Tailored for a financial, sustainability or audit course, this case has students explore the SEC’s Climate-Related Disclosure rule, which provides companies guidance around how to disclose climate-related risks that are reasonably likely to have a material impact on a company’s strategy, results of operations or financial position.

The three-part case is structured to build upon the students’ knowledge.

• Part 1: Climate-related events. Students are introduced to the rule, including the definition of and different types of climate-related risks. They are provided with and asked to read background information on the 2023 Maui wildfires, as well as excepts from the SEC’s rule. Students are placed in the role of the director of financial reporting for a fictitious resort company with locations in Maui. Based the students’ reading, they are asked to determine if the rule applies.
• Part 2: Disclosure of client-related metrics. Students dig more deeply into the rule’s disclosure requirements and threshold. They will complete a series of calculations to determine the required disclosure.
• Part 3: Impact on investment decisions. After completing Parts 1 and 2 of the case, students are asked in Part 3 to take on the role of an investor. They reflect on Parts 1 and 2 to consider if the rule’s required disclosures would impact their decision to invest in the fictitious company or not.

This case can be taught several ways and is designed for either individual or group completion. You could have groups work together on Parts 1 and 2 and have students submit an individual response for Part 3.

Suitable courses: Sustainability, Financial, Audit

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