April 20, 2022
As a researcher doing research on the Carbon Emissions of companies and the role of corporate governance and internal carbon pricing as tools and incentives for the reduction of emissions, I am familiar with the reporting by corporations on their carbon emissions. Across years and across companies in their sustainability or corporate citizenship reports, the reporting on carbon emissions is not uniformly done, and very difficult to follow and interpret, making it difficult to compare different companies in the same industry and to analyze their trends.
Companies reporting to the CDP tend to have somewhat better reporting, but other companies often don't have any reporting on their carbon emissions or carbon risks. With the disclosures having no uniform format, it is also takes an arduous search often to find trends in Scope 1 and Scope 2 carbon emissions, and there is no uniform reporting format.
The proposed rules would help investors to evaluate the climate risk of companies and their progress in reducing carbon emissions over time.