New SEC Rules Likely to Affect Small Farms in US
A proposed Securities and Exchange Commission rule requiring farmers to give detailed climate data to public companies has been challenged by over a hundred House members from both parties. The new rules are likely to affect small farmers in the US.
The planned ESG regulatory standards for small farms are 'unworkable,' according to House members, and might prevent farmers from engaging with public firms.
The new rules are known as "Enhanced and Standardisation of Climate-Related Disclosures for Investors" and are part of a current trend toward ESG investing. Investors analysing ESG parameters in addition to regular data on business performance are referred to as ESG investors.
118 House members oppose the new ESG regulation, including Democrats and Republicans. They have written and signed a letter to Gary Gensler, Chairman of the Securities and Exchange Commission, expressing their concerns (SEC).
According to the SEC's proposed regulation, registrants must include a specified number of climate-related disclosures in their registration statements and periodic reports. These climate-related disclosures provide details on climate-related risks that are reasonably likely to have a major impact on their business, results of operations, or financial condition.
Gary Gensler spoke in March to support the new rule, saying:
“I am pleased to support today’s proposal because, if adopted, it would provide investors with consistent, comparable, and decision-useful information for making their investment decisions.”
The American Farm Bureau Federation, on the other hand, backed House members who were critical of the new rule. They say the rule will force farmers and ranchers to track data for which they lack the capacity.
Source: Small Business Trends
