CNX Submits Comment Letter to SEC on Proposed Climate Rules

Source: 6/16/2022, Location: North America

In a letter to the U.S. Securities and Exchange Commission (SEC), CNX Resources Corporation offers insights to the agency on behalf of the company's stakeholders. As a leader in corporate responsibility – focused on delivering tangible, impactful, and local benefits to the company's stakeholders – CNX comments on the proposed rule's practical application as it relates to accurate, transparent, and consistent measures as well as potential unintended consequences that could negatively impact confidence in the capital markets. The company's written response reflects the following three themes to ensure the proposal is consistent with the Commission's mission in providing standardized, transparent disclosures to investors:

"First, the proposed climate rules create inconsistent and highly subjective standards for reporting Scopes 1, 2, and 3 carbon dioxide emissions across different industries and companies. This in turn may create confusion and misinformation when investors assume the emissions data reported by each registrant were developed from the same methodology, scope, and assumptions. Although CNX fully supports the SEC's important mission and places the highest priority on regulatory compliance, the draft rule represents a departure from the Commission's goal of promoting fair, transparent, and well-understood accounting principles that ensure comparable and decision-useful outcomes," said Alan Shepard, CNX Chief Financial Officer.

CNX Chief Excellence Office Yemi Akinkugbe commented, "Second, the proposed climate rules are attempting to morph an ambiguous voluntary reporting framework into an involuntary compliance framework without first addressing the necessary standardization to ensure a consistent, accurate, and transparent level playing field across public companies and the capital markets. Capital could end up being mis-allocated as a result. Although CNX recently established a Regulatory Reporting Group and has committed to reporting emissions data on a quarterly basis, not everyone is as far along in this process. Appropriate standardization of climate-related disclosures should be in place to ensure capital allocation decisions are made with accurate, transparent, and consistent data when it comes to cumulative lifecycle emissions."

"Third and last, getting this issue right requires rules that are accurate, transparent, and consistent across industries and companies. The CNX New Technologies effort is focused on how best to utilize existing company assets and proprietary technology to drive results in methane abatement and other similar carbon capture opportunities. The domestic natural gas industry, the Appalachian basin, and CNX in particular, are strategically positioned to provide solutions and economically benefit in a lower carbon macro environment if these proposed rules are applied uniformly," concluded CNX President of New Technologies Ravi Srivastava.

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