May. 09, 2022
May 9, 2022
I am commenting to the U.S. Securities and Exchange Commission in response to the certain proposed rule, The Enhancement and Standardization of Climate-Related Disclosures for Investors, release no. 33-11042, for which comments are due before May 20, 2022.
My single comment is that the proposed rule should be revised to not be registered public accounting firm centric and to expressly provide that an attorney at law can be a GHG emissions attestation provider.
Of course the proposal does not exclude attorneys, but it also does not encourage their participation.
Attorneys have had a significantly expanded role with boards of directors since Sarbanes Oxley and the SEC is pushing that in the very proposed rule, by requiring that board members be involved with and publicly describe their involvement in these new GHG emission disclosures all that involves advice and counsel of attorneys.
But this proposal stops short of acknowledging the ongoing role of attorneys in the SECs 2010 guidance on how the Commissions existing disclosure rules may require disclosure of the impacts of climate change on a registrants business or financial condition. Attorneys have been key in those annual reviews.
While some may question the inclusion of Scope 3 GHG emissions (i.e., is there enough certainty in the marketplace to provide good data, and the like) that Scope 3 is included in this proposal hugely expands the number of businesses impacted from not only public companies but to this upstream and downstream in their value chain that will have to provide data to the public company. Such is an exponential growth, across the globe, driven by this rule, and will require many more professionals be involved in the space of GHG emissions.
Attorneys and their law firms are set up to provide legal opinions of counsel, including being independent of and avoiding conflicts with their clients as required by state rules, and do it in many contexts today, advises boards in this context is an ideal role for attorneys.
The final rule should expressly identify attorneys as possible GHG emissions attestation providers.