U.S. Securities and Exchange Commission Acting Director Allison Herren Lee has launched a review of corporate climate-related financial disclosures and plans to update a decade-old guidance document as well, Lee announced Feb. 24.

Lee in a statement said she has directed the Division of Corporation Finance "to enhance its focus on climate-related disclosure in public company filings." Division staff will examine the extent to which public companies disclose climate change-related information in line with guidance released by President Barack Obama's administration in 2010. Staff will also assess companies' compliance with disclosure obligations under the federal securities laws, discuss these issues with public companies, and "absorb critical lessons on how the market is currently managing climate-related risks," Lee wrote.

Following the 2010 guidance, the SEC in 2016 asked for comments on disclosure practices, including whether it should require disclosure of sustainability matters such as climate change, resource scarcity, corporate social responsibility and good corporate citizenship. The initiative was not pursued further under the administration of President Donald Trump, despite calls from some investors to do so.

President Joe Biden has made climate change one of his top priorities. Biden also pledged during his campaign to require companies to disclose their climate risks and emissions.

The move also comes as investor interest in climate-related risks has increased in recent years.

"Now more than ever, investors are considering climate-related issues when making their investment decisions," Lee said. "It is our responsibility to ensure that they have access to material information when planning for their financial future."

"Ensuring compliance with the rules on the books and updating existing guidance are immediate steps the agency can take on the path to developing a more comprehensive framework that produces consistent, comparable, and reliable climate-related disclosures."

Biden's nomination of Gary Gensler to head the SEC is pending in the U.S. Senate. Gensler is an 18-year veteran of Goldman Sachs Group Inc. and the former head of the Commodity Futures Trading Commission. He was also involved in the creation of the Sarbanes-Oxley Act, the accounting framework American companies use to disclose their financials.

But Lee has not waited for Gensler's confirmation to align the agency with Biden's goals. In addition to now launching the climate disclosure review, Lee in early February created the position of senior policy adviser senior policy adviser on climate and environmental, social and governance issues and appointed Satyam Khanna, previously a staffer to ESG-friendly former SEC Commissioner Robert Jackson, to that position.