Why the SEC’s Climate Disclosure Mandate Makes Meteorologists a Must Have for Every Business

While some are calling the new disclosure initiatives weaker, extreme and severe weather events must be addressed. My prediction is regardless of litigation this section will remain intact as weather events continue to become more extreme, as we are already seeing in 2024. Companies will need expert meteorologists to communicate and draft these risks for full disclosure.

The mention of extreme weather in the context of the SEC’s 2024 climate related disclosure rules is specifically related to the requirement for companies to disclose expenditures, charges, and losses incurred as a result of severe weather events. Companies are required to disclose this information if the aggregate amount of such expenditures, charges, and losses equals or exceeds 1% threshold. This requirement is part of the broader set of rules aimed at providing investors with detailed information on how climate related risks, including severe weather events, impact a company’s financial condition and operations.

The SEC goes on to mention specific weather events.

“The capitalized costs, expenditures expensed, charges, and losses incurred as a result of severe weather events and other natural conditions, such as hurricanes, tornadoes, flooding, drought, wildfires, extreme temperatures, and sea level rise, subject to applicable one percent and de minimis disclosure thresholds, disclosed in a note to the financial statements;”

SEC.gov | SEC Adopts Rules to Enhance and Standardize Climate-Related Disclosures for Investors