A potentially forthcoming climate reporting requirement from the U.S. Securities and Exchange Commission has legal experts worried about a looming litigation risk for companies that don’t have a robust team in place for tracking emissions data.

The SEC announced and opened a public comment period for its proposed climate disclosure rule in March 2022. The rule aims to standardize the climate-reporting information required from companies across the board, and is expected to go into effect this April for large public companies and in 2025 for smaller companies.

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