The U.S. Securities and Exchange Commission (SEC) announced on Friday that it has formally proposed the […]
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SEC Launches Formal Process to Rescind Corporate Climate Reporting Rules
Abatify Summary
Nature & Climate Perspective
**The rollback of federal corporate climate disclosure rules severely limits the standardized tracking of private sector impacts on natural carbon sinks, hindering targeted funding for high-integrity conservation. **
- Without standardized reporting, assessing corporate supply chain impacts on LULUCF (Land Use, Land-Use Change, and Forestry) becomes fragmented and reliant on voluntary disclosures.
- The lack of mandatory climate data complicates the valuation of ecosystem co-benefits, making it difficult to channel capital into high-quality Blue Carbon and biodiversity preservation initiatives.
- Long-term ecological stability is undermined as the absence of federal mandates reduces the corporate incentive to invest in verified, nature-based carbon sequestration projects to offset Scope 3 emissions.
Market & Policy Outlook
**Rescinding the SEC climate disclosure rules creates a deep regulatory divergence with the EU's CSRD and California's climate laws, complicating global corporate compliance and SBTi alignment. **
- This regulatory rollback directly conflicts with the transparency goals of the ICVCM Core Carbon Principles (CCPs), making it harder for investors to verify genuine corporate decarbonization vs. greenwashing.
- While federal rules are stalled, leading multinational corporations will still face pressure to track Scope 3 emissions due to California's SB 253 and international SBTi requirements.
- Market liquidity for carbon credits and I-RECs may experience regional fragmentation as U.S. firms shift back to voluntary, less regulated frameworks for environmental reporting.
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