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March 6, 2024

How the SEC’s Final Rule Mandates Physical Climate Risk Disclosure — And What You Can Do About It


Jupiter — the Trusted Leader in Climate Risk Analytics — Can Help Companies Prepare Now for Reporting and Resilience

By Megan Arnold, Regulatory Intelligence Manager, Jupiter

Today, the Securities and Exchange Commission (SEC) took an unprecedented step forward in its effort to safeguard the U.S. and global economies from climate-change-related financial risk by publishing its final disclosure rules.

The final rules mandate that, starting in Fiscal Year 2025, large, publicly traded corporations must assess and disclose material impacts of current and future physical and transition climate risk upon their asset portfolios, operations, and financial performance. 

Its physical risk assessment requirement encompasses impacts from both acute (extreme weather events, such as hurricanes or wildfires) and chronic (caused by long-term trends, like sea level rise) climate-driven perils.

What You Need to Know

For reporting companies, the urgent questions are:

  • What does the final regulation require?
  • When are its deadlines?
  • How do I get out in front of the compliance process swiftly and effectively?

The IPCC’s AR6 report of 2021-2023 predicts that climate-change impacts—which are already far reaching and extreme—will increase in frequency and severity over time. Many of these impacts are material to corporations’ financial and operational resilience.  

Virtually every business will need to adapt by assessing material physical risks—and strategically planning to adapt and build resilience to safeguard investments and economic stability. 

Climate disclosure requirements are growing across the global economy. With disclosure rules aligned with TCFD guidelines, it will be easier for companies to comply with the SEC and other U.S. climate regulations, such as California’s SB261 bill, as well as other global jurisdictions, such as Canada’s OSFI and the UK’s Financial Conduct Authority. 

How Jupiter Can Help You

The SEC climate rule focuses on the disclosure of climate-related risks that have material impacts on the business, operations, strategy, and financial conditions. The rules specify the need for both quantitative and qualitative considerations in determining material risk.

Jupiter is prepared today to help your company respond to these questions and move forward. With ClimateScore™ Global, the gold-standard climate analytics solution, you can leverage high-resolution, forward-focused peril metrics to comply with the SEC’s requirements, swiftly and effectively.

Reach Out to Jupiter

Learn how our climate risk and analysis tools and expertise can help you get on the right path for disclosure and climate resilience. Request a demo now.

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