As we have posted for a while, and as this article confirms, the SEC has published “The Enhancement and Standardization of Climate-Related Disclosures” (ie, proposed rule changes) for both domestic and foreign public companies.
These rule changes create requirements for public company disclosures on climate-related Scope 1, Scope 2 and Scope 3 emissions.
So, if you are not a public company, should you ignore this?
No, you should not ignore this, as there is both risk and opportunity for you.
As to your immediate risk – For those public companies that either believe Scope 3 emissions are material to investors, or that have included Scope 3 in their emission reduction targets/goals, they will be required to seek sustainability-program carbon emission Scope 1 and Scope 2 data from their value-chain (both upstream and downstream)….and this will cause them to adjust their selection of all organizations in their value chain, likely impacting you.
As to your future risk – The number of public companies that follow the above and include Scope 3 will grow quickly, having a greater impact on you.
As to your immediate opportunity – As a certified sustainable private company with a carbon neutral program, you will be able to support your existing clients who seek Scope 3 information.
As to your future opportunity – As the SEC states at the bottom of page 217 – “In addition, large companies that are voluntarily disclosing Scope 3 emissions information currently are also working with suppliers to increase access to emissions data and improve its reliability which could have positive spillover effects for other companies that use the same suppliers.” – those suppliers who proactively become sustainable and have a carbon neutrality program, and participate in helping their pubic-company clients with their Scope 3 reporting, will be in demand by other public companies facing the same issues.
Edenark Group can help you become environmentally certified sustainable and help you develop your carbon neutral and ESG programs.