Gino DiCaro

Corporate climate change disclosure

By Gino DiCaro, VP, Communications

Capitol Update, May 2, 2008 Share this on FacebookTweet thisEmail this to a friend

On May 5th, the Senate Appropriations Committee will consider SB 1550 (Dean Florez, D-Shafter), which would establish a disclosure standard for use by publicly held companies doing business in California that addresses "climate change" risks or opportunities. The legislation’s intent is to make it easier for companies to make such disclosures and to help investors make more informed decisions, however the bill would not promote the goals it purports to achieve.

Assessment of risks or opportunities prior to regulations under the state’s landmark Global Warming Solutions Act enacted in 2006 (AB 32, Fabian Nunez, D-Los Angeles) or enactment of any federal law limiting emissions would be premature and misleading to investors, by either over- or under-stating the potential risks or opportunities.  Furthermore, reporting the risks and opportunities of climate change impacts is nearly impossible, as information will vary as impacts will be felt over a span of decades (if not centuries), are not adequately predictable with existing climate change models, and are widely dependent upon the success or failure of international regulatory schemes. Until more clarity and consensus about the likely impact of climate change is available, it might be misleading for companies to make such assessments.    

Additionally, due to the fact that SB 1550 disclosures would be voluntary, companies may choose not to disclose climate change risks and opportunities because they do not have sufficient confidence in the accuracy of the information.  But, their unwillingness to disclose may hurt them in the marketplace, even though it is impossible to assess the true risks and opportunities at this time.  

SB 1550 creates a new and unreasonable burden on California employers that they can ill-afford to undertake.  CMTA strongly urges you to express your opposition to SB 1550.

Read more Regulatory / Legal articles

Capitol updates archive 989898989