Type: Climate Disclosure
Status: SB 253 and SB 261 Enacted into Law.
SB 253: Climate Corporate Data Accountability Act:
- Requires companies with more than $1 billion in annual revenue to report greenhouse gas emissions.
- Must report Scope 1 and 2 emissions by 2026.
- Must report scope 3 by 2027
- The reporting rules and system are currently being drafted by The California Air Resources Board.
- Penalties for non-compliance are not to exceed $500,000.
SB 261: Greenhouse gases: climate-related financial risk
- Requires companies with more than $500m in annual revenue to biannually prepare and disclose a climate-related financial risk report.
- Beginning Jan. 1, 2026, and once every two years afterwards, companies must publish on their websites a climate-related financial risk report.
- Non-compliance would not exceed $50,000.
- These new laws are similar to what the SEC is discussing around financial climate risk reporting rules.
- How the commissions set up rules and reporting systems will be important to how companies comply with the complexity of measuring company impacts.
- Companies should begin to map and measure their impacts now as best they can so it is easier to comply when the rules are published.