What the SEC’s New Climate Transparency Rules Mean for You


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Discussing sensitive topics can be challenging for business owners. This is one of the top three or four reasons I receive initial calls for public relations assistance addressing a hot-button issue. The latest confusing trend is sustainability and how to talk about it openly. Surprisingly, people need clarification about how much to talk about it, why it’s important and when to bring it up. There’s even a new word for this fear: “greenhushing.”

The most recent bit of pressure on companies regarding eco-messaging is the U.S. Securities and Exchange Commission’s (SEC) recent efforts to enforce regulations that protect investors and maintain market integrity. Basically, the SEC has revised environmental transparency rules and introduced mandatory climate risk disclosures for public companies.

This is the first time a sustainability mandate has emerged nationally, and it’s expected to have a notable impact. In my opinion, even for private companies, it’s a call to pay attention and stop neglecting this discussion.

We are entering an era where climate objectives, targets and governance frameworks will become mandatory in corporate reporting. This shift also aligns with the increasing consumer demand for environmentally and ethically sustainable products — a trend that, despite its popularity, has seen many companies struggle to translate into tangible demand.

Related: Sustainability for Entrepreneurs — Why It Matters (and How to Achieve It).

The paradox of consumer demand and greenwashing

Consumers’ enthusiasm for sustainable products often starkly contrasts with their actual purchasing behavior. While surveys indicate a robust desire for sustainability, sales frequently need to catch up to expectations for new, environmentally conscious products. This discrepancy is exacerbated by greenwashing — where claims of environmental stewardship are not backed by practice — further eroding consumer trust and complicating the landscape for genuine initiatives.

I’d counsel any company today to prepare for sustainability discussions and engagement. It is now an unavoidable topic. Because I have been a fractional CMO and external public relations consultant since 2002, I’ve received many calls from companies facing these watershed moments. Here is the advice I’d give a leadership team aiming to be more vocal about sustainability.

The imperative of transparency

In this context, the necessity for transparency is undeniable. Beyond mere regulatory compliance, transparency is crucial for cultivating consumer trust and loyalty. Companies must now proactively measure and refine their approaches to climate change, so this journey has got to start with a comprehensive understanding of your environmental footprint, including greenhouse gas emissions, resource utilization and waste generation.

Typically facilitated by external consultants or an internal sustainability team, this foundational assessment is critical for setting realistic sustainability goals and improvement strategies. Employing standardized tools and frameworks like the Greenhouse Gas Protocol and Life Cycle Assessment provides a methodical approach to this task and will result in data and benchmarks you can use consistently in your messaging efforts.

Armed with this data, specific and time-bound goals can be set that meet compliance requirements (if necessary) and drive significant environmental and social improvements. Engaging stakeholders, particularly employees, at this stage, helps bring to the surface any practical concerns and integrate these insights into the goal-setting process.

Related: 70% of Consumers Say They’ll Buy ‘Green’ Products, but Only 5% Actually Do. That’s Due to a Common Marketing Mistake By Eco-Friendly Brands.

The role of public relations in implementation

Public relations in the realm of sustainable messaging goes beyond just issuing press releases. PR is a strategic tool for amplifying and embedding climate-change initiatives into the corporate ethos. Compelling storytelling highlighting a company’s progress and impacts on sustainability can significantly boost its reputation and foster third-party credibility.

Leveraging various channels — from press releases and social media to comprehensive sustainability reports — enables these stories to reach and resonate with a broad audience, sparking engagement and advancing the sustainability agenda.

Cultivating a sustainability-centric culture internally is essential. Companies can ensure that sustainability principles are deeply ingrained in every aspect of their operation through regular educational programs, active participation in sustainability initiatives and acknowledgment of individual and team contributions. This not only reinforces the company’s commitment to sustainability among employees but also mobilizes them and other stakeholders as ambassadors of these values.

Continuous monitoring and evaluation of sustainability initiatives and how they are being perceived in public are vital measurement points to consider when assessing progress. Like any meaningful initiative, setting and tracking key performance indicators (KPIs) allow companies to measure effectiveness and identify areas for improvement. Further, engaging with employees and stakeholders through feedback will enrich this process and provide real-world insights.

It seems counterintuitive, but in my experience, challenge is often in partnership with opportunity. Tackling tough subjects can uncover opportunities for innovation, stakeholder engagement and corporate accountability that otherwise would’ve been dormant. Talking specifically about sustainability is not always about compliance. It is a chance to appeal to buyers and lead the market with integrity, innovation and vision.

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