On 6 March 2024, the Securities and Exchange Commission
(SEC) proposed and adopted an environmental disclosure rule (Enhancement and
Standardisation of Climate-Related Disclosures for Investors). The rule and its
explanation consist of 886 pages; consequently, this article attempts to
illustrate briefly the environmental metrics or factors that comprise this rule
and which US companies have to report on in their audited financial statements.
The SEC metrics for calculating and reporting greenhouse gas (GHG) emissions
are largely based on the Greenhouse Gas Protocol and the Task Force on Climate
Related Financial Disclosures (TCFD). In Africa, the Johannesburg Stock
Exchange (JSE) in South Africa has introduced similar environmental metrics for
GHG disclosures. In the future, South Africa’s Climate Change Bill, 2022, will
empower the Minister to issue regulations that promote standardised
environmental metrics for companies, similar to the SEC rule. This article also
briefly focuses on the Corporate Sustainability Reporting Directive (CSRD).