March 22, 2022
I applaud the efforts of the SEC to regulate climate disclosures for public companies. This is a welcome advance that will help investors make informed decisions regarding risks and long-term return on investment. There is, however, a very large loophole in how the language is presently written around scope 3 emissions accounting. Companies are asked to disclose their scope 3 emissions \"if material.\" In reality, many companies do not know if their scope 3 emissions are material or not because they have chosen not to complete an assessment. Evidence suggests that scope 3 emissions are significant, if not the majority of emissions, for most companies, particularly in the food and agriculture sector (my area of expertise). Requiring companies to disclose their scope 3 emissions would be a game-changer for investor transparency and decision-making. I urge you to remove the materiality clause and ensure that all publicly traded companies are required to disclose scope 3 emissions. This will result in a fair and transparent playing field for companies and their shareholders.