Unsurprisingly, the Securities and Exchange Commission is facing legal challenges to its new climate rule after years of warnings from companies, investors, and activists alike. The novel rule, which forces publicly traded companies to report greenhouse gas emissions and exposure to other climate-related risks, goes well beyond the SEC’s mandate to protect investors and facilitate efficient capital formation. 

Now that the industry has had time to examine the 885-page rule more closely, businesses are raising concerns that the thicket of disclosure requirements creates significant legal risk for them and their shareholders, the very investors the SEC was created to protect.