The Securities and Exchange Commission (SEC) submitted a proposal to rescind its 2024 climate-risk disclosure rule to the Office of Information and Regulatory Affairs on May 4, 2026. The rule never took effect because litigation paused its implementation shortly after adoption.
SEC staff is also preparing recommendations to the commission to rescind the rule at Chair Paul Atkins' direction. In a May 8, 2026, letter to the Eighth Circuit Court of Appeals, the SEC said it plans to reconsider the rules through notice-and-comment rulemaking and does not intend to renew its defense in court. The agency said staff has prepared recommendations to address commissioners' concerns that the rules exceed the commission's statutory authority and that costs outweigh benefits.
A SEC representative said that "the Commission is focused on returning the agency to its core mandate — in line with its legal authority — restoring a materiality-focused approach to securities regulation."
The rules would have required public companies to disclose:
- Climate-related risks that have materially affected or are reasonably likely to materially affect business strategy, results of operations, or financial condition
- Environmental governance processes
- Financial effects of severe weather events and other natural conditions in audited financial statements
- Scope 1 (direct) and Scope 2 (indirect) greenhouse gas emissions for certain companies
The rules did not require disclosure of Scope 3 emissions from supply chain partners, which were included in the proposed version.
The three current commissioners — Atkins, Mark Uyeda, and Hester Peirce — have all stated the rules extend beyond the agency's authority. Atkins and Peirce were appointed by President Donald Trump (R), while Uyeda was appointed by President Joe Biden (D). The commission currently has two vacancies.
In March 2024, the commission voted 3-2 to adopt the rule, with then-Chair Gary Gensler supporting it and Commissioners Mark Uyeda and Hester Peirce voting against it.
Nine lawsuits challenged the regulations immediately after adoption. The SEC paused implementation on April 4, 2024, while the Eighth Circuit Court of Appeals reviewed the consolidated cases. After President Donald Trump (R) took office in January 2025, then acting chair Uyeda asked the court to delay arguments. Atkins directed staff to withdraw the SEC's defense in March 2025. In September 2025, the Eighth Circuit ordered the SEC to formally rescind, repeal, modify, or resume its defense of the rules.
The SEC’s move parallels broader Trump administration efforts to roll back climate- and ESG-related regulations that officials say exceed agencies’ statutory authority, including the EPA’s February 2026 repeal of the 2009 greenhouse-gas endangerment finding.
California has climate risk reporting requirements on its books, and New York is working to advance its own climate reporting law, meaning some companies could still face climate disclosure requirements at the state level even if the SEC rescinds its rule.
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