The SEC Climate Rule

Book: SEC Climate Change. Chapter-1-1

Ordering Information

This book is under development. The information provided here is taken from the current draft.


 

Chapter 1: How We Got Here

Abstract
Two Disclaimers
Goals of the Book
Book Structure
The Securities and Exchange Commission
The SEC Rule
   Types of Rule
   Justification for the Rule
   Principles for Effective Disclosure
   Greenwashing
Risk
   Components of Risk
   Physical and Transition Risks
Response
   Governments 
   Individuals / Small Groups
   Business and Industry

Chapter 2 — A Changing Climate

Abstract
The Pre-Industrial Baseline
Greenhouse Gases
   Not Just CO2
   Water Vapor
   Methane
   Nitrous Oxide
   Hydrofluorocarbons (HFCs)
   Aerosols
IPCC — Intergovernmental Panel on Climate Change
   1) Global Warming of 1.5 Degrees
   2) Physical Science Basis Report
   3) Impacts, Adaptation and Vulnerability Report 
   4) Mitigation of Climate Change Report
   5) Synthesis Report
   Fact Sheet 
Conferences of the Parties
   COP21 — The Paris Agreement
   1.5°C
   COP26
   2030 Goals
Temperature Impacts
   Committed Warming
   Tipping Points
Net Zero by 2050
Systems
   An Age of Limits
   Social and Personal Response
Communication Failure

Chapter 3 — The SEC Rule

Abstract
The Climate-Related Disclosures Rule
Materiality
Timing
Analysis
Section I. Introduction
Section II. Discussion
   A. Overview of the Climate-Related Disclosure Framework
   B. Disclosure of Climate-Related Risks  
   C. Disclosure Regarding Climate-Related Impacts on Strategy, Business Model, and Outlook
   D. Governance Disclosure 
   E. Risk Management Disclosure
   F. Financial Statement Metrics   
   G. GHG Emissions Metrics Disclosure 
   H. Attestation of Scope 1 and Scope 2 Emissions Disclosure
   I. Targets and Goals Disclosure
   J. Registrants Subject to the Climate-Related Disclosure Rules and Affected Forms
   K. Structured Data Requirement
   L. Treatment for Purposes of Securities Act and Exchange Act
   M. Compliance Date
Section III. General Request for Comments
   Commissioner Peirce Comments
   Sutton Comments
   Comment #1
   Comment #2
   Comment #3
Section IV. Economic Analysis
Scopes
   Scope 1 — Direct Emissions
   Scope 2 — Indirect Emissions
   Scope 3 — Corporate Value Chain Standard
   Scope 4 — Avoided Emissions
Difficulties with Scope 3
   Complex Systems
   Efficiency Paradox
   Past, Present and Future
   Transportation
   Private Companies
   Scope 3 Safe Harbor
Materiality

Chapter 4 — Standards and Regulations

Abstract
The Task Force on Climate-Related Disclosures (TCFD)
   Recommendations
   Types of Risk
   Opportunities
TCFD Final Report
   A. Introduction
   B. Climate-Related Risks, Opportunities and Financial Impacts
   C. Recommendations and Guidance
   D. Scenario Analysis and Climate-Related Issues
   E. Key Issues Considered and Areas for Further Work
   F. Conclusion 
   Eleven Recommendations
   Governance
   Scenario Analysis
   Strategy
   Risk Management
   Metrics and Targets
The Greenhouse Gas Protocol
Climate Disclosures Standard Board (CDSB)
ISSB
Network for Greening the Financial System (NGFS)
Principles for Responsible Investment (PRI)
FSOC (Financial Stability Oversight Council)
Federal Reserve
FASB
ISO 14064 
EPA
International Rules

Chapter 5 — Reporting and Auditing

Abstract
Reporting Standard
Environmental Protection Agency
Timing
Renewable Energy Credits
Internal Carbon Pricing
Emission Factors
Shortage of Expertise
TFCD Illustrative Implementation Plan
TFCD Good Practice Handbook
Examples
Auditing

Chapter 6 — Reducing Emissions and Risk

Abstract
Project Management
   Team Composition
   Schedule
   Human Resources
Transition
Carbon Pricing
Metrics

Chapter 7 — Toward Net Zero

Abstract
Examples
Technology
   Batteries
   Hydrogen
   Ammonia 
   Nuclear Power (Fission)
   Nuclear Power (Fusion)
Carbon Capture and Sequestration
Geoengineering

Chapter 8 — Scenarios

Abstract
Energy
   Peak Oil 
   Energy Grid
   Energy Returned on Energy Invested (ERoEI)
   Representative ERoEI Values
   The Energy Cliff
   Productivity Slowdown
   Jevons' Paradox
TFCD Scenario Analysis
Perceived Tipping Points
   The Titanic
   Lake Mead 
Two Roads
   The First Road — Stability
   The Second Road — Uncertainty
   The Road Chosen 
   Overshoot / Collapse
Forcing Functions
Stories
Finance

Appendix A — Numbers and Terminology

Units of Measurement
Energy and Power
Very Large Numbers

Appendix B — The Three-Hundred Year Party

Peak Forests
The Atmospheric Engine
The Industrial Revolution
Faith in Progress

Appendix C — A Process Safety Analogy

Historical Background
Technical Information
Hazards Analysis

References

Ian Sutton

Chapters

1. How We Got Here
2. A Changing Climate
3. The SEC Rule
4. Standards and Regulations
5. Reporting and Auditing
6. Reducing Emissions and Risk
7. Toward Net Zero
8. Scenarios