Republicans want answers from the Securities and Exchange Commission (SEC) regarding its proposed climate disclosure rule. Last month, Senator Tim Scott (R-S.C.) and Representatives Patrick McHenry (R-N.C.) and Bill Huizenga (R-Mich.) sent a letter to SEC Chairperson Gary Gensler saying the rule goes beyond the agency’s “mission, expertise, and authority.”
Gensler was admonished for refusing to answer four other letters sent by Republicans on the climate disclosure rule in the summer and fall of 2022. This latest message reminds Gensler of Congress’s oversight duties, while raising worries about the SEC’s lack of transparency.
Scott, McHenry, and Huizenga pointed out multiple concerns about the future of the economy, should the proposal go into effect. These issues include whether the SEC bothered to analyze whether the climate disclosure proposal could potentially lead to rising energy prices. Other issues involve whether Gensler’s office received legal advice on whether the proposed rules exceeded the SEC’s mission and whether the climate rule violates the First Amendment.
The SEC was urged to reveal which employees worked on the proposed climate rule and whether they used private, nongovernmental devices. Questions were also raised on talks with the White House, other federal agencies, and non-governmental organizations on the climate proposal. Full lists of officials and representatives were requested in all three instances.
Gensler’s staff was given a March 8th deadline on responding to Congress’ requests. It would be wise for the SEC to adhere to the letter. There’s no reason for the opaque process by which these climate rules are being put together. The SEC can’t stray from its stated mission of protecting investors; facilitating capital formation; and maintaining fair, orderly, and efficient markets. The good news is that Chair Gensler seems to be recognizing this mission creep. What’s not known is if other commissioners share his realization.