Anyone who doubts the depth of Trump-era antipathy toward climate-related disclosure might check out the keynote address delivered by SEC Chair Paul Atkins at the Inaugural OECD Roundtable on Global Financial Markets. Here’s an extract:

• As we look with fresh eyes at the types of foreign issuers that receive special accommodations, we should also not lose sight of the bedrock beneath any effective regulatory regime: high-quality accounting standards and financial materiality.
• With respect to accounting standards, U.S. companies must prepare their financial statements in accordance with U.S. GAAP, or Generally Accepted Accounting Principles. During my previous tenure at the SEC as a Commissioner in 2007, I voted to support rule changes to permit foreign companies to present financial statements prepared in accordance with the International Financial Reporting Standards (IFRS), as issued by the International Accounting Standards Board (IASB), without reconciliation to U.S. GAAP.
• When the SEC eliminated the reconciliation requirement, it noted that “the IASB’s sustainability, governance and continued operation in a stand-alone manner as a standard setter are significant considerations in [eliminating the reconciliation requirement], as those factors relate to the ability of the IASB to continue to develop high-quality globally accepted standards.” The SEC specifically noted the ability of the IASC Foundation, which was the predecessor to the IFRS Foundation, to obtain “stable funding” for the IASB.
• In 2021, the IFRS Foundation announced the formation of the International Sustainability Standards Board (ISSB), and its Trustees are now responsible for securing funding for both the IASB and the ISSB. This recent expansion of the IFRS Foundation’s remit cannot divert its focus from its long-standing core responsibility of funding the IASB. In turn, the IASB must promote high-quality accounting standards that are focused solely on driving reliable financial reporting and are not used as a backdoor to achieve political or social agendas. Reliable financial reporting is critical to supporting capital allocation decisions. We all have a strong interest in the IASB’s being fully funded and operational, and I encourage the IFRS Foundation to meet its goal for “stable funding” that prioritizes the IASB and its focus on standards for financial accounting, rather than specious and speculative issues.
• If the IASB does not receive full, stable funding, then one of the underlying premises for the SEC’s elimination of the reconciliation requirement for foreign companies in 2007 may no longer be valid, and we may need to engage in a retrospective review of that decision.

Atkins then goes on to take shots at the “double materiality” regulatory approach promoted under recently passed EU laws:

• I have significant concerns with the prescriptive nature of these laws and their burdens on U.S. companies, the costs of which are potentially passed on to American investors and customers. While I am encouraged by the EU’s recent commitment to ensure that these laws do not pose undue restrictions on transatlantic trade, as well as efforts to streamline and simplify these laws, further work remains to refocus regulatory regimes on the principle of financial, instead of double, materiality. Indeed, as Europe seeks to promote its capital markets by attracting more companies and investment, it should focus on reducing unnecessary reporting burdens on issuers rather than pursuing ends that are unrelated to the economic success of companies and to the well-being of their shareholders.

Bloomberg provided the following context:

• The IFRS Foundation said in an emailed statement Wednesday that it was halfway through a two-year program to develop a long-term funding strategy and increase efficiency.
• It also said that the accounting and sustainability boards were funded separately and “their respective standards do not impose requirements on each other.”
• The foundation launched a cost-cutting and fundraising drive after losing £2 million ($2.7 million) in 2024. The sustainability board relies heavily on seed funding from its three global headquarters in Germany, Canada and China, with some of the agreements ending next year.
• Other than that the foundation relies on voluntary contributions from governments and companies including large accounting firms, raising fears that funders could influence standard setting.
• In contrast, the US Financial Accounting Standards Board receives dedicated funding through fees on listed companies—support set out in federal law. But the Republican-led Congress has threatened the board’s budget over new income tax disclosure rules.

Atkins ends his remarks by expressing confidence that “international cooperation in the regulatory matters I have discussed will benefit all of us in the long run, across the United States and around the globe.” But, in the modern-day manner, this only seems true if “international cooperation” means surrender to Trumpian irrationality. As the IFRS Foundation’s statement above implies, it’s not very believable that Atkins’ concerns are truly about funding; rather, they’re rooted in visceral hatred of the ISSB and its doings, regardless that its standards will likely never be imposed on US issuers (nor, most likely, on Canadian ones). Only time will tell whether preserving the current accommodation, rather than pointlessly rewinding the clock to the cumbersome and expensive regime of mandatory US GAAP reconciliations, will come at the cost of winding up or at least deemphasizing the ISSB, and whether the IFRS Foundation and its constituents would consider that too great a price to pay. Or, no less likely, whether the SEC will rewind (and then smash) the clock regardless of what anyone else does, because that’s just what the Trumpian ethos demands. Fresh eyes indeed!

The opinions expressed are solely those of the author.