New Legislation Is a Critical Step to Advance Climate Risk Disclosure

BOSTON, September 17, 2018 /3BL Media/ - The nonprofit sustainability organization Ceres applauds Sen. Elizabeth Warren’s, D-Mass, efforts to advance legislation that directs the U.S. Securities and Exchange Commission to issue rules requiring companies to disclose critical information about their exposure to risks posed by climate change. 

The legislation, known as the Climate Risk Disclosure Act, introduced today, builds off existing investor and advocacy efforts to advance climate risk disclosure, ensuring that companies are more transparent in how they are addressing these risks.

Ceres CEO and President Mindy Lubber issued the following statement:  

Climate change — from rising sea levels and extreme storms to the rapid transition to new, low-carbon technologies — can pose significant material financial risks to companies across all sectors of the economy. Ceres commends Sen. Warren’s efforts to scale up action on climate change, pragmatically addressing climate-related financial risks, and ensuring a smooth transition to a low-carbon economy.

The Climate Risk Disclosure Act will allow the market — via institutional investors and others — to better assess these risks, spurring both public and private sector actors to address climate change while promoting financial stability across the U.S. economy. Investors need this decision-useful information to manage the growing climate-related financial risks in their portfolios. 

This legislation supports the work that Ceres and investors worldwide are engaged in with companies to accelerate the low-carbon future. In 2010, Ceres and a diverse group of investors successfully persuaded the U.S. Securities and Exchange Commission to issue the first-ever disclosure guidance for corporate reporting on climate change risks. Ceres has long pushed the SEC to improve reporting standards on a broader range of material and financial sustainability risks. It is critical that the SEC acknowledges the importance of disclosing these risks to investors. 

Investors have long recognized the threats and opportunities posed by a warming planet and the need for a low-carbon transition. However, corporate reporting on climate risk is still minimal and does not meet the needs of investors — and because the market is lacking this information, we could be dramatically undervaluing the financial impacts on the economy.

Ceres is a sustainability nonprofit organization working with the most influential investors and companies to build leadership and drive solutions throughout the economy. For more information, visit www.ceres.org and follow @CeresNews.