Multiple US Senators and House Representatives joined recently to issue an Amicus Brief challenging the Securities and Exchange Commission’s attempt to establish climate rules in regard to reporting firms. The Investor Choice Advocates Network (ICAN), a non-profit that advocates on behalf of investors and entrepreneurs, was also party to the statement.
The SEC, as part of its ESG initiative pursued under the leadership of Chairman Gary Gensler, has sought to expand its authority beyond securities and efficient markets to pursue highly political goals. One of the most contested issuers is climate disclosure, with some insiders lambasting the agency as the Securities and Environment Commission. While the rules may stretch far beyond its authority, they were approved by the Democrat-controlled Commission only to be challenged in the courts.
“The Amicus Brief states the “SEC’s Climate Rule lacks clear Congressional authorization. The SEC, as a securities regulator, is not empowered to impose sweeping climate-related regulations on publicly-traded companies. Congress has demonstrated historical reluctance to pass broad climate legislation, particularly legislation that would dramatically impact federal securities law disclosure requirements. The SEC’s overreach into climate regulation does not respect the separation of powers and runs afoul of the major questions doctrine, warranting the rule’s invalidation.”
The Amicus seeks to vacate the Climate Rule created by the SEC. A CRA [Congressional Review Act] resolution to overturn the rule is also being pursued.
The members who believe the Climate Rules should be eliminated stated that the “SEC has pursued one of the most aggressive regulatory agendas in the agency’s history – with the agency on track to propose and finalize over 60 rules with limited public comment periods and inadequate cost-benefit analyses.”
The document may be viewed here.