SEC Proposes Rescinding 2024 Climate-Disclosure Rule, Opens Public Comment

The Securities and Exchange Commission has formally proposed scrapping its own 2024 climate-disclosure rule, a regulation that was challenged almost immediately, stayed by the agency and never took effect.

The move, published May 29 in a proposed rule titled “Rescission of Climate-Related Disclosure Rules,” matters because it shifts the fight from whether the SEC could defend the rule in court to whether it should erase the federal climate-reporting mandate altogether through a new rulemaking. For public companies and investors, that marks a more definitive attempt to unwind what had been one of the federal government’s biggest efforts to standardize climate-risk reporting.

The proposal targets the SEC’s March 6, 2024, final rule, “The Enhancement and Standardization of Climate-Related Disclosures for Investors.” That rule would have required many public companies, on a phased-in basis, to disclose climate-related risks, information about governance and risk management, some greenhouse-gas emissions data and certain climate-related effects in financial statements.

But the rule never went into effect in practice. The SEC stayed it on April 4, 2024, as legal challenges mounted, and the agency said in its rescission proposal that the rules were never codified in the Code of Federal Regulations because of that stay.

In the new proposal and an accompanying press release, the SEC said it “proposes to rescind the climate-related disclosure rules in their entirety.” The agency said the 2024 rules exceeded the SEC’s statutory authority and were also unsound as policy.

SEC Chair Paul S. Atkins said the agency’s disclosure requirements should stay tied to its legal mandate and to what is material to investors. “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,” Atkins said in the agency’s May 29 release.

The proposal formalizes a turn the commission had already begun. On March 27, 2025, the SEC voted to end its defense of the 2024 rule in court. The lawsuits over the rule had been consolidated in the U.S. Court of Appeals for the Eighth Circuit, which on Sept. 12, 2025, put the cases on hold while the SEC either reconsidered the rule through notice-and-comment rulemaking or resumed defending it.

Now, the commission is pursuing that reconsideration. The proposal opens a 60-day public comment period after publication in the Federal Register. That means the climate rule has not been finally repealed; the SEC must still review comments and decide whether to adopt a final rescission.

Commissioner Hester Peirce publicly backed the move, saying, “I support the rescission proposal and look forward to hearing feedback from the public.”

Business groups quickly welcomed the SEC’s action. The National Association of Manufacturers said it would file comments supporting rescission, and the U.S. Chamber of Commerce also praised the proposal.

Investor advocates pushed back. As You Sow, a shareholder advocacy group, said it would fight the move and argued that investors still want standardized climate-risk disclosures. The group said rescinding the rule would mean the SEC is “turn[] its back on the investors it exists to protect.”

Even if the SEC ultimately withdraws the 2024 rule, that will not end climate-reporting obligations for all companies. Some businesses still face disclosure requirements under California law and certain foreign regimes, meaning compliance planning will not disappear even if the federal rule does.