CHARLESTON — West Virginia Attorney General Patrick Morrisey is leading a 24-state coalition to fight a U.S. Securities and Exchange Commission plan that would require companies to make policy statements not related to financial performance.
He sent a supplemental letter July 13. That followed a formal comments letter he and the coalition filed last month.
The new letter takes the recent U.S. Supreme Court ruling in West Virginia v. Environmental Protection Agency into consideration. The ruling said Congress — not a federal administrative agency — has the power to decide major issues of the day.
Morrisey
Under the proposed SEC rule, public companies would be required to produce disclosures concerning greenhouse gases and climate change. Among other things, the proposal would require companies to disclose greenhouse gas emissions they directly or indirectly produce, and how climate risk affects their businesses. The companies would have to report on their climate risks, as well as risks related to the physical impact of storms, drought and higher temperatures.
Morrisey says the Supreme Court’s ruling “thus confirms that the ‘major questions doctrine’ operates as a ‘distinct’ constraint on agency power.”
“We explained in our earlier comment letter why the Commission’s Proposed Rule offends that doctrine, and West Virginia v. EPA confirms we’re right,” Morrisey wrote in the supplemental letter. “Just as the EPA did, the Commission purports to discover in a long-extant statute an unheralded power. …
“And after adopting a paternalistic reading of its mandate, the Commission concludes that it can constrain how public companies function simply because influential investors think it’s best to squeeze out disfavored, carbon-based energy sources. If this sort of regulatory overreach does not constitute a sweeping policy judgment on a major question, then we struggle to see what would.”
The 500-plus page proposed rule is called “The Enhancement and Standardization of Climate-Related Disclosures for Investors.” The comments were sent to SEC Secretary Vanessa A. Countryman.
West Virginia was joined in the letter by Alabama, Alaska, Arizona, Arkansas, Florida, Georgia, Idaho, Indiana, Kansas, Kentucky, Louisiana, Mississippi, Missouri, Montana, Nebraska, North Dakota, Ohio, Oklahoma, South Carolina, South Dakota, Utah, Virginia and Wyoming.