The SEC is finalizing climate rules while California has its own regulations

A MARTÍNEZ, HOST:

California is going to make thousands of big companies report the risks they face from climate change. They'll also have to account for emissions that are raising global temperatures. The new disclosure rules will start kicking in about two years from now. Meanwhile, the U.S. government has yet to weigh in with its own climate rules. Here's NPR's Michael Copley.

MICHAEL COPLEY, BYLINE: Lots of companies tout their efforts to respond to climate change. The problem is, it's hard to verify if the information is accurate or to compare information from different companies. That's where regulators at the Securities and Exchange Commission come in. Here's SEC Chair Gary Gensler.

(SOUNDBITE OF ARCHIVED RECORDING)

GARY GENSLER: Investors today are making investment decisions based on climate risk disclosures. We're trying to bring some comparability.

COPLEY: Gensler was talking at a recent congressional hearing about rules his agency proposed that would make public companies report their climate risks and account for their greenhouse gas pollution.

(SOUNDBITE OF ARCHIVED RECORDING)

GENSLER: The proposal is really to capture the risks that investors want to understand.

COPLEY: California is racing ahead with its own regulations, but the SEC rules are an even bigger deal to businesses and climate activists. In part, that's because they think the federal requirements could shape how regulations evolve globally. That's made the SEC the target of intense lobbying. A lot of companies want the agency to pare back how much information they have to disclose.

AARON PADILLA: We share their objective of wanting to inform investors or present information that consumers and other stakeholders want and need, but it's a matter of being judicious to get that right.

COPLEY: Aaron Padilla is an executive at the American Petroleum Institute. The group represents the U.S. oil and gas industry. Padilla says flooding investors with information about corporate emissions won't necessarily help them make better decisions.

PADILLA: Chair Gensler and the other commissioners in the SEC still have an opportunity to get this right.

COPLEY: Groups pushing for stronger regulations say investors need all the information they can get to protect their money, and more disclosures could have climate benefits. A recent study found making companies report their emissions could pressure them to cut their climate pollution. The SEC is expected to finalize its climate rules in the coming months.

Michael Copley, NPR News.

(SOUNDBITE OF EMANCIPATOR'S "DODO") Transcript provided by NPR, Copyright NPR.