The U.S. Securities and Exchange Commission (SEC) has formally proposed rescinding the corporate climate disclosure rules introduced during the Biden administration. Adopted in 2024, the rules required public companies to disclose climate-related risks, mitigation strategies, financial impacts from severe weather events, and, in certain cases, greenhouse gas emissions.
The move marks a significant policy shift under the Trump administration, which has consistently opposed the rules. After unsuccessful attempts to have the regulations overturned through litigation, the SEC has now initiated a formal rulemaking process to withdraw them.
According to the SEC, the climate disclosure requirements exceed the agency’s statutory authority and are inconsistent with its objective of maintaining a materiality-focused approach to securities regulation. The agency also argued that the rules impose substantial compliance costs on companies and shareholders, potentially discouraging capital formation and public listings.
The proposal is now subject to the standard notice-and-comment process, including a 60-day public consultation period, before any final decision is made. The rescission is expected to face legal challenges, with environmental organizations already pledging to oppose the rollback, arguing that climate-related disclosures provide investors with material information needed for informed decision-making.
