Leave No Trace: SEC Proposes to Rescind Climate-Related Disclosure Rules

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Summary

On May 29, 2026, the U.S. Securities and Exchange Commission (the “SEC”) proposed the rescission of the climate-related disclosure rules originally proposed in 2022 and ultimately adopted in March 2024 (the “Climate Rules”). If finalized, the proposed rescission, set forth in Release No. 33-11421 (the “Proposed Rescission”), would eliminate the Climate Rules in their entirety, leaving no trace that they were ever adopted in the first place.

This alert summarizes the Climate Rules, the procedural history leading to this action, and the practical implications for public companies that continue to face climate-related disclosure obligations under existing disclosure regimes.

Background

The SEC adopted the Climate Rules on March 6, 2024, creating a detailed disclosure regime requiring public companies to report material climate-related risks and certain greenhouse gas (“GHG”) emissions data in their SEC filings. The Climate Rules required certain registrants to provide information on material Scope 1 and Scope 2 emissions and to file an attestation report from a third-party expert verifying the accuracy of that information.

States, business groups, and industry organizations immediately challenged the validity of the Climate Rules, arguing in part that the SEC had exceeded its statutory authority. The litigation was consolidated in the U.S. Court of Appeals for the Eighth Circuit in Iowa v. SEC. On April 4, 2024, the SEC voluntarily stayed the effectiveness of the Climate Rules pending resolution of the litigation, and, ultimately, the Climate Rules were never enforced.

The Proposed Rescission is now subject to a 60-day public comment period, which concludes on August 3, 2026. A final rescission would require a subsequent SEC vote.

Procedural History Leading to the Proposed Rescission

The path to the Proposed Rescission unfolded over more than a year following the change in presidential administration:

• In March 2025, the SEC withdrew its defense against legal challenges to the Climate Rules.
• In April 2025, a coalition of 18 states and the District of Columbia intervened to uphold the Climate Rules, and the Eighth Circuit granted a motion to hold the case in abeyance.
• In September 2025, the Eighth Circuit directed the SEC to take action either to reconsider the Climate Rules by notice-and-comment rulemaking or to renew its defense of the Climate Rules. The Proposed Rescission reflects the SEC’s reconsideration of the Climate Rules through notice-and-comment rulemaking.
• On May 29, 2026, the SEC publicly issued the proposing release setting forth its rationale for the Proposed Rescission.

In connection with the SEC’s issuance of the Proposed Rescission, Chairman Paul S. Atkins stated that “SEC disclosure obligations should comply with the SEC’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.”

Practical Implications for Public Companies

While the Proposed Rescission reflects the SEC’s reduced emphasis on climate disclosure, companies may still be subject to other climate-related reporting obligations. Companies should consider the following:

• Registrants’ General Obligation to Disclose Material Information. SEC rules require that registrants disclose, in addition to the information expressly required by SEC regulation, “such further material information, if any, as may be necessary to make the required statements, in the light of the circumstances under which they are made, not misleading.” See Rule 408 under the Securities Act of 1933, as amended, and Rule 12b-20 under the Securities Exchange Act of 1934, as amended.

• The SEC’s 2010 Climate Disclosure Guidance Remains in Effect. The SEC’s 2010 interpretive guidance on climate-related disclosures under existing SEC rules continues to apply. Companies remain obligated to disclose material climate-related risks under existing rules, including Regulation S-K Items 101 (Description of Business), 103 (Legal Proceedings), 105 (Risk Factors), and 303 (Management’s Discussion and Analysis of Financial Condition and Results of Operations).
• California Climate Disclosure Laws. California’s SB 253 and SB 261 continue to advance. SB 253 requires entities doing business in California with annual revenues exceeding $1 billion to report Scope 1 and Scope 2 GHG emissions annually, with the first reporting deadline on August 10, 2026. Scope 3 reporting under SB 253 begins in 2027. SB 261 requires entities doing business in California with annual revenues exceeding $500 million to publish biennial climate-related financial risk reports, although enforcement is currently stayed pending appeal before the Ninth Circuit. Companies should confirm whether they are subject to these laws and prepare accordingly.
• Other State Legislative Activity. New York lawmakers are considering climate disclosure legislation modeled in significant respects on California’s framework. In addition, Minnesota and Colorado have enacted legislation requiring certain categories of companies to make climate-related disclosures, and legislation requiring emissions-related disclosure has been introduced but not enacted in Illinois, New Jersey and Washington.
• International Reporting Obligations. Companies with operations in the European Union remain subject to the Corporate Sustainability Reporting Directive (“CSRD”) and the Corporate Sustainability Due Diligence Directive (“CSDDD”), which require climate and sustainability reporting. The International Sustainability Standards Board (“ISSB”) global sustainability disclosure standards continue to apply in jurisdictions that have adopted them.
• Investor Expectations. Despite the federal pullback from climate-related disclosure obligations, certain investors may still expect detailed corporate disclosures with respect to climate- and emissions-related information. Companies may wish to familiarize themselves with existing climate-related disclosure frameworks, such as the Task Force on Climate-related Financial Disclosures (the “TCFD”), if their shareholders are likely to look for additional information in this regard.

Conclusion

The SEC’s Proposed Rescission represents a shift in federal climate disclosure policy and, if finalized, will formally end the most ambitious climate transparency initiative ever undertaken by the SEC. However, climate-related disclosure obligations are not disappearing. The growing patchwork of state laws, international regulations, and investor expectations means that many companies—particularly large enterprises with multi-jurisdictional operations—will continue to face climate reporting requirements regardless of the outcome of the federal rulemaking.

For additional information about any of the above developments, or to discuss any questions that you may have, please contact a member of Maynard Nexsen’s Public Company Advisory Group.

This Client Alert is for information purposes only and should not be construed as legal advice. The information in this Client Alert is not intended to create and does not create an attorney-client relationship.