The Biden-Harris Administration has placed considerable emphasis on combating climate change and promoting sustainable practices. As a result, businesses and contractors working with the federal government must be prepared to adapt and comply with new climate regulations.
One such regulation is the proposed Federal Supplier Climate Risks and Resilience Rule, which aims to protect the federal government's supply chains from significant climate-related financial risks. In this article, we will provide an overview of the Rule, outline its requirements, and discuss the steps companies need to take to ensure compliance.
The Federal Supplier Climate Risks and Resilience Rule was proposed on November 10, 2022, as part of the Biden Administration's goal to achieve net-zero emissions procurement by 2050.
This Rule requires large federal government contractors to disclose their greenhouse gas (GHG) emissions, climate-related financial risks, and set science-based emissions reduction targets.
The Rule applies to federal contractors who receive the highest volumes of annual federal agency contract obligations. The regulation differentiates between two types of contractors:
Contractors that are not subject to the Rule include higher education institutions, non-profit research entities, and state or local governments.
As the US Federal Supplier Climate Risks and Resilience Rule moves closer to implementation, businesses and organisations should stay informed and prepare to adapt to the new requirements. Compliance with this Rule will not only reduce climate-related financial risks but also contribute to a more sustainable and resilient economy. Business leaders must proactively embrace these changes and lead their organisations toward a greener and more environmentally responsible future.
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