After two years of waiting, the SEC finally came out with its new climate disclosure rules. As expected, it was met with a mix of celebration, disappointment, criticism, and lawsuits. The suits came from those who felt the rules went too far and from those who felt they don’t go far enough.

Disclosure rules are critical to ensuring companies are taking climate change seriously. They ensure investors can consider a company’s climate risks as well as their progress in cutting emissions.

Beyond the SEC, Europe and California’s rules are also influencing corporate action in profound ways.

To understand what’s been happening and what’s likely to happen next, I caught up with Steven Rothstein. Steven is the Managing Director of the Ceres Accelerator for Sustainable Capital Markets. He’s been working for years to align financial markets to climate goals and is a well respected expert on this topic. We talked about the history of disclosures, why they matter, the recent SEC rule change, the reaction it sparked, what’s coming next, and much more. I always learn a lot from talking to Steven and I’m sure you will too. Enjoy.

In today’s episode, we cover:

[03:07] Stephen's role at Ceres accelerator
[03:25] The Accelerator’s work & capital market change
[05:02] History of early climate reporting
[06:58] Disclosure requirements in Europe and CSRD
[10:29] California law coverage of private companies
[11:06] Ceres' role in California climate laws
[13:23] Why SEC rule took two years
[15:07] The importance of Scope 3 SEC inclusion
[16:29] SEC rule may evolve over time
[18:00] Legal challenges to rules and regulations
[20:47] Continuing climate preparations
[23:15] Balancing reporting and climate action
[27:19] The importance of interim targets
[29:56] Election impact on climate progress
[31:45] Developing transition plans and data analysis
[35:13] Actions listeners can take

Resources Mentioned

Ceres Accelerator for Sustainable Capital Markets

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Episode 155: Laura-Mary Carter (Blood Red Shoes)