Lawmaker Introduces Bill to Stop SEC's ESG Plan

Rep. French Hill, R-Ark., has introduced a bill to stop the Securities and Exchange Commission from finalizing its ESG proposal, entitled “The Enhancement and Standardization of Climate-Related Disclosures for Investors.”

French’s bill states that the SEC “may not” finalize or “implement or enforce such a finalized rule or any substantially similar rule to the plan,” which would require SEC registrants to provide certain climate-related information in their registration statements and annual reports.

The SEC released the plan in May and the comment period ended June 17.

Rep. Blaine Luetkemeyer, R-Mo., ranking member of the House Financial Services Subcommittee on Consumer Protection and Financial Institutions, told the SEC in a July 20 comment letter along with other lawmakers to rescind the rule.

“As the U.S. economy struggles to recover, unleashing a devastating and an unrealistic climate disclosure regime that goes well beyond the publicly traded companies, impacting nearly every small business, is irresponsible. Small firms simply cannot afford the additional burdens of the proposed rule,” Luetkemeyer and other lawmakers told the SEC.

Democrats on the House Financial Services Committee threw their support behind the bill, stating in another comment letter that the SEC plan “will support greater consistency for investors and companies working to navigate regulatory systems in international markets by better aligning U.S. reporting with other countries that already require these types of disclosures.”

The SEC has also proposed an ESG rule for investment advisors: “Enhanced Disclosures by Certain Investment Advisers and Investment Companies about Environmental, Social, and Governance Investment Practices.”

The comment period on that proposal expires Aug. 16.

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