Companies listed on US stock exchanges — including Canadian ones — are pushing back on new Securities Exchange Commission (SEC) rules for disclosing carbon emissions in a move backed by the Biden Administration as it poises to spend hundreds of billions of dollars in infrastructure spending..The new rules, which were first proposed last summer but delayed, would force companies to disclose more information on so-called ‘Scope 3’ emissions, which are defined as indirect emissions that stem from everything from employee commuting, waste disposal, business travel and even purchased goods and services..According to the Washington Post, the new rules affect everything from pizza deliveries to financial services in addition to the typical huff and puff smokestack industries..It’s being pushed by the US government, which according to the Brookings Institute, spends about $655 billion a year in goods and services making it by far the largest outside contractor in the country. It’s also being advocated by climate activists who are threatening legal action to force the issue..But the companies are complaining the rules are too onerous, costly and impractical. In February, the US Chamber of Commerce wrote a letter to the Federal Acquisition Regulatory Council calling it “inappropriate and inefficient” with “no offsetting benefits to speak of.”.“The proposed rule would impose immense costs on government contractors of all sizes, costs that would be passed on to the government and ultimately to taxpayers. This would undermine rather than advance the goal of an economic and efficient system of contracting,” it said..It could also have implications for Canadian companies listed in New York. There are 238 Canadian firms with a market capitalization of $1.63 trillion that trade on US stock exchanges, the vast majority of which are ‘cross-listed’ meaning they simultaneously trade in Toronto as well..Given the federal government successfully negotiated a carve-out from ‘Buy American’ provisions in Biden’s Inflation Reduction Act, they would be subject to the same rules, although there presently is no requirement to report Scope 3 emissions in Canada..Nonetheless, the Canadian Climate Institute is pushing for the government to do just that. In 2022 the federal government announced plans for large financial institutions to begin reporting Scope 3 emissions starting in 2024 but the CCI wants it to move more aggressively in following the US lead. .“In Canada there is little momentum for emissions disclosure requirements and this puts Canada’s ability to compete in the low-carbon transition at risk,” it said..“The lagging performance of Scope 3 disclosures from Canadian companies reflects a need for regulators to catch up with their international peers.”
Companies listed on US stock exchanges — including Canadian ones — are pushing back on new Securities Exchange Commission (SEC) rules for disclosing carbon emissions in a move backed by the Biden Administration as it poises to spend hundreds of billions of dollars in infrastructure spending..The new rules, which were first proposed last summer but delayed, would force companies to disclose more information on so-called ‘Scope 3’ emissions, which are defined as indirect emissions that stem from everything from employee commuting, waste disposal, business travel and even purchased goods and services..According to the Washington Post, the new rules affect everything from pizza deliveries to financial services in addition to the typical huff and puff smokestack industries..It’s being pushed by the US government, which according to the Brookings Institute, spends about $655 billion a year in goods and services making it by far the largest outside contractor in the country. It’s also being advocated by climate activists who are threatening legal action to force the issue..But the companies are complaining the rules are too onerous, costly and impractical. In February, the US Chamber of Commerce wrote a letter to the Federal Acquisition Regulatory Council calling it “inappropriate and inefficient” with “no offsetting benefits to speak of.”.“The proposed rule would impose immense costs on government contractors of all sizes, costs that would be passed on to the government and ultimately to taxpayers. This would undermine rather than advance the goal of an economic and efficient system of contracting,” it said..It could also have implications for Canadian companies listed in New York. There are 238 Canadian firms with a market capitalization of $1.63 trillion that trade on US stock exchanges, the vast majority of which are ‘cross-listed’ meaning they simultaneously trade in Toronto as well..Given the federal government successfully negotiated a carve-out from ‘Buy American’ provisions in Biden’s Inflation Reduction Act, they would be subject to the same rules, although there presently is no requirement to report Scope 3 emissions in Canada..Nonetheless, the Canadian Climate Institute is pushing for the government to do just that. In 2022 the federal government announced plans for large financial institutions to begin reporting Scope 3 emissions starting in 2024 but the CCI wants it to move more aggressively in following the US lead. .“In Canada there is little momentum for emissions disclosure requirements and this puts Canada’s ability to compete in the low-carbon transition at risk,” it said..“The lagging performance of Scope 3 disclosures from Canadian companies reflects a need for regulators to catch up with their international peers.”
