House Financial Services Subcommittee on Oversight and Investigations Chairman Bill Huizenga (R-Mich.) said the Securities and Exchange Commission has dramatically underestimated the cost of its proposed rule to institute climate-related investor disclosures.

Details: During a hearing on the SEC proposal, Huizenga said that while the SEC has estimated the proposal would cost current reporting companies roughly $10 billion per year, a recent study puts that number at closer to $25 billion. He also questioned whether the SEC has congressional authorization to implement rules related to environmental or climate issues.

ICBA Opposition: ICBA strongly opposes the SEC proposal, noting in its comment letter and in an American Banker op-ed that it contains no exemption for community banks and threatens to impose unprecedented costs and potential liabilities on local institutions.

Background: The SEC proposal would require registrants to include certain climate-related disclosures in their registration statements and periodic reports about governance of climate-related risks, relevant risk management processes, direct and indirect greenhouse gas emissions, and more.