Extensive Climate Disclosure Requirements Proposed for Federal Contractors
On November 10, 2022, the Federal Acquisition Regulatory Council, composed of the Department of Defense, the General Services Administration, the National Aeronautics and Space Administration, and chaired by the Office of Federal Procurement Policy in the Office of Management and Budget, issued a proposed rule that would require certain federal contractors to disclose climate-related information to the System for Award Management (SAM) and, in certain instances, make such information publicly available on its website. The proposed rules would require disclosure concerning climate-related risks in accordance with the recommendations of the Task Force on Climate-related Disclosure (TCFD), a greenhouse gas emissions inventory that would include Scopes 1, 2, and 3 emissions and the setting and validation of science-based (climate) targets. If adopted, the rules would present substantial new disclosure responsibilities for reporting contractors. The proposed rule would also indirectly compel reporting contractors to have monitoring, accounting, planning, and climate risk oversight practices in place to enable them to satisfy the proposed disclosure requirements.
For more information on the Biden Administration proposal, read our detailed Sidley Update here.