SEC Chair Gensler Says ‘Scope 3' Emissions Disclosures Aren't ‘Well Developed,' Hinting They Could Be Scaled Back in Climate Rule

U.S. Securities and Exchange Commission Chairman Gary Gensler testifies before Senate Banking, Housing and Urban Affairs Committee, during an oversight hearing held on Capitol Hill, Washington, September 15, 2022.

The Securities and Exchange Commission introduced the rule last year. It required publicly traded companies to disclose greenhouse gas emissions using a tiered system. Scope 1 was direct emissions from operations, Scope 2 were indirect from buying oil, gas and other forms energy and Scope 3 disclosures were much more nuanced. Gensler stated that "there are far more companies who are already disclosing Scope 1 or 2," during a Monday interview with the Council of Institutional Investors. Gensler stated that the record 15,000 comments received by the SEC on the rule was a new high, which is "more than any other role in our history," Gensler added. Gensler stated that about a third of these unique comments are comments that weigh in on different aspects the rule. Gensler added, "About three quarters of those are unique comments. It was standard for the agency "to review all that, think though the economics and think through any legal authorities that commenters raised." Gensler was addressed by Sens. The agency will not allow the climate-related disclosure rule to be published. To overturn a rule related to ESG investing that was proposed by the Labor Department. Gensler said, "We get input about economics, legal authority, and we get input of course, on policy." "And then staff reviews it, makes recommendations to the five-member committee... but it's really staying within law and how courts interpret it."