What the SEC Climate Ruling Means for Companies

On March 6, 2024, the SEC approved new climate disclosure rules requiring most public companies to report climate-related risks and greenhouse gas emissions, including Scope 1 and Scope 2 emissions. The rule will impact approximately 2,800 US companies and 540 foreign organizations, with phased implementation beginning in 2025. While Scope 3 emissions were excluded from the final SEC rule, California's SB 253 and 261 will still require comprehensive emissions reporting for many businesses. Companies should prepare for increasing demands from purchasers for greenhouse gas metrics and consider implementing sustainability tracking systems to maintain competitive advantage.