The Securities and Exchange Commission (SEC) formally proposed rescinding its 2024 climate-risk disclosure rule on May 29, 2026. SEC Chair Paul Atkins directed the proposal, which states that the 2024 rules are "a dramatic overreach of the Commission's statutory authority and, independently, unsound as a matter of policy."

The 2024 rule, adopted under then-Chair Gary Gensler, never took effect. The SEC paused implementation on April 4, 2024, shortly after adoption while the Eighth Circuit Court of Appeals reviewed nine consolidated lawsuits challenging the regulation.

Under the 2026 rescission proposal, the SEC would eliminate requirements for public companies to disclose climate-related risks with material impacts on business strategy, environmental governance processes, financial effects of severe weather and natural conditions, and Scope 1 and Scope 2 greenhouse gas emissions. Scope 1 emissions are direct emissions from company operations; Scope 2 are indirect emissions from purchased electricity.

Atkins argued the 2024 rules imposed substantial costs on companies and investors without justified informational benefits. He said "SEC disclosure obligations should comply with the Commission's statutory authority, be guided by materiality as the North Star, avoid the practical effect of dictating corporate behavior, and be imposed only when the expected benefits justify the likely costs and burdens."

Some environmental groups and investor advocates oppose the rescission. Director of Land Systems at Clean Air Task Force Kathy Fallon said the rule "was an important step toward giving investors consistent information about financially material climate risks."

Senior attorney for the Environmental Defense Fund Stephanie Jones said climate disclosure "makes sure people have information that they need to make important financial decisions," and the EDF stated it intends to "vigorously oppose rolling back the rule, which would threaten the financial security of workers and retirees who have their life savings invested in the markets."

The SEC initially proposed climate disclosure requirements on March 21, 2022. On March 6, 2024, the SEC commissioners voted 3–2 along party lines to adopt the rule.

After President Donald Trump (R) took office in January 2025, the SEC reversed course. Acting Chair Uyeda asked the Eighth Circuit Court of Appeals to delay arguments in March 2025, and the SEC voted to end its defense of the rules on March 27, 2025. In September 2025, the Eighth Circuit ordered the SEC to formally rescind, repeal, modify, or resume defending the rules.

The notice-and-comment rulemaking process will remain open for 60 days after Federal Register publication. 

Ballotpedia tracks support for and opposition to the environmental, social, and corporate governance (ESG) investing movement. To learn more about arguments for, against, and about ESG, click here. For more information on reform proposals related to ESG policy, click here.