violent extremism, the spread of infectious dis-
eases, and forced migration; 
(C) the transition impacts that result as the 
global economy transitions to a clean and renew-
able energy, low-emissions economy, including fi-
nancial impacts as climate change fossil fuel as-
sets becoming stranded and it becomes uneco-
nomic for companies to develop fossil fuel assets 
as policymakers act to limit the worst impacts of 
climate change by keeping the rise in average 
global temperature to 1.5 degrees Celsius above 
pre-industrial levels; and 
(D) actions by Federal, State, Tribal, terri-
torial, and local governments to limit the worst 
effects of climate change by enacting policies that 
keep the global average surface temperature rise 
to 1.5 degrees Celsius above pre-industrial levels; 
(3) assessing the potential impact of climate-re-
lated risks on national and international financial 
systems is an urgent concern; 
(4) companies have a duty to disclose financial 
risks that climate change presents to their investors, 
lenders, and insurers; 
(5) the Securities and Exchange Commission has 
a duty to promote a risk-informed securities market 
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that is worthy of the trust of the public as families 
invest for their futures; 
(6) investors, lenders, and insurers are increas-
ingly demanding climate risk information that is 
consistent, comparable, reliable, and clear; 
(7) including standardized, material climate 
change risk and opportunity disclosure that is useful 
for decision makers in annual reports to the Commis-
sion will increase transparency with respect to risk 
accumulation and exposure in financial markets; 
(8) requiring companies to disclose climate-re-
lated risk exposure and risk management strategies 
will encourage a smoother transition to a clean and 
renewable energy, low-emissions economy and guide 
capital allocation to mitigate, and adapt to, the ef-
fects of climate change and limit damages associated 
with climate-related events and disasters; and 
(9) a critical component in fighting climate 
change is a transparent accounting of the risks that 
climate change presents and the implications of con-
tinued inaction with respect to climate change. 
SEC. 3. DISCLOSURES RELATING TO CLIMATE CHANGE. 
Section 13 of the Securities Exchange Act of 1934 (15 
U.S.C. 78m) is amended by adding at the end the following: 
‘‘(s) DISCLOSURES RELATING TO CLIMATE CHANGE.— 
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‘‘(1) DEFINITIONS.—In this subsection: 
‘‘(A) 1.5 DEGREE SCENARIO.—The term ‘1.5 
degree scenario’ means a scenario that aligns 
with greenhouse gas emissions pathways that 
aim to limit global warming to 1.5 degrees Cel-
sius above pre-industrial levels. 
‘‘(B) APPROPRIATE CLIMATE PRINCIPALS.— 
The 
term 
‘appropriate 
climate 
principals’ 
means— 
‘‘(i) the Administrator of the Environ-
mental Protection Agency; 
‘‘(ii) the Administrator of the National 
Oceanic and Atmospheric Administration; 
‘‘(iii) the Director of the Office of Man-
agement and Budget; 
‘‘(iv) the Secretary of the Interior; 
‘‘(v) the Secretary of Energy; and 
‘‘(vi) the head of any other Federal 
agency, as determined appropriate by the 
Commission. 
‘‘(C) BASELINE SCENARIO.—The term ‘base-
line scenario’ means a widely-recognized anal-
ysis scenario in which levels of greenhouse gas 
emissions, as of the date on which the analysis 
is performed, continue to grow, resulting in an 
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increase in the global average temperature of 1.5 
degrees Celsius or more above pre-industrial lev-
els. 
‘‘(D) CARBON DIOXIDE EQUIVALENT.—The 
term ‘carbon dioxide equivalent’ means the num-
ber of metric tons of carbon dioxide emissions 
with the same global warming potential as one 
metric ton of another greenhouse gas, as deter-
mined under table A–1 of subpart A of part 98 
of title 40, Code of Federal Regulations, as in ef-
fect on the date of enactment of this subsection. 
‘‘(E) CLIMATE CHANGE.—The term ‘climate 
change’ means a change of climate that is— 
‘‘(i) attributed directly or indirectly to 
human activity that alters the composition 
of the global atmosphere; and 
‘‘(ii) in addition to natural climate 
variability observed over comparable time 
periods. 
‘‘(F) COMMERCIAL DEVELOPMENT OF FOS-
SIL FUELS.—The term ‘commercial development 
of fossil fuels’ includes— 
‘‘(i) exploration, extraction, processing, 
exporting, transporting, refining, and any 
other significant action with respect to oil, 
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natural gas, coal, or any byproduct thereof 
or any other solid or liquid hydrocarbons 
that are commercially produced; and 
‘‘(ii) acquiring a license for any activ-
ity described in clause (i). 
‘‘(G) COVERED ISSUER.—The term ‘covered 
issuer’ means an issuer that is required to file 
an annual report under subsection (a) or section 
15(d). 
‘‘(H) DIRECT AND INDIRECT GREENHOUSE 
GAS EMISSIONS.—The term ‘direct and indirect 
greenhouse gas emissions’ includes, with respect 
to a covered issuer— 
‘‘(i) all direct greenhouse gas emissions 
released by the covered issuer; 
‘‘(ii) all indirect greenhouse gas emis-
sions with respect to electricity, heat, or 
steam purchased by the covered issuer; 
‘‘(iii) significant indirect emissions, 
other than the emissions described in clause 
(ii), emitted in the value chain of the cov-
ered issuer; and 
‘‘(iv) all indirect greenhouse gas emis-
sions that are attributable to assets owned 
or managed, including assets that are par-
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