SEC Rule Will Help Protect Wall Street, Main Street Alike from Climate Financial Risk

“The Securities and Exchange Commission just voted in favor of a climate risk disclosure rule that will help protect our country’s economy and people’s financial security, from Wall Street to Main Street, from the destruction caused by climate change.

“Climate disasters have been a serious and growing threat to our economy for quite a while now, and investors have been waiting for better information to help them navigate that threat. For many years, the SEC has required publicly traded companies to disclose a wide range of financial risks that they face. This new rule will require them to include vital information about climate risk in that long-established tradition. It will allow investors to make wiser, better-informed decisions – which will in turn protect not just businesses but families, retirees, anyone who has a 401(k) or a pension, and everyone who has any savings in the stock market.

“A chorus of businesses and investors have already voiced their support for mandatory climate risk disclosure. Many businesses already disclose climate risk data through voluntary frameworks, and the SEC’s standards will bring improved rigor and consistency. The SEC has a responsibility under the law to protect investors and markets from evolving risks, like climate financial risk. Their vote today is an essential and overdue step toward meeting that responsibility.

“Now the SEC should continue building on the strong foundation it set today, so we can make sure investors have the reliable, transparent information they need as threats from climate change continue to grow. Across our economy, businesses, consumers, and investors will all benefit from strong safeguards.”

            - Fred Krupp, president of Environmental Defense Fund