Introduction
On May 29, 2026, the SEC proposed to rescind the climate-related disclosure rules adopted in March 2024 (the "2024 rules") under then-Chair Gary Gensler. If adopted, the proposal would remove the climate-specific disclosure rules, including new Regulation S-K Subpart 1500, Regulation S-X Article 14, related amendments to Regulation S-X Article 8, form amendments and associated tagging, attestation and expert-consent provisions.
The proposal should be viewed as part of Chair Paul S. Atkins' broader effort to recalibrate SEC disclosure rules around statutory authority, materiality, cost-benefit discipline and capital formation under the aegis of the "Make IPOs Great Again" agenda. The rescission proposal fits within the SEC's stated effort to make becoming and remaining a public company more attractive. In his statement, Chair Atkins emphasized that SEC disclosure obligations should comply with the SEC's statutory authority, be guided by materiality, avoid the practical effect of prescribing corporate behavior and be imposed only where the expected investor-protection benefits justify the related costs and burdens.[1] The proposing release echoes those themes and characterizes rescission as warranted both legally and as a matter of policy.
The SEC's rationale for rescission would not, however, make climate-related disclosure irrelevant. Even without the 2024 rules, companies would still need to assess climate-related matters under the SEC's existing disclosure framework and antifraud principles. Where material, those matters may call for disclosure as risk factors, MD&A, business and legal proceedings, or other company-specific developments relevant to investors.
The proposal is subject to notice and comment, and comments are due August 3, 2026.[2]
Key Takeaways
- The rules remain stayed and have never gone into effect. The SEC stayed the 2024 rules in April 2024 pending judicial review. In March 2025, the SEC voted to stop defending the rules, and on September 12, 2025, the Eighth Circuit held the litigation in abeyance until the SEC either rescinded or modified the 2024 rules through notice-and-comment rulemaking or renewed its defense.
- The SEC proposes a complete rescission. The proposal would rescind the 2024 climate rules in full, including the governance, strategy, risk-management, targets-and-goals, greenhouse gas emissions, attestation, financial-statement and Inline XBRL requirements adopted as part of that rulemaking.
- Existing disclosure obligations remain. The existing 2010 SEC guidance on climate-related disclosures remains part of the disclosure landscape. Accordingly, risk factors, MD&A, business and legal proceedings disclosure, financial-statement rules, Rule 408 and Exchange Act Rule 12b-20 would continue to require climate-related disclosure where information about climate change's impact on a registrant is material.
Background: The 2024 Climate Rules and the Litigation Posture
The proposal follows an unusually contentious rulemaking and litigation path. The SEC adopted the 2024 rules by a 3-2 vote, with Chair Gensler and Commissioners Caroline A. Crenshaw and Jaime Lizárraga voting to approve them and Commissioners Hester M. Peirce and Mark T. Uyeda dissenting.[3] The majority described the rules as a disclosure regime aimed at giving investors more consistent and decision-useful information about material climate risks. The dissenters objected that the rules gave climate issues special treatment, imposed disproportionate compliance burdens and risked turning the SEC's disclosure framework into a tool for broader climate policy. That debate remains the cornerstone of the rescission proposal.[4]
Challenges to the rules were filed almost immediately.[5] A panel of the Fifth Circuit issued a temporary stay in March 2024, and the challenges were later consolidated in the U.S. Court of Appeals for the Eighth Circuit.[6] On April 4, 2024, the SEC stayed the rules pending completion of judicial review.[7] On March 27, 2025, the SEC voted to end its judicial defense of the rules. On September 12, 2025, the Eighth Circuit held the consolidated petitions in abeyance until the SEC either reconsidered the rules through notice-and-comment rulemaking or renewed its defense.[8] The rescission proposal is the SEC's formal response to that order.
What the SEC Proposes to Rescind
The proposed action would withdraw the 2024 rulemaking package as a whole, including:
- Regulation S-K Items 1500 through 1508, which would have created a climate-specific disclosure subpart for governance, strategy, risk management, targets and goals, greenhouse gas emissions, attestation and tagging;
- Regulation S-X Article 8-01 and Article 14, which would have required climate-related financial-statement disclosures, including certain severe-weather and other specified effects;
- Related amendments to Item 601 of Regulation S-K, Regulation S-T, Securities Act Rule 436, and the affected Securities Act and Exchange Act forms, including Forms S-1, S-3, S-4, S-11, F-3, F-4, 10, 10-K, 10-Q and 20-F; and
- Associated iXBRL tagging, attestation and expert-consent mechanics that were designed to support the 2024 rules.
Because the 2024 rules were stayed before they went into effect and were never codified in the Code of Federal Regulations, the proposal is presented as the withdrawal of adopted but not-yet-effective amendments rather than a conventional amendment to already operative rules.
Rationale for Rescission
Statutory Authority and Materiality
The proposing release takes the position that the 2024 rules rested on an unduly broad view of the SEC's authority. In the SEC's current view, the federal securities laws authorize disclosure requirements designed to inform investment and voting decisions, but do not authorize the SEC to impose a comprehensive climate-reporting regime because some investors may use that information for portfolio construction, climate policy or other objectives beyond company-specific financial materiality. The release also invokes recent administrative law decisions to support the SEC's narrower view of its authority. Relying on the major questions doctrine, the SEC argues that the 2024 rules were not ordinary disclosure requirements, but an expansive climate-reporting regime addressing matters of "vast economic and political significance." In the SEC's view, decisions about whether and how public companies should respond to climate change implicate national energy and environmental policy, extend beyond the SEC's comparative expertise and intrude into corporate governance matters traditionally regulated by state law. Because the SEC does not view the federal securities laws as providing the clear congressional authorization required for such a regulatory expansion, the release concludes that the 2024 rules exceeded the SEC's statutory authority. The release also cites Loper Bright Enterprises v. Raimondo for the principle that courts must independently determine the best reading of an agency's governing statutes, reinforcing the SEC's position that the 2024 rules cannot be sustained as a permissible construction of the SEC's disclosure authority.[9]
Cost, Complexity and Public-Company Incentives
The SEC also frames the proposal as a cost and capital-formation measure. The release states that the 2024 rules would have imposed significant annual compliance costs and that rescission would generate substantial cost savings for affected registrants. The SEC estimates annualized cost savings of approximately $4.9 billion per year over a ten-year horizon, while noting that actual savings would vary by company based on industry, size, existing disclosure practices, internal expertise and the complexity of the company's climate-risk profile.
The release further argues that detailed climate-specific disclosure could require competitively sensitive or proprietary information, including information about scenario-analysis assumptions, internal carbon prices, asset-allocation decisions, supply-chain vulnerabilities and strategic plans. In the SEC's current view, those burdens and potential disclosure costs are contrary to its policy objective of making public-company status more attractive.
Existing Rules as the Fallback Framework
The SEC is not proposing a regime in which climate-related information would be categorically outside the federal disclosure requirements. Instead, the proposal leans heavily on the existing materiality-based disclosure framework, including the SEC's 2010 interpretive guidance regarding disclosure related to climate change (the "2010 guidance").[10] The 2010 guidance did not create a climate-specific line-item disclosure regime. Rather, it explained that climate-related matters may need to be addressed under existing disclosure rules when they are material in light of a company's particular facts and circumstances. The guidance focused on areas such as the impact of legislation and regulation, international accords, indirect consequences of regulation or business trends, and the physical impacts of climate change. It also reminded companies that voluntary climate reporting outside SEC filings may still need to be considered when determining what must be disclosed in SEC filings.
The proposing release treats the preexisting framework as a sufficient principle-based disclosure baseline. It also solicits comment on whether the existing rules adequately elicit material climate-related disclosure and whether the SEC should update the 2010 guidance. As a result, the rescission proposal should not be read as the end of SEC's scrutiny of climate-related disclosure. It is better understood as a shift away from prescriptive climate-specific line items and back toward a principles-based, materiality-driven analysis. Consequently, the release points to current requirements that may require climate-related disclosure depending on the facts, including:
- Item 101 business disclosure, including material effects of compliance with government regulations;
- Item 103 legal proceedings disclosure for material environmental or climate-related proceedings;
- Item 105 risk factors for material climate-related risks;
- Item 303 MD&A disclosure for known trends, demands, commitments, events or uncertainties reasonably likely to have a material effect;
- financial-statement requirements, including accounting standards governing contingencies, estimates, impairments and other financial effects; and
- Rule 408 under the Securities Act and Rule 12b-20 under the Exchange Act, which require additional material information necessary to make required statements not misleading.
The proposal suggests that climate disclosure should be particularized to the issuer and its facts, rather than elicited through a mandatory taxonomy that applies broadly across industries and market-capitalization levels.
What Would Not Change
If the proposal is adopted, companies would no longer need to prepare for the specific governance, emissions, attestation, financial-statement and tagging requirements adopted in 2024, but several important constraints would remain.
- Material climate disclosure would still be required when the facts warrant it. For example, a company may need to disclose material physical risks, transition risks, regulation, litigation, customer requirements, capital expenditures, insurance constraints, asset impairments, supply-chain disruptions, energy-price exposure or commitments tied to climate strategy if those matters are material under existing rules.
- Voluntary sustainability disclosures would still carry securities-law and reputational risk. Climate-related statements in sustainability reports, investor presentations, websites, proxy materials and offering documents should continue to be vetted for accuracy, consistency and appropriate caveats. A rescission of the SEC climate rules would not make aspirational, dated or internally inconsistent statements benign.
- The 2010 guidance remains in effect. The SEC asks whether it should revise its 2010 climate guidance, which addressed how existing business, legal-proceedings, risk-factor and MD&A requirements can apply to climate-related matters. The SEC could leave that guidance in place, revise it, or address climate disclosure through future interpretive guidance rather than prescriptive rules.
- Other disclosure regimes may apply. The proposal would not displace state, foreign or contractual climate-reporting obligations. Companies subject to California's SB 253 (which requires Scope 1 and Scope 2 greenhouse gas emissions reporting by entities with over $1 billion in annual revenue, with the first reporting deadline of August 10, 2026), the EU's Corporate Sustainability Reporting Directive or other non-SEC sustainability regimes, or to customer, lender or supply-chain reporting requirements, may still need the data architecture that the 2024 SEC rules would have accelerated.
Next Steps
While the SEC reconsiders the 2024 rules, and while final rescission remains subject to notice and comment and further SEC action (making a final rule unlikely before late 2026 or early 2027), companies should not treat the proposal as a moratorium on climate disclosure. Companies may be able to pause implementation work that is useful only for complying with Regulation S-K Subpart 1500 or Regulation S-X Article 14, but disclosure committees should preserve the controls and internal escalation processes needed to identify material climate-related risks, known trends, proceedings, commitments and financial-statement effects under the existing framework. For their next annual report or registration statement, companies should refresh their 2010-guidance analysis, check SEC-filed disclosure against sustainability reports, websites, investor materials and customer or lender statements, and maintain a current inventory of state, foreign and contractual reporting obligations. As it is unlikely for the SEC to change its position on the rescission of the 2024 rules, companies that decide to comment should not limit their submission simply as support for, or opposition to, rescission; more useful comments may address potential questions in connection with the 2010 guidance, areas where existing rules continue to create uncertainty and how the federal disclosure framework should account for overlapping state, foreign and private reporting regimes.
[1] Statement on Proposing Release for Rescission of Climate-Related Disclosure Rules is available here.
[2] The Federal Register version of the proposal is available here.
[3] See The Enhancement and Standardization of Climate-Related Disclosures for Investors, Release No. 33-11275 (Mar. 6, 2024).
[4] See statement of Commissioner Mark T. Uyeda here and statement of Commissioner Hester M. Peirce here.
[5] See Iowa v. SEC, No. 24-1522 (8th Cir.), and consolidated cases.
[6] Consolidation Order, In re Securities and Exchange Commission, The Enhancement and Standardization of Climate-Related Disclosures for Investors, MCP No. 180 (J.P.M.L. Mar. 21, 2024).
[7] The Enhancement and Standardization of Climate-Related Disclosures for Investors; Delay of Effective Date, Release No. 33-11280 (Apr. 4, 2024) [89 FR 25804 (Apr. 12, 2024)]; see also Sec. & Exch. Comm'n, In the Matter of the Enhancement and Standardization of Climate-Related Disclosures for Investors (Order Issuing Stay), Release No. 33-11280 (Apr. 4, 2024) (order staying Final Rules).
[8] Order, Iowa v. SEC, No. 24-1522 (8th Cir. Sept. 12, 2025).
[9] See Loper Bright Enterprises v. Raimondo, 603 U.S. 369, 400 (2024).
[10] The 2010 guidance is available here.