SEC Expected To Drop Scope 3 GHG Emissions Disclosure Requirements From Final Climate Rule

Since the SEC proposed its climate disclosure rule in March 2022, the rule has been subject to significant public criticism and comment--particularly from business groups and conservative legislators who have questioned the scope of the proposed rule, as well as the authority of the SEC to promulgate it. Much of this criticism has focused on the proposal that a company disclose Scope 3 greenhouse gas emissions, which requires that a company report not only its own direct emissions (and indirect emissions from power consumption), but the emissions from both upstream and downstream sources in its value chain (e.g., for a car manufacturer, the emissions generated by the mines that produce the metal and all of the emissions from the cars produced). Indeed, this aspect of the proposed rule even received considerable pushback from politicians and corporations otherwise in support of the SEC's climate disclosure rule, for a variety of reasons, including the difficulties