There have been several debates since the SEC climate risk disclosure requirement was revealed, during which pundits and corporate decision makers argued about the impact of the findings. It was noted that the key words "interpretive guidance" had been used prominently within the body and the executives were not sure whether they should pay attention to these words in particular or the more significant word also used, "materiality."

Quite rightly, the Securities and Exchange Commission points out that it is not within its jurisdiction to weigh in on climate change issues; whether or not we cause, indirectly or otherwise, damage to the environment. Rather, the SEC climate risk disclosure finding seeks to prompt corporate executives to reveal the company's position in the debate. As climate change legislation is of significant interest to us, it is only right that companies fully address any potential implications.

There has been much debate on either side of the fence, but there is no doubt that the SEC has significant impact in the world of finance and great bearing on corporate America. Public confidence in the regulation of companies financially would be affected and there would be far less oversight if it where not for the SEC. Confidence in the stock exchange could be impacted.

Now, all company chiefs must consider climate risk as they prepare to submit their annual filings to the SEC. Information and notes contained within reports are often scrutinized by investors. The SEC climate risk disclosure may not have altered the actual rule of law, but big business nevertheless must consider the implications from every perspective.

Climate change issues can indeed be polarizing and invoke strong emotions. Change is expected from big business and according to the SEC, climate risk is an integral consideration and corporate chiefs simply must be fully aware of potential repercussions.

When a company does not disclose material elements that could significantly affect its operations, it could be seen to be out of step with federal positions even though the guidance issued was "interpretive." We could argue all day along that this could be seen as a grey area, but remember that public opinion tends to be more polarized and will make far-reaching decisions about a company that is seen to be somewhat backward.

Quarterly and annual reports contain important analysis and management discussion pertaining to publicly traded companies. The information necessary for investors to make an informed decision is contained here and reports must be well put together and presented so that the organization may be sure that it attracts the money that is, after all, the lifeblood of its organization.

Pressure groups and investor watchdogs alike will be looking at the next batch of public company reports with a keen eye as they observe whether the SEC climate risk findings have been taken to heart by company chiefs.