SEC Halts Climate Rule After Republican Attorneys General File Challenge

The Securities and Exchange Commission (SEC) halted its implementation of a climate rule that requires some companies to disclose greenhouse gas emissions.

According to a summary of the rule, businesses are to report “climate-related risks.”

Registrants were to “provide certain climate-related information in their registration statements and annual reports. The final rules will require information about a registrant’s climate-related risks that have materially impacted, or are reasonably likely to have a material impact on, its business strategy, results of operations, or financial condition. In addition, under the final rules, certain disclosures related to severe weather events and other natural conditions will be required in a registrant’s audited financial statements.”

The move follows 25 Republican attorneys generals filing a lawsuit against the rule. The states argued that the SEC attempted to implement the rule without congressional approval.

Iowa Attorney General Brenna Bird, who led the lawsuit, said in a statement, “Today’s victory shuts down the most outrageous climate mandate for businesses since Biden took office. The SEC’s job is to protect people from fraud. It has no business slapping companies with extremist climate mandates. We are making it clear that Biden has to follow the law like everyone else.”

“By halting this mandate, we are protecting business from costly red tape, securing our supply chain, and defending family farms. Next, we are going to make this win permanent!”

The lawsuit involved Iowa, Alabama, Alaska, Arkansas, Georgia, Idaho, Indiana, Kentucky, Louisiana, Mississippi, Missouri, Montana, Nebraska, New Hampshire, North Dakota, Ohio, Oklahoma, South Carolina, South Dakota, Tennessee, Texas, Utah, Virginia, West Virginia, and Wyoming.

“The Commission ordered ‘that the Final Rules are stayed pending completion of judicial review of the consolidated Eighth Circuit petitions,'” the SEC wrote to the Eighth Circuit.