Securities and Exchange Commission acting Chair Mark Uyeda does not support the agency’s public company climate disclosure rule and has asked staff to notify the federal court assigned to hear a consolidated legal challenge against the rule to delay scheduling the case for arguments.
Uyeda said his views on the rule, which are in stark contrast to those of former Chair Gary Gensler, coupled with a Jan. 20 executive order signed by President Donald Trump directing federal agencies to implement a regulatory freeze, change the facts of the litigation.
“I believe that the court and the parties should be notified of these changes,” Uyeda said in a Feb. 11 statement.
The SEC finalized its climate disclosure rule in March 2024, requiring public companies to divulge a host of climate-related information in their periodic reports and registration statements. After nine lawsuits were filed against the rule, all challenges were combined, and the case was to be heard by the 8th U.S. Circuit Court of Appeals in St. Louis on a consolidated basis.
The agency in April halted implementation of the rule pending the legal challenge.
Uyeda said the court should not schedule arguments in the case to provide time for the commission to “deliberate and determine the appropriate next steps in these cases. The commission will promptly notify the court of its determination about its positions in the litigation.”
Both Uyeda and fellow Republican Commissioner Hester Peirce did not support finalizing the rule last year.
“I continue to question the statutory authority of the commission to adopt the rule, the need for the rule, and the evaluation of costs and benefits,” Uyeda said. “I also question whether the agency followed the proper procedures under the Administrative Procedure Act to adopt the rule.”
Uyeda’s thoughts are similar to the plaintiffs in the consolidated lawsuit, which include energy companies, Republican attorneys general and business groups.
Under Gensler, the SEC filed briefs to the 8th Circuit defending the rule.
Congress gave the SEC “express statutory authority to require disclosure as ‘necessary or appropriate in the public interest or for the protection of investors,’ the SEC said in an Aug. 6 filing, referencing the Securities Act of 1933 and the Securities Exchange Act of 1934. “Consistent with 90 years of disclosure-based regulation, the commission exercised that and other rule-making authority to promulgate the climate-related risk disclosure rules.”
In its August brief, the SEC also said the climate-related risks — and a public company’s response to those risks — can significantly affect a company’s financial performance and position, which is why such a rule is needed.
But now, Uyeda has a different stance. “The commission’s briefs previously submitted in the cases consolidated in the (8th) Circuit do not reflect my views,” he said.
