Subject: S7-10-22: WebForm Comments from Norman Umberger (Profanity Flag)
From: Norman Umberger
Affiliation: Investor and Improvement Guru

May. 29, 2022


May 29, 2022

 This proposed regulation is not needed nor desired by investors.

All SEC-regulated entities are already required to report on all matters material to their business.  This requirement protects investors.  Climate change risks are already included in the discussions of business risks, if the entity believes that the impact could be material.

Requiring the climate change risks to be reported in a format that the SEC thinks is relevant provides no additional information, but significant costs and the potential for confusion as there is not an industry standard for tracking such risks nor one for determining materiality.

Investors would prefer to learn what the entity believes is the risk, not what the SEC believes is the risk.  And as with such requirements as mine safety, there will be significant numbers of entities whose exposure to climate change risks is not material.  Investors will not learn anything from a section answered not applicable, just as investors learn nothing from the standardized disclosures such as the forward-looking statements.  Those would be best placed in SEC documents like Exhibit 99-1, rather than bloating an entitys documents such as the 10-K.  Investors gain nothing from such statements.

The SEC could do well to streamline the reporting to include only material risks, as determined by the entity.  We investors are interested in knowing such things as how much of the entitys business is concentrated in single customers, how much is concentrated in an industry, how much is concentrated in a geographical region, and so on.  So many of the risks presented in the required documents, such as the 10-K, are hidden in bland, standardized CYA (cover your ass) statements that nothing meaningful can be gleaned from the statements.  Such fluff should be reduced and eliminated, not added to.  Requiring enhanced and standardized climate-related disclosures only adds to the fluff and provides no information helpful to investors and the decisions we make or the protections we enjoy.