Full Title: Assessing the Costs and Benefits of Mandatory Climate Risk Disclosure
Author(s): Jack Lienke, Alexander Song
Publisher(s): Institute for Policy Integrity at the New York University School of Law
Publication Date: January 19, 2022
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Climate impacts are already threatening major economic sectors in novel ways and could cost the global economy trillions of dollars annually by 2100. Yet, despite their serious implications, climate-related financial risks are under-disclosed by companies and are rarely reported in a way that is useful for investors.
As the Securities and Exchange Commission (SEC) prepares a new climate risk disclosure rule, this report analyzes relevant case law and highlights best practices that the SEC can follow in estimating the rule’s economic impacts. With trade groups expected to challenge any new disclosure requirement by claiming that its costs exceed its benefits, defending the rule’s economic analysis will be crucial in court.