April 24, 2022
I see the Enhancement and Standardization of Climate-Related Disclosures for Investors as a tool to provide much needed guidance for the behavior of companies and investors in the context of environmental disclosures.
I like the inclusion of specific disclosure responsibilities, financial metrics, economic analysis, a specific reporting framework, small business fairness inclusion, and of GHG protocol. I also like the inclusion of Paperwork Reduction, as I feel its a pleasant supplement to the proposal. This proposal does a great job of setting the scene for the practical need for standardization in this specific context.
Areas for improvement could be in the Financial Impact Metrics section, as its rather ambiguous. The statement that climate-related risks are defined in part as the actual or potential negative impacts of climate-related conditions (p.116) leads me to question how a reporting institution would accurately determine actual or potential negative impacts of real or supposed circumstances. An example of a situation that wouldnt have been conducive to this anticipatory method would be the 2020 Texas freeze, which resulted in devastation that was obviously not anticipated. How would this proposal aim to assure the accuracy of these estimations?
Quality of data is a significant challenge, and I feel that the proposal speaks to checking GHG disclosures specifically, providing the timeline requirements for third party reviews. I wonder if these timelines are flexible or took into consideration the administrative burden and timeline of these specific third-party impartial checkers. Id also like to know how it proposes to ensure that these checkers remain impartial. Another area of improvement in this proposal is determining a strategy for how to provide accountability for emissions disclosures.
Im seeking clarity related to there the quantitative GHG emissions data would be located, how it would be collected/regulated, and how if possible the list of seven GHGs covered by the Kyoto Protocol might be evaluated/changed.