Climate change has been a major and well publicized part of the SEC’s agenda in the last year. As you can read on the climate change section of the SEC’s webpage, CorpFin focused on climate change in the review process, the Enforcement Division formed a climate change task force, and the Commission issued an Invitation to Comment on climate change related matters.
CorpFin comment letters have addressed climate change. On September 22, 2021, the staff issued this sample letter to companies providing examples of the types of comments it is issuing.
A recent comment letter to CarMax Auto Funding LLC regarding a registration statement disclosure provides an example of a climate change comment:
Risk Factors, page 38
- To the extent that you believe investors in these asset-backed securities may be impacted by climate related events, including, but not limited to, existing or pending legislation or regulation that relates to climate change, please consider revising your disclosure to describe these risks. See the Commission’s Guidance Regarding Disclosure Related to Climate Change, Interpretive Release No. 33-9106 (February 8, 2010).
The Interpretive Release mentioned in this comment, also known as FR 82, can be found here.
The company responded to this comment with modified risk factor disclosure. You can find the modified risk factor and an example of a risk factor summary in the registration statement.
As always, your thoughts and comments are welcome.