US SEC pauses climate disclosure mandates for pending judicial review
![US SEC pauses climate disclosure mandates for pending judicial review](https://sustainabilityeconomicsnews.com/wp-content/uploads/2024/04/Depositphotos_216615448_S.webp)
Amid political criticism, the US Securities and Exchange Commission (SEC) has postponed implementing new climate-related disclosure requirements, citing pending judicial review.
The SEC’s groundbreaking regulation, aimed at enhancing transparency regarding companies’ climate-related risks for investors, faced legal challenges with multiple lawsuits filed.
The agency has exercised its discretion, halting the final rules until the Eighth Circuit U.S. Court of Appeals completes its review.
Also read: US appeals court temporarily halts SEC climate disclosure rules
Republican-led states, energy industry companies, and business groups argue that the regulations constitute environmental oversight, thus exceeding the SEC’s legal authority.
Conversely, environmental organizations such as the Sierra Club and Natural Resources Defense Council contend that the regulations are insufficient. They assert that an earlier, stricter draft was watered down.
Initially proposed in March 2022, the draft garnered many comment letters. The final version, unveiled two years later, will, in part, shape the legacy of SEC Chair Gary Gensler.
The SEC statement said the agency would continue “vigorously defending” the rules, which it said were consistent with applicable law and within its authority.
It noted “procedural complexities” and said a stay would allow “the orderly judicial resolution of those challenges and allow the court of appeals to focus on deciding the merits.”
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