Washington, D.C. – Today, Ranking Member Tim Scott (R-S.C.) joined fellow Senate Banking Committee member Senator Kevin Cramer (R-N.D.), Representative Kevin Hern (R-Okla.-01), and 32 additional Members of Congress in filing a bicameral amicus brief in Texas Alliance of Energy Producers, et al v. SEC. The brief requests the United States Court of Appeals for the Eighth Circuit vacate the agency’s climate disclosure rule.
Ranking Member Scott has led opposition in Congress against the rule. The brief states, “The SEC, as a securities regulator, is not empowered to impose sweeping climate-related regulations on publicly traded companies. Congress has demonstrated historical reluctance to pass broad climate legislation, particularly legislation that would dramatically impact federal securities law disclosure requirements. The SEC’s overreach into climate regulation violates the separation of powers and the major questions doctrine, warranting the rule’s invalidation.”
It continues, “Further highlighting the absence of authorization for the SEC’s Climate Rule is its conflict with fundamental tenets of federal securities law that have existed for decades. Specifically, the Climate Rule contravenes the principle of materiality, a cornerstone of federal securities law. […] The SEC’s historical stance and the Supreme Court’s interpretation affirm that immaterial information should not be subject to mandatory disclosure. By focusing on environmental impacts rather than financial materiality, the Climate Rule deviates from the SEC’s statutory mandate. Consequently, the Climate Rule’s disclosure requirements conflict with established federal securities law precepts and should be vacated.”
Under Chair Gary Gensler, the SEC has pursued an aggressive regulatory agenda – proposing and finalizing over 60 rules with limited public comment periods and inadequate cost-benefit analyses. Through congressional oversight, Ranking Member Scott has pushed back on these proposed rules' impact on capital markets, American retirement savers, and businesses.
In February 2023, Ranking Member Scott along with Patrick McHenry (R-N.C.-10) and Bill Huizenga (R-Mich.-04) sent a letter to Chair Gensler demanding records related to the proposed climate disclosure rule. They emphasized that this rule exceeds the SEC's mission and authority and could harm consumers and workers if finalized.
Last June, Ranking Member Scott teamed up with Rep. James Comer (R-Ky.-01) to seek answers from the SEC about its role in facilitating European Union climate policies that might affect American companies adversely.
At a September hearing, Ranking Member Scott pressed Chair Gensler about aggressive rulemaking practices and lack of transparency regarding congressional inquiries.
After announcing its final climate disclosure rule, Ranking Member Scott declared his intent to use the Congressional Review Act process to oppose it.