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SEC Requests Input on Climate Disclosures

March 31, 2021

On March 15, the Securities and Exchange Commission (SEC) released a notice for public input on its current recommendations for disclosing climate risks and how it could change or supplement that process in the future.  The Commission currently relies on its 2010 guidance to help entities understand how to identify and report on climate risks that could impact investors.  Now, the SEC faces considerable pressure to revisit and expand the guidance to include more on material risks and environmental, social, and governance (ESG) factors.  The SEC is asking for feedback on 15 topics associated with the regulation of climate disclosures---including how the rules should address private companies’ climate disclosures.

AGC is aware that some publicly held construction firms currently disclose climate risk and would appreciate hearing from members on that process, as well as on members’ concerns with the possibility of new reporting measures for private construction firms.  The questions are summarized below, please refer to the notice for public input for the complete list of questions.  If you have insights that you would like to share with AGC, please contact Leah Pilconis at leah.pilconis@agc.org by April 30, 2021.

  1. How can the Commission improve the process to facilitate more consistent and beneficial information?
  2. What information on climate risks can be quantified; and how is that information used, evaluated, and disclosed?
  3. What are the advantages and disadvantages of industry-led disclosure standards?
  4. What are the advantages and disadvantages of industry-specific standards; and how should they be developed?
  5. What are the advantages and disadvantages of rules that incorporate existing frameworks—e.g., third-party standard developers?
  6. How should the Commission update any disclosure requirements over time?
  7. What is the best approach for requiring climate-related disclosures—e.g., incorporated into existing rules?
  8. How, if at all, should registrants disclose their internal governance and oversight of climate-related issues?
  9. What are the advantages and disadvantages of developing a single set of global standards applicable to companies around the world? If multiple standards, how should they be aligned?
  10. How should disclosures be enforced or assessed?
  11. What measures should the Commission consider to ensure the reliability of climate-related disclosures?
  12. What are the advantages and disadvantages of a “comply or explain” framework?
  13. How should the Commission craft rules that elicit meaningful discussion of the registrants views on its climate-related risks and opportunities—e.g., requiring analysis?
  14. What climate-related information is available with respect to private companies, and how should the Commission’s rules address private companies’ climate disclosures?
  15. How should the Commission include disclosures related to environmental, social, and governance, or ESG, matters?

For more information, please contact Leah Pilconis at leah.pilconis@agc.org.

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