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SEC Climate Disclosure Rule - Final Rules

The SEC approved landmark regulation helping investors better understand climate-related risks and opportunities to make more informed investment decisions.

“The Securities and Exchange Commission is merit-neutral...we’re agnostic with regard to climate risk itself but we have a role to play about the disclosures made by companies.” - Gary Gensler, SEC Chair

On March 6, 2024, the Securities and Exchange Commission's (SEC) approved the ‘Final Rules’ for climate-related disclosure rules. This regulation, although substantially revised from its initial proposal released two years ago, remains essential to emphasizing the importance of transparent, reliable, consistent, and comparable reporting on climate-related risks. Transitioning from guidance to enforceable regulation, the Final Rules are intended to help investors make more informed decisions. 

The Climate-Related Disclosure Rule mandates domestic and foreign registrants to disclose extensive climate-related information in their registration statements and annual reports. This includes detailing climate risks, adaptation strategies, board oversight of climate initiatives, and the effects of climate goals and targets on operations. Companies are required to disclose the actual and potential impacts of climate-related risks on their business strategy, financial condition, and operations, if they are considered ‘material’ or relevant to investors.

Additionally, only non-exempt large accelerated filers (LAFs)  and accelerated filers (AFs) will need to disclose direct Scope 1 and Scope 2 emissions that are material to investors. Smaller companies, initially considered in the proposal, are not required to report these emissions in the Final Rules. The SEC also dropped reporting requirements for Scope 3 emissions, addressing concerns about the feasibility and costs of reporting indirect emissions.

To enhance corporate transparency and accountability, disclosures must now be filed with the SEC as part of companies' annual filings, not just web postings. This includes attestation reports for accelerated and large accelerated filers during their second quarterly filings. In addition, the rule simplifies reporting by moving footnote requirements from audit-focused Regulation S-X to reporting-standard-based Regulation S-K, addressing concerns about the complexity of previous requirements.

Key Expectations for the new “Final Rules”


  • Emphasis on the role of boards and management.
  • Integration of the Board in the company's risk management processes.
  • Identification of responsible committees and their processes.
  • Details for how the board monitors progress towards disclosed climate targets or transition plans.



  • The material climate risks that may impact the registrant’s business strategy, results of operations, or financial condition.
  • Potential and actual impacts from climate-related risks, if material, on the registrant’s strategy, business model, and outlook.
  • Internal carbon pricing if deemed materially impactful.
  • Materiality assessments, short, medium and long term.
    • Requires both quantitative and qualitative considerations.
  • Mandatory disclosure of significant use of carbon offsets and renewable energy credits if material, emphasizing costs above the 1% threshold.
  • Required limited assurance level assurance report, transitioning to reasonable assurance for LAFs after an additional period (7th fiscal year).
  • Disclosures should account for costs and losses incurred due to severe weather events and natural conditions
  • Material expenditures and impacts:
    • Quantitative and qualitative information about material expenditures and impacts on financial estimates and assumptions that are the direct result of mitigation of or adaption to climate-related risks, transition plans, or targets or goals or actions taken to achieve or progress toward those targets or goals.



  • Risk management processes aimed at identifying, assessing, and managing climate risks.
  • Integration into the overall risk management system or processes.
  • Scenario analysis if deemed materially impactful.



  • If a registrant's climate-related target is material or likely to materially affect the business, results of operations, or financial condition, disclosures about the targets/goal and the financial implications of these objectives are required:
    • The scope of activities encompassed. 
    • The time horizon envisioned.
    • The baseline against which progress will be tracked (if applicable).
    • How the registrant plans to achieve its targets or goals.
    • An update each year of how the registrant is progressing relative to its targets or goals and how such progress has been achieved.
    • Information about carbon offsets or renewable energy certificates (“RECs”) if they are a material component of the plan to achieve climate-related targets or goals.   



  • Direct Scope 1 and Scope 2 greenhouse gas emissions disclosure mandated for large accelerated filers (LAFs) and accelerated filers (AFs) if deemed 'material'.



Annual Reports or Registration Statements That Include Financial Statements for the Year Ending December 31:
Registrant Type Financial Statement Disclosures and All Other Disclosures Disclosures About Material Expenditures and Impacts Scope 1 and Scope 2 GHG Emission Disclosures Attestation on Scope 1 and Scope 2 GHG Emission Disclosures
Large Accelerated filer 2025 2026 2026 Limited assurance — 2029 Reasonable assurance — 2033
Accelerated filer (excluding SRCs and EGCs ) 2026 2027 2028 Limited assurance — 2031 Reasonable assurance — Not required
Nonaccelerated filer, SRCs, and EGCs 2027 2028 Not required Not required

Sia Partners offers robust support to our clients to accelerate the move to compliant reporting, aligning your Climate Risk capabilities to globally recognized standards and regulatory taxonomies.

How Sia Partners Can Assist


  • Performing a gap analysis of current practices and requirements with our Rapid & In-Depth Assessment tool.
  • Evaluating current-state capabilities and implementation efforts.
  • Performing materiality analysis.
  • Defining roadmap to reach desired maturity level.

Standard & Metrics

  • Developing metrics and targets to manage climate-related risks.
  • Aligning client’s emissions metrics with SEC requirements.
  • Creating emissions dashboard reporting / trajectory reporting based on targets.

Risk & Controls

  • Establishing risk governance framework and climate risk taxonomy.
  • Creating data governance policies and procedures.
  • Designing climate data quality controls and data validation processes.


  • Understanding SEC Data requirements and associated process dependencies.
  • Aligning business emissions to accounting protocols.
  • Enhancing data collection process infrastructure.


  • Exploring key automation opportunities.
  • Synchronizing finance data and SEC data requirements.
  • Designing and automating processes and data quality controls.

Disclosure Reporting

  • Coordinating internal stakeholders.
  • Reviewing draft disclosure and providing feedback.
  • Conducting subsequent shareholder engagement discussions.
  • Development of sustainability/ESG reporting strategies, including stakeholder identification, expectation analysis, content and design target setting, and creation of a comprehensive framework and roadmap. 
  • Execution of sustainability reports through narrative development, content outlining, standards application, report design and writing, governance facilitation, and creation of a consistent visual ESG brand messaging strategy. 

Contact us for more information

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