The SEC recently published a sample comment letter on climate change disclosure. The goal is to make companies aware of what is coming down the pipeline in terms of disclosure for climate change.

Earlier in July, SEC Chair Gary Gensler asked agency staff to submit a mandatory climate risk disclosures proposal for review. These reports may be required in an expanded Form 10-K and describe a company’s direct and indirect carbon emissions, including those by suppliers and partners.

SEC disclosure rules may require companies to disclose current & potential future material impacts of climate change on the company’s business and financial condition and performance.

According to the SEC, “Information related to climate change-related risks and opportunities may be required in disclosures related to a company’s description of business, legal proceedings, risk factors, and management’s discussion and analysis of financial condition and results of operations.”

For now, the SEC is asking companies to provide information about climate change’s direct and indirect impact on their business. This includes the impact of regulations.

In the future, companies may need to report on greenhouse gas emissions, the financial effects of climate change, and progress towards climate-related goals.

Gensler said he wants investors to have access to “consistent, comparable, and decision-useful disclosures.”

The tools to combat climate change are here. Between technological innovation and carbon offsetting, it is possible to achieve net-zero emission goals.

The SEC is expected to release more information by the end of this year…