SEC's New Guidance for Public Companies to Discuss Material Effects of Climate Change on Financial Performance

SEC's New Guidance for Public Companies to Discuss Material Effects of Climate Change on Financial Performance

The SEC yesterday announced new disclosure guidance requiring public companies to discuss material effects of climate change on their financial performance. This new requirement exposes a risk for public companies and their directors and officers who should be insured against securities litigation arising from inadequate disclosure. Many Directors & Officers insurance policies exclude coverage for claims arising from "pollution," which could mean a hole in coverage for such disclosure violations. I encourage companies to take a look at their policies and insist that their carriers fill in that potential gap by endorsement or otherwise. Contact me if I can be of assistance.