Bicameral Oversight: Huizenga, McHenry, Scott Demand Information from SEC Chair on Disastrous Climate Disclosure Proposal
Washington, February 22, 2023
Today, Chairman of the Subcommittee on Oversight and Investigations, Bill Huizenga (R-MI), the Chairman of the House Financial Services Committee, Patrick McHenry (R-NC), and the Ranking Member of the Senate Committee on Banking, Housing, and Urban Affairs, Senator Tim Scott (R-SC), sent a letter to Securities and Exchange Commission (SEC) Chair Gary Gensler demanding records and other information related to the proposed climate disclosure rule, including responses to previous requests by numerous members of both the House and the Senate that Chair Gensler has failed to provide. The Republican leaders emphasize that the proposed rule exceeds the SEC’s mission, expertise, and authority and—if finalized in any form—will unnecessarily harm consumers, workers, and the U.S. economy.
Read the full letter to SEC Chair Gensler here.
Read key excerpts from the letter to SEC Chair Gensler below:
“We are writing to request information regarding the Securities and Exchange Commission’s (‘SEC’s’) proposed rule on ‘The Enhancement and Standardization of Climate- Related Disclosures for Investors”’ (the ‘climate disclosure rule’). This sweeping rule exceeds the SEC’s mission, expertise, and authority and, if finalized in any form, will unnecessarily harm consumers, workers, and the U.S. economy.
“Congress created the SEC to carry out the mission of protecting investors, maintaining fair, orderly, and efficient markets, and facilitating capital formation—not to advance progressive climate policies. Instead of pursuing its clear statutory mission, the SEC, under your leadership, has chosen to flout the democratic process and pursue its progressive social agenda through the promulgation of this extraordinarily expansive climate disclosure rule.
“We remind you of the limitations on your statutory authority, particularly following the Supreme Court’s recent ruling in West Virginia v. EPA. In that case, the Court held that under the major questions doctrine, a government agency must point to clear congressional authorization for its actions; it cannot simply create new interpretations of existing law to justify far-reaching policy changes that Congress never intended. Congress did not intend for the SEC to be an arbiter of business strategies, much less the determining body for climate policies. This abuse of the rulemaking process, and blatant partisan efforts to circumvent the legislative process, are outside the bounds of the SEC’s mission and authority.
“Under your leadership, the SEC has shifted away from its principles-based disclosure regime to a partisan, activist, and prescriptive approach. This includes implementing a climate agenda that is outside the scope of its mission and which will have significant economic and political consequences for the Nation and our capital markets. These efforts far exceed the SEC’s authority, jurisdiction, and expertise. Recently, it has been reported that you and other SEC officials have acknowledged this concern and are now weighing the impact of the inevitable legal challenges the SEC will face with this proposal once it is finalized. This aggressive, overly broad approach to controversial rulemaking is particularly concerning in a time where prices are skyrocketing—harming consumers, workers, and the entire U.S. economy.
“Numerous members of Congress, in both the House and the Senate, have sought information from the SEC pertaining to this proposed rule, but the SEC thus far has failed to comply with these requests. Consequently, we are renewing several of those information requests outlined below, as well as a series of new information requests pertaining to this flawed rule. We are deeply concerned with the SEC’s lack of transparency and disregard for legitimate Congressional oversight inquiries, and call on you to be more responsive to Congressional information requests going forward.”