The controversial ruling from the U.S. Securities and Exchange Commission (SEC) that demands the public disclosure of corporations’ direct and indirect greenhouse gas emissions is eliciting more challenges in court, both from corporate entities and states administered by the GOP. These opponents voice strong protests arguing that the SEC’s authority limits to financial nuances and not environmental issues. The National Law Journal details the ongoing developments in this legal battle.
Republican leaders have vociferously criticized this mandate. Rep. Bill Huizenga, R-Michigan and the chair of the House Financial Services Subcommittee on Oversight and Investigations, asserts the SEC has no explicit backing from Congress to pass its climate rule. During a hearing in Lebanon, Tennessee, he stated, “The commission finalized the climate rule despite no clear congressional authorization.”
Similarly, Rep. Andy Ogles pointed out the significant role that legislatures play in creating law and taking the resulting impact into account. His argument appears to suggest that the SEC might be construed as overstepping its boundaries. Citing constitutional functions, he opined, “Our Constitution empowers only Congress to make the law and importantly to take responsibility for the consequences.”
The story increasingly seems to shape as a discourse about authority and jurisdiction as much as it is about environmental governance and corporate transparency. As the disagreements and court cases pile up, the upcoming rulings could potentially reshape the responsibility of financial regulators in deals with environmental matters.