Critics of the SEC’s proposed climate disclosure rule are digging a little deeper on what exactly Securities and Exchange Commission (SEC) Chair Gary Gensler had to say during his testimony following the House Financial Services Committee’s hearing, “Oversight of the Securities and Exchange Commission (SEC)” in April. This was the committee’s first hearing with the SEC Chair since Rep. Patrick McHenry (R-N.C.) took the helm in January.
After Chairman Gensler was asked to elaborate on the Commission’s legal authority to enforce climate-focused regulations, Chairman Gensler frequently prefaced his responses by stating that the “SEC is not a climate regulator” or not “a climate policy agency.” He instead made the point that the Commission is a “market regulator,” “a disclosure regulator,” and “a capital markets regulator.” However, this is contradictory to the actions the Commission has taken to regulate climate disclosures.
Over the course of the last year that the proposed SEC climate disclosure rule has been under review, the Commission has continued to assert its authority and stake its claim as to why it should be dipping its toes into an area in which it has no congressionally mandated right to regulate.
In a video recently posted on Twitter, which highlights the inconsistencies and unanswered questions that were left following the hearing, Gensler attempts to reassure House members by saying that he is “a firm believer in congressional oversight.” However, as Rep. Barry Loudermilk (R-Ga.) rightfully put it, the Commission likes to “hurry things along before Congress can have its due oversight.” Now, with the proposed rule forecasted to be delayed until fall, with no answers in sight, many impacted companies are facing even more confusion as the Commission attempts to rein in its congressional overstep.