Washington: The U.S. Securities and Exchange Commission has proposed scrapping its 2024 climate disclosure rule, a major rollback that would remove federal requirements for many public companies to report climate-related risks and, in some cases, greenhouse gas emissions.
The proposal, announced on May 29, 2026, seeks to rescind the climate-related disclosure rules “in their entirety.” The SEC said the rules exceed the agency’s statutory authority and are not consistent with a company-specific, materiality-based approach to investor disclosure.
The original rule, adopted in March 2024, would have required public companies to disclose certain climate-related financial risks in annual reports and registration statements. In some cases, companies would also have had to report greenhouse gas emissions and the financial effects of severe weather events. The rule was paused in April 2024 while legal challenges moved through the courts.
SEC Chair Paul Atkins has argued that the regulation imposed heavy costs on companies and went beyond the SEC’s core securities-law mandate. The commission’s current position is that companies should disclose climate information only when it is materially relevant to investors, rather than under a broad climate-specific rule.
Supporters of the rollback say the original rule was too costly, too complex and legally vulnerable. Business groups and Republican-led states had challenged the rule, arguing that the SEC was trying to regulate climate policy through securities law.
Investor and environmental groups strongly disagree. They say climate risks can directly affect company finances, supply chains, insurance costs, assets and long-term business planning. Without a uniform disclosure rule, they warn, investors may receive incomplete or inconsistent information about how companies are exposed to climate change.
The proposal now enters a 60-day public comment period after publication in the Federal Register. After that, the SEC can vote on whether to finalize the rescission.
Even if the federal rule is killed, climate reporting will not disappear completely. Companies with operations in places such as California or the European Union may still face separate climate and sustainability disclosure requirements. That means large multinational companies could still have to report emissions and climate risks under other legal systems.
The move marks another sharp shift in U.S. climate and financial regulation. For companies, it could reduce federal compliance burdens. For investors and climate advocates, it could mean less standardized information about a risk they argue is already reshaping markets.
For now, the rule is not dead yet. But the SEC has made its direction clear: it wants to pull back from mandatory climate disclosure at the federal level.
