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March 01, 2010 at 02:00 AM
The political debate over climate change continues following the December global meeting in Copenhagen. It certainly didn’t help matters that in mid-February Washington D.C. was hit with major snowstorms of historic proportions, leading some conservative writers (e.g. “Tough Sledding for Global Warming Gang,” by Paul Mulshine, The Star Ledger, February 9, 2010) to point to that as proof that global warming and climate change are myths.
The Securities and Exchange Commission has wisely chosen to stay out of that fight, but has decided to provide public companies with interpretive guidance on existing SEC disclosure requirements as they apply to business or legal developments relating to the issue of climate change.
The Commission’s interpretive release offers guidance on a number of existing rules that may require a company to disclose the impact that business or legal developments related to climate change may have on its business. The relevant rules cover a company’s risk factors, business description, legal proceedings, and management discussion and analysis.
Specifically, the SEC’s interpretative guidance highlights the following areas as examples of where climate change may trigger disclosure requirements:
