Stay Informed

In March 2022, the Securities and Exchange Commission (SEC) proposed a new rule titled “The Enhancement and Standardization of Climate-Related Disclosures for Investors.” The proposal would require public companies to report on “Scope 3” emissions, which are the result of activities from assets not owned or controlled by a publicly traded company but that contribute to its value chain.

This unprecedented Scope 3 disclosure rule would require public companies to report emissions data from farms and ranches of all sizes, said Brantley Seifers, Indiana Farm Bureau’s national affairs coordinator.

“The complexity of this rule will manifest throughout a publicly traded company’s value chain, burdening all agricultural producers, particularly small and mid-sized farm operations,” Seifers said. “Family farms don’t have teams of compliance officers and attorneys to respond to Wall Street. Higher costs could keep small farms from doing business with publicly traded companies, which could lead to more consolidation and fewer farmers at a time when the world is increasingly calling on rural America to meet the needs of hungry families.”

“This ruling would create an enormous burden on farms of all sizes,” said INFB President Randy Kron. “We strongly support the House and Senate efforts to curb the effects of ruling, which is a clear case of overreach by the SEC.”

Recently, both the House and Senate introduced the Protect Farmers from the SEC Act. This legislation would prohibit the SEC from requiring the disclosure of greenhouse gas emissions from upstream and downstream activities if those activities arise from a farm.

Additionally, the bill lays out precise definitions for what constitutes a farm, agricultural or horticultural commodities, upstream and downstream activities, and greenhouse gases.

The American Farm Bureau Federation, Indiana Farm Bureau, and several other agriculture organizations are backing the bill.

The House bill has received strong bipartisan support and was introduced with 100 original bill cosponsors, including Indiana Reps. Jim Baird, Larry Bucshon and Greg Pence. Additionally, Indiana Sen. Mike Braun is leading the bill in the Senate and hopes that the legislation will pressure the SEC to publish a final rule that excludes farmers and ranchers.

 “The SEC has proposed a climate disclosure rule that would add a significant regulatory burden on Hoosier farmers and ranchers at a time when family farms are already facing increased input costs, labor shortages and supply chain disruptions caused by bad policies in Washington,” Braun said. “I am proud to lead the Protect Farmers from the SEC Act to put a stop to this federal overreach by the Biden administration because the last thing we need is more red tape entangling our nation’s farmers. I appreciate the support from INFB as I continue to fight for Hoosier farmers in Congress.”

As the proposed SEC rule and legislation move forward, INFB will continue to work closely with legislators and ag partners to ensure farmers are exempt from this proposed regulation.