In February 2021, then-Acting SEC Chair, Allison Herren Lee, released a statement that directed the SEC’s Division of Corporation Finance to enhance its focus on climate-related disclosures in public company filings; this statement was based on existing disclosure guidance released in 2010. Lee’s statement was followed by inclusion of the topic in the SEC’s 2021 examination priorities, and the announcement of a new enforcement taskforce to focus on climate and ESG issues.
In March 2021, the SEC requested public input on climate-related disclosures to help evaluate current rules. The comment period closed in June 2021, with SEC Chair Gary Gensler reporting that of the 550 unique comment letters received, 75% supported mandatory climate disclosure rules.
In September 2021, the SEC staff released a sample letter indicating extensive questioning of the quality of public companies’ climate disclosures. Comment letters were sent to certain registrants, with comments largely based on the sample letter. The SEC staff has sent follow-up letters, which included requests for support for materiality assessments. To date, the related correspondence with nearly 30 registrants (totaling around 160 comments) has been made public.
These activities culminated in the SEC issuing its proposed climate reporting rules on March 21, 2022
Download KPMG’s full report for more details, including applicability and possible disclosure compliance dates.