&ssl=1&resize=525%2C300 1.5x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2024\/08\/0sec_seal.jpg?fit=1200%2C1200&ssl=1&resize=700%2C400 2x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2024\/08\/0sec_seal.jpg?fit=1200%2C1200&ssl=1&resize=1050%2C600 3x"},"classes":[]}],"_links":{"self":[{"href":"https:\/\/climatescience.press\/index.php?rest_route=\/wp\/v2\/posts\/312418","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/climatescience.press\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/climatescience.press\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/climatescience.press\/index.php?rest_route=\/wp\/v2\/users\/121246920"}],"replies":[{"embeddable":true,"href":"https:\/\/climatescience.press\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=312418"}],"version-history":[{"count":2,"href":"https:\/\/climatescience.press\/index.php?rest_route=\/wp\/v2\/posts\/312418\/revisions"}],"predecessor-version":[{"id":312421,"href":"https:\/\/climatescience.press\/index.php?rest_route=\/wp\/v2\/posts\/312418\/revisions\/312421"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/climatescience.press\/index.php?rest_route=\/wp\/v2\/media\/312420"}],"wp:attachment":[{"href":"https:\/\/climatescience.press\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=312418"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/climatescience.press\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=312418"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/climatescience.press\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=312418"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}