Federal Securities and Exchange Commission Remains Silent on Future Climate Disclosure Rule Enforcement Following Legal Challenge
The U.S. Securities and Exchange Commission (SEC) has asked the U.S. Court of Appeals to rule on petitions filed against its climate disclosure rules for companies. The rules, announced and adopted in March 2024, require public companies in the U.S. to provide disclosure on climate risks, plans to address those risks, the financial impact of severe weather events, and greenhouse gas emissions originating from their operations [1][2].
The rules have faced a series of legal challenges, including a lawsuit against the rule filed by 25 Republican state attorneys general and an appeals court motion requesting a stay of the rules led by the U.S. Chamber of Commerce [1]. In July 2025, the SEC submitted a status report to the court stating that while a majority of current Commissioners believe the SEC lacked statutory authority to issue these rules, the SEC cannot prejudge future actions pending the court’s decision [1].
The SEC has stated that it does not intend to review or revisit its climate disclosure rules at this time [3]. However, the Commission has not answered whether it will enforce the rules if the court upholds them, instead urging the court to rule first, as that decision will guide any future SEC actions on modification, replacement, or rescission of the rules [2][3][4].
SEC Commissioner Caroline Crenshaw has criticized the Commission's response, accusing the Commission of trying to get around the process to rescind the rule [3]. Crenshaw also accused the Commission of not wanting to say that it has no intention of allowing the Climate-Related Disclosure Rules to go into effect [1]. In response, Crenshaw stated that the unspoken truth under the current Commission is that they do not intend to allow the Climate-Related Disclosure Rules to go into effect [1].
The litigation remains stayed (paused) pending the court’s ruling, and the court’s decision is expected to heavily influence future regulatory and legal developments related to these climate disclosure rules [1][4]. The current status of the SEC's climate disclosure rules is that the SEC does not intend to review, reconsider, or rescind these rules at this time. Instead, the SEC has asked the U.S. Court of Appeals for the Eighth Circuit to proceed with litigation challenging the rules and issue a ruling on their validity rather than the SEC engaging further in administrative reconsideration or enforcement decisions for now [1][2][3][4].
It is worth noting that many states have intervened to defend the SEC's Climate-Related Disclosure Rules [1]. The court’s ruling will be crucial to determining whether the SEC may revisit or enforce these rules in the future [1][2][3][4].
References: [1] CNBC. (2025, July 23). SEC asks court to rule on climate disclosure rules as it withdraws defense. Retrieved from https://www.cnbc.com/2025/07/23/sec-asks-court-to-rule-on-climate-disclosure-rules-as-it-withdraws-defense.html [2] Reuters. (2025, July 23). SEC asks court to rule on climate disclosure rules as it withdraws defense. Retrieved from https://www.reuters.com/business/us-sec-asks-court-rule-climate-disclosure-rules-it-withdraws-defense-2025-07-23/ [3] The Wall Street Journal. (2025, July 24). SEC's Climate Disclosure Rules in Limbo as Court Decision Pending. Retrieved from https://www.wsj.com/articles/secs-climate-disclosure-rules-in-limbo-as-court-decision-pending-11630413788 [4] Bloomberg Law. (2025, July 23). SEC Asks Court to Rule on Climate Disclosure Rules as It Withdraws Defense. Retrieved from https://news.bloomberglaw.com/us-law-week/sec-asks-court-to-rule-on-climate-disclosure-rules-as-it-withdraws-defense
- The SEC has asked the U.S. Court of Appeals to rule on the validity of the climate disclosure rules, as the Commission does not intend to review, reconsider, or rescind these rules at this time.
- The court's decision on the SEC's climate disclosure rules will be crucial in determining whether the Commission may revisit or enforce these rules in the future.
- In the meantime, many states have intervened to defend the SEC's Climate-Related Disclosure Rules, showing support for their implementation in industry, policy-and-legislation, and general-news.
- The science community, environmental-science, and even finance sectors closely follow the developments regarding the climate-change disclosure rules, as they could potentially impact the industry's plans, processes, and overall response to climate-change.
