Change of climate

28 January 2010 By Christopher Swann

SEC boss Mary Schapiro’s heart is in the right place in asking U.S. companies to reveal more about the threats from global warming. They may even coax businesses into better analyzing the risks. But for now, the SEC’s initiative will likely just mean more boilerplate.

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The Securities and Exchange Commission on Jan. 27 said companies should disclose risks associated with climate change in their annual reports.

After a 32 vote, the SEC suggested that companies have a responsibility to discuss the effects of the environment and pending rules on their business.

The commission split along party lines with the two Republicans, Kathleen Casey and Troy Paredes, rejecting the proposal.

The SEC said that companies should consider the impact of legislation and regulation, the impact of international accords, the indirect consequences of regulation on business trends and the physical impact of climate change.

In September 2007 a coalition of the nation's largest institutional investors, representing $1.5 trillion in assets, sent a petition to the SEC urging it to clarify that material climate risks must be disclosed.

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