(Southeast Texas Record)—The Liberty Justice Center and the Pelican Institute for Public Policy have jointly filed a lawsuit against the U.S. Securities and Exchange Commission to challenge recent regulations that require public companies to make extensive disclosures related to climate change.
On March 6, the SEC issued a climate “disclosure rule” that requires all companies registered with the SEC to provide a broad swath of information related to climate change in their annual reports.
The requirements include a company’s “climate-related target or goal” and any progress towards meeting it; greenhouse gas emissions; the impact of severe weather events; carbon offsets or renewable energy credits; and processes of identifying, assessing, and managing climate-related risks.
The challenging groups argue that the rule should be set aside because the federal laws creating and empowering the SEC do not authorize it to require such detailed disclosures on environmental matters, which will burden companies and alter their behavior far more than ordinary financial disclosures.
The lawsuit contends that the rules unconstitutionally compel speech in violation of the First Amendment – requiring companies by law to implicitly endorse viewpoints on climate change that are the subject of intense public debate.
“The SEC didn’t enact these rules to protect investors’ financial interests – it enacted them to pursue an ideological agenda and influence companies’ decisions to favor that agenda,” said Jacob Huebert, president of the Liberty Justice Center. “Worse yet, the rules force companies to file reports that implicitly endorse the SEC’s views on climate change in violation of the First Amendment. We look forward to seeing these rules struck down.”
The petition was filed March 26 in the U.S. Court of Appeals for the Fifth Circuit.