SEC may Mandate Climate Change Disclosure

If you are a part of or own a publicly listed company in the US, you are probably aware of all the regulatory requirements of the SEC. Your organization may even have a team dedicated to handling reports, or you may have trusted a partner to help you successfully submit documents to the SEC. Either way, we’re sure that any possible news that is likely to change the equilibrium of your current process is of interest and importance to you.

By 2023, it may be mandatory for your firm to disclose risks related to climate change in your regulatory filings. The SEC is considering a new proposal for the same.

SEC Chairman Gary Gensler has asked his team members to consider adding these disclosures to financial data in Form 10k that details your company’s annual report.

This move has been taken to ensure that the 10Ks are accurate and comprehensive so that SEC enforcement attorneys can spot disclosure failures with ease.

Although there is a hand full of firms who currently disclose climate-related data, they are most often inconclusive and difficult to compare with the standard. The SEC aims at uniformity in the data submitted for a consistent and thorough investigative practice.

How does this affect you?

  1. This business exposure may open up possibilities of litigation and lawsuits.
  2. You may need to generate/calculate new data to be included in your annual report.
  3. Your current reporting process – be it software or a service provider will need to be prepared and update new disclosure requirements on time.

At DataTracks, we have the people, process, data, and technology to help you navigate through new regulatory requirements with ease. Our way of working is centered around collaboration, validations, and a superior level of automation.

Our flagship software Rainbow, dedicated to reporting for the SEC, is designed to include risk-based controls that can eliminate errors from submissions. This extends to any changes in mandates as they are easily integrated and automatically aligned with your data. If the SEC introduces a new climate change regulation, it is likely to take not more than few weeks to automatically reflect on our system and align with your data set.

In-built validations add an additional layer of accuracy and leave no room for rejections. What is more? Our software is hosted on a secure cloud-based platform in the US. This expands your horizons in collaborative working!

Learn more about DataTracks’ solutions for SEC regulatory compliance and reporting. Schedule a discussion with our in-house expert in SEC reporting. We manage over 300 clients for their SEC compliance requirements.