We remain adamantly opposed to the proposed SEC Climate Disclosure mandate since the stated role of the SEC is to protect investors, maintain fair, orderly, and efficient markets, and facilitate capital formation – not for a group of unelected bureaucrats to regulate the emissions of businesses they do not understand.
Unfortunately, the proposed SEC Climate Disclosure mandate's inevitable passing is trivial since several recently introduced regulatory requirements demand similar disclosures.
Regardless of what we, or the industry, think, tracking and disclosing non-financial ESG-related data is already baked into virtually all existing global regulatory frameworks.
The regulatory momentum compelling ESG disclosure is not slowing down, implying the time to prepare for ESG-related data assurance is now.
Commercial relationships, financial partnerships, and the data aggregation process have evolved from a voluntary binary exercise (i.e., do you or do you not have the data) and is now a mandatory three-step process:
- Does your team quantitatively track the material ESG data points that help better understand a competitive driver of long-term value?
- What degree of confidence do you have in that specific data point?
- Do you have the supporting documentation to validate the data point’s assigned confidence?
It is incorrect and dangerous to assume that the regulatory attempts to punish the fossil fuel space will wane - the groups committed to wiping out our industry are well-organized, funded, and connected.
The only way to counter the variety of bad policies and retake the narrative is to consistently convey quantitative trends, progress, and objective messaging into the generalist arena.
The five key objectives of this paper are to portray the following:
- Introduction- the ultimate passing of the proposed SEC rule is inconsequential at this point
- Summarizing the top five takeaways of the proposed SEC Climate Disclosure rule
- Outlining the top ten reasons we remain opposed to the proposed SEC rule
- Highlighting the seven other regulatory developments management teams must prepare for
- Showcasing the importance of conveying a quantitative story
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