ESG Litigation, Enforcement Risks Rising Among SEC Registrants

The future of ESG regulation is up in the air. New regulations—including the SEC climate rule and the California climate statute—are currently facing numerous legal challenges, and several state legislators have introduced bills that, if successful, would create new jurisdiction-specific climate disclosure regimes.

While the courts and relevant legislators have yet to determine whether these regulations will ever become effective, companies are already disclosing that they’re facing ESG-related litigation and enforcement risks.

Item 105 of Regulation S-K requires companies to disclose the “material factors that make an investment in the registrant or offering speculative or risky” in their Form ...