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SEC Stays Its Climate Disclosure Requirements

April 5, 2024 Download PDF

On April 4, 2024, the SEC issued an order staying its recently adopted climate-related disclosure requirements pending the outcome of litigation in the U.S. Court of Appeals for the Eighth Circuit.  The rules, which were adopted on March 6, are the subject of numerous legal challenges, initially leading to a stay issued by the U.S. Court of Appeals for the Fifth Circuit, but all of which have now been consolidated into one litigation in the Eighth Circuit.   In its order, the SEC noted that “the Commission is not departing from its view that the [climate-related disclosure requirements] are consistent with applicable law and within the Commission’s long-standing authority to require the disclosure of information important to investors in making investment and voting decisions” and that it would continue to vigorously defend the new rules in court.  However, the SEC decided to voluntarily stay the rules to facilitate the orderly resolution of these challenges and to avoid companies being subject to the rules during the pendency of the litigation. 

Despite these developments, we remind companies that there are numerous other climate-related disclosure requirements that are coming online, including those imposed by California and the European Union.  While the California requirements are also being challenged, the EU requirements are expected to continue in force. 

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