Earlier this month, Better Markets filed a comment letter in response to an SEC request for public input on climate change-related disclosures. Better Markets applauds the SEC for beginning the process of engaging on this critical issue. 

Climate change will have a drastic impact on every aspect of our economy and promises to disrupt the operations of countless businesses. More frequent and less predictable weather events will cause billions in damages, while the process of decarbonization will devalue assets.  In order to make sound and informed choices in the face of these urgent challenges, investors must have access to accurate information about companies’ operations and the risks they face. A climate change disclosure regime established by the SEC is essential so that investors can allocate their capital efficiently, in accordance with their values, and with an eye toward motivating the private sector to address climate change more effectively. 

Better Markets also joined more than 30 other prominent public interest groups in crafting and submitting an additional comment letter on this issue.

Why it matters? Without robust and standardized disclosures, it will be impossible for investors to assess these risks and take them into account as they choose where to invest their money. The SEC must acknowledge the obvious materiality of climate risks and implement a uniform disclosure regime as soon as possible.

What we said. We’re optimistic, as the SEC’s request clearly signals the intention of the agency to move forward with new climate-related disclosure requirements.  However, addressing climate risk disclosures should be the beginning, not the end, of a broader SEC initiative to ensure that investors are provided with meaningful, accurate, and usable disclosures on all ESG issues—those that relate not only to the environment but also to social justice and corporate governance. How companies address all ESG issues affects their bottom line, and this information accordingly would be material to a profit-seeking investor.

Bottom line.  We urge the agency to create robust mandatory climate-related disclosures that will allow investors and firms to come to terms with the many risks presented by our rapidly changing climate. To achieve these goals, the disclosures must be accurate, meaningful, comprehensive, comparable, and effective at fully informing investors.

Read more in our press release.