The Big Picture

Woke politicians in Washington are now looking to politicize the Securities and Exchange Commission (SEC) by forcing companies to disclose environmental, social, and governance (ESG) information to shareholders and the SEC. CLICK HERE TO TAKE ACTION!

ESG metrics include:

• Diversity among company leadership.
• Approach to climate change.
• Political contributions by board members and employees.
• Receptiveness to social change.

This government overreach represents a dangerous politicization of the SEC that places left-wing values ahead of the most important things a company should be focused on–maximizing profit and getting the highest rate of return for its investors.

A more than 500-page proposal, this regulation would require publicly-traded companies to disclose their impact on “climate change” to investors.

This is yet another in a long line of Biden administration policies that put America last–not first. When President Biden took office in 2021, America enjoyed energy independence because of the policies put forward by President Trump. But no longer. Biden canceled the Keystone XL Pipeline, destroying thousands of well-paying American jobs.

If adopted, this policy would force companies to spend money on disclosing speculative impacts on climate rather than on innovation and job creation. It would also discourage companies from going public.

Scroll for more details:

The Details

On March 21, 2022, the SEC proposed rules for climate change disclosure requirements for both U.S. public companies and foreign private​ issuers. These include…

• Climate-related risks and their actual or likely material impacts on the registrant’s business, strategy, and outlook;
• The registrant’s governance of climate-related risks and relevant risk management processes;
• The registrant’s greenhouse gas (“GHG”) emissions;
• Certain climate-related financial statement metrics and related disclosures in a note to its audited financial statements; and
• Information about climate-related targets and goals and transition plans, if any.

FreedomWorks bill of the month for May 2022 was H.R. 7355, the Stop Excessive Climate Reporting Act that stops the SEC from implementing this ridiculous proposal.

Why it Matters

This proposal is part of the Biden SEC’s crusade to implement the Left’s climate plan, stalled in Congress. This complicated legislation-through-regulation scheme will saddle companies with substantial new costs and enable the woke ESG crowd to bully companies–all the while enriching the trial bar, who’ll find new ways to sue productive companies; and big accounting firms, who’ll reap revenue from helping companies comply with these reporting requirements.

If companies wish to ingratiate themselves with investors who prioritize ESG metrics and want to disclose the information publicly, that is the company’s prerogative. An unsettling prospect is a massive unfunded government mandate pushing companies to broadcast internal ESG policies.

The SEC is currently accepting public comment on the proposal until June 17, 2022. We have named this regulation as our Regulation of the Month for May 2022. Please comment and tell the SEC why you oppose this proposal!