Jun. 11, 2021
Dear Securities and Exchange Chair Gensler, Thank you for SEC’s invitation to provide public comment on Climate Change Disclosures, - which rightly identifies the urgent need for - mandatory climate, - environmental, - social, and - governance (ESG) disclosures. Climate change poses potentially catastrophic risks to - the environment, - communities, and - the financial system. As a result, it is vital for you to require climate-related disclosures - in order to meet the SEC’s mandate to - protect investors; - ensure fair, orderly, and efficient markets; and - facilitate capital formation. In particular, the fossil fuel industry and sectors that rely on agro-commodities, - including the agribusiness and consumer goods sectors, pose risks to the financial system - that must be disclosed by companies whose - direct operations and - supply chains are involved in these sectors - as well the financial institutions that enable them. Disclosures must: 1. Be mandatory and standardized - in a way that makes them comparable across firms and sectors. 2. Be easily - accessible, - transparent, - clear, and - decision-useful to all investors across different levels of sophistication. 3. Include both qualitative disclosures, such as - the information currently reported - under the voluntary Task Force for Climate Related Financial Disclosures, - as well as specific line-item, quantitative disclosures. 4. Be published in annual and quarterly SEC filings, and - to the extent possible, should be included in the audited financial statements. - Include quantitative metrics and qualitative information about - governance, - strategy, and - risk management. 5. Cover both physical risks and transition risks - that affect enterprise value, - the impacts that issuers have on society, - the natural environment, - the global financial system, and - investors as a whole, including risks associated with - human rights and - the rights of Indigenous Peoples and - other vulnerable and marginalized populations. 6. Report on total greenhouse gas emissions (Scopes 1, 2, and 3) - linked to their own operations and - their tier one suppliers. Include quantitative and qualitative data - used in scenario analysis in regards - to scope 3 emissions and - specifically direct and supply chain emissions - from land use, - land use change, and - forestry. This data should include detailed data on - company land banks, - land and forest management practices, - sustainability and governance policies, and - deforestation-reduction targets. 7. Be in a machine-readable format - to allow academics and other stakeholders - to easily use this information and - compare, analyze, and identify - discrepancies which could be the basis for shareholder pressure and enforcement action. Sincerely, Carolynn Kohout