Legal experts say the SEC requires that companies disclose the risks of climate change to their business operations but that the agency has taken almost no action to enforce it. The moves by California and New York are seen as a step to fill that void.
Exxon Mobil already has received a subpoena for documents dating from 1977 from the office of Eric Schneiderman, New York’s attorney general. Schneiderman has at his disposal New York’s Martin Act, a law that gives the state’s attorney general broad power to prosecute companies for financial fraud.
Unlike federal securities law, the New York statute does not require the state to prove that a company intended to defraud — only that it misrepresented relevant information or withheld it from investors. The law applies to any company doing business in the state.