On March 21, the Securities and Exchange Commission (SEC) proposed new rules that would require companies to disclose climate risk-related information in its annual financial reports and registration statements. As expected, the proposed disclosures are similar to ones based on globally used disclosure frameworks, such as the Taskforce for Climate Financial Disclosures and the Greenhouse Gas Protocol. The proposed rules do not apply to asset-backed issuers and the SEC stated it is continuing to evaluate climate-related disclosures with respect to asset-backed securities.
In March 2021, SFA submitted a comment letter tailored to the securitization industry in response to the SEC’s request for public input on climate change disclosures. Although the SEC appears to have scoped out ABS from its current proposal, SFA will engage with membership to discuss the relevant questions raised within the proposal and draft a formal response.