On May 29, 2026, the US Securities and Exchange Commission (SEC) proposed to repeal entirely its 2024 climate-reporting rules for public companies. According to the SEC, the 2024 rules “were a dramatic overreach of the Commission’s statutory authority and, independently, unsound as a matter of policy.”
As background, in March 2024, the SEC narrowly adopted rules it stated would standardize climate-related disclosures by public companies. In brief, the rules would require detailed reporting on climate risks, targets, and goals for public companies, as well as their Scope 1 and 2 emissions and footnote disclosures on expenditures resulting from severe weather events and other natural conditions. Trade associations and other stakeholders promptly challenged the rules in courts nationwide on grounds that the SEC had exceeded its statutory authority, had acted arbitrarily and capriciously and without substantial evidence, and had failed to account for the vast costs of the rule. The cases were eventually consolidated before the US Court of Appeals for the Eighth Circuit. Not long afterward, in April 2024, the SEC stayed implementation of the regulations pending judicial review of the legal challenges, and the rules remain stayed today. The SEC eventually voted not to defend the rules in March 2025, and the Eighth Circuit continues to hold the case in abeyance pending the SEC’s further action.
The SEC’s May 2026 proposing release reevaluates the SEC’s prior policy determinations and notes several reasons for the proposed repeal. First and foremost, the SEC now believes the 2024 climate rules exceeded the agency’s statutory authority. The proposing release also cites several policy grounds for rescission, including the high implementation costs of the rules, various conflicts with the SEC’s policy objectives of facilitating capital formation and promoting public company status, and because the SEC’s existing disclosure requirements and anti-fraud provisions already require disclosure about the effects of climate-related matters when material.
Public comments on the proposal are due 60 day after its publication in the Federal Register. The SEC’s original climate proposal received over 16,000 public comments, and as high as 24,000 by one estimate. Accordingly, we expect an equally robust comment process on the rescission. After reviewing public comments, the SEC would be required to vote again to finalize the repeal of the 2024 rules.
