The House Financial Services Committee has scheduled a hearing on the Securities and Exchange Commission’s (SEC) recent rule change that requires public firms to disclose climate impact. The new ESG-type rules have been controversial at best, with some lambasting the Commission as becoming the Securities and Environment Commission as the agency goes beyond its mandate of efficient markets, investor protection, and capital formation.
The hearing, which is entitled Beyond Scope: How the SEC’s Climate Rule Threatens American Markets, was announced by the committee chairman, Patrick McHenry.
Witnesses and the Hearing memo have yet to be distributed.
You may anticipate that some of the discussion will be about the Commission’s overreach and the excessive cost ladled upon both public and, inevitably, private firms as they move to comply with the opaque rules. In the end, investors and customers will pay.
Some observers have predicted a new legion of consultants who will greenwash firms, providing data that aims to prove a firm’s green credibility.
Also, most investors are interested in the return on investment when purchasing a security in a firm. While some may be interested in environmentally focused firms, funds have emerged to serve this audience, which is probably a minority within the greater investing ecosystem.
Lawsuits are already in the works, challenging the rule.
The hearing is scheduled for April 10, 2024, at 10 AM ET and will be livestreamed on the Committee website.
