WASHINGTON – A proposed rule from the US Securities and Exchange Commission inspired the International Dairy Foods Association to submit comments in response, conveying the IDFA’s suspicion that the rule would prevent entry to the dairy industry and prove difficult to navigate for dairy companies.
The IDFA refrained from taking a position on the SEC’s proposed rule, “The Enhancement and Standardization of Climate-Related Disclosures for Investors,” but stated the SEC didn’t account for the financial and market burdens the rule would put on businesses, especially smaller dairy processors, given proposed timelines and climate reporting detailed in the rule.
Within its submitted comments, the IDFA pointed out how the proposed rule would make it difficult for the dairy industry to comply with certain potential regulatory requirements. The comments noted the proposal’s lack of engagement with the dairy value chain, as well as a lack of analysis on the effects proposed measures would have on small entities.
The IDFA detailed its view that the SEC failed to recognize that not only small, but also some medium-sized businesses, lack the technical expertise and financial resources to measure and report green house gas emissions.
Additionally, the IDFA commented that the rule adds additional GHG reporting schemes instead of reconciling what’s already in place. And the IDFA requested additional compliance time and greater flexibility for companies reporting Scope 3 GHG emissions.
“The US dairy industry has committed significant resources to achieve ambitious environmental stewardship goals, including GHG neutrality, optimized water use, and improved water quality by 2050,” said IDFA President and chief executive officer Michael Dykes, DVM. “Should the SEC move forward with the Climate Disclosure Rule, it is critical that the SEC build in additional time for companies to comply while extending the Scope 3 safe harbor period. As currently written, the rule threatens to become overly onerous and put significant financial burdens on millions of companies and businesses that fall outside of the SEC’s regulatory jurisdiction. IDFA encourages the SEC to engage food and agriculture to learn more about how our businesses and employees are working each day to deliver nutritious, affordable, sustainable dairy nutrition to people everywhere.”
With its comment letter, the IDFA stated it wanted to inform the SEC about the dairy products marketplace, the leadership of the industry and dairy’s commitments, successes and challenges in reducing individual and collective GHG footprints.