WASHINGTON, DC – On March 6, the U.S. Securities and Exchange Commission (SEC) finalized the first requirements for large corporations to “provide certain climate-related information in their registration statements and annual reports.”
The final rule limits the disclosure requirement to Scope 1 and Scope 2 emissions, direct emissions from the company’s operations and those associated with its energy consumption. The rule does not include a previously proposed requirement to disclose Scope 3 emissions, which would have required companies to disclose the emissions that come from throughout their supply chains.
Reporting requirements for Scope 3 emissions faced widespread opposition from stakeholders, including USA Rice and others in the agricultural sector who argued the disclosure requirements would be steeply burdensome and expensive, potentially to the point of putting small- and mid-size farmers out of business.
SEC Commissioner Gary Gensler has addressed the agriculture industry’s response to the proposed Scope 3 emissions reporting, saying, “We’ve got a lot of comments from the agricultural community – the, you know, rural America – that said, ‘Look we’re a farmer or rancher that you know we’re not a public company we shouldn’t get caught up in this. And I agree with that.’" Gensler said the final rule is “an important step forward for investors to get more comparable, consistent, and decision-useful information.”
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here to read the full text of the final rule.