Feb. 16, 2023
February 16, 2023 I am happy to see the US Securities and Exchange Commission's focus on more consistent, comparable, and reliable information about climate-related risks when reporting. This will allow for a clear opportunity to understand a company's current emission results, plans for the future, and successful execution of the plans. This will be a welcomed improvement for companies that are low-carbon-driven and environmental innovators. Could you clarify the following: 1) What will define material impact on the business? Depending on the size of the company and the type of emissions, this could allow the more significant emitters not to report as accurately, which is a concern of mine. 2) Define what is meant by the statement safe harbor for liability for scope 3 emissions. Measuring and reporting on any of the three scopes is a challenging task. Scope 3, by definition, is out of the hands of the specific reporting company. What protection will there be if the Scope emissions are incorrectly posted? This liability protection would need to be extended to the service companies that provide the emission measurement results to the company. What protection will service providers have when they give the company the results but do not draft the final disclosure document? 3) At what frequency would dramatic changes in emissions results, good or bad, need to be updated or disclosed, as this could affect investors? 4) Lastly, companies that have started emission reduction plans and have proactively rolled out climate-related risk-management plans and strategies consider the details of this confidential business information and competitive advantage. How will this program protect those companies that are measuring all three scopes, planning emission reduction strategies, and efficiently executing these plans? Monitoring, Measurement, and Verification operations are not without significant resources, operational dedication, and cost. Companies want to keep the best practices and lessons learned in-house.