Note: this policy is scored under InfluenceMap’s “Climate Finance” workstream, which tracks engagement on climate-related financial policy in addition to “real economy” climate change policies. This is distinct from other policies tracked on the InfluenceMap US platform. As such, the “Entities Engaged on Policy” tab draws from a different universe than the companies and industry groups assessed under the LobbyMap platform.
The California Climate Disclosure Laws, signed into law October 2023, are intended to improve climate disclosure practices for large public and private entities operating in the state of California. SB 253 and SB 261 will require companies to disclose their greenhouse gas (GHG) emissions and climate-related financial risks, respectively.
SB 253, the Climate Corporate Data Accountability Act (as amended by SB 219), requires companies ‘doing business’ in California with annual revenue greater than $1 billion to report Scope 1, Scope 2 and Scope 3 emissions in accordance with the GHG protocol.
SB 261, the Climate-Related Financial Risk Act, requires companies doing business in California to report on their climate-related financial risk. The annual revenue threshold for SB 261 is $500 million, thus impacting more companies than SB 253. A company falling within the scope of SB 261 is required to disclose: (i) its climate-related financial risk in accordance with the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD) and (ii) measures it has adopted to reduce and adapt to the climate-related risks disclosed. These disclosures must be made publicly available on the company website.
The California Air Resources Board (CARB) is responsible for the implementation of SB 261 and SB 253 and is required to adopt the regulations by the deadline of 1st July 2025 (delayed six months from the initial deadline). The start date of the reporting requirements is to be determined by CARB. Scope 1 and Scope 2 GHG emissions reporting requirements are due to come into place in 2026. Scope 3 reporting requirements are expected to be implemented at a later date.
CARB, in December 2024, indicated that it will "exercise its enforcement discretion" for SB 253 for the initial reporting cycle. California lawmakers, however, have described this as "unacceptable" and have stated that they are "beyond frustrated at CARB’s lack of progress". CARB is currently seeking information until 21 March 2025, in order to inform its implementation of the disclosure regulations.
CARB held a consultation between December 2024 to March 2025, to assist in its implementation of the legislation. It sought feedback on the definition of companies to be included in the legislation, alignment with disclosure standards and methodologies and implementation timelines. The consultation received 243 responses, with positions ranging from oppositional to strongly supportive.
Given that the SEC has ended its defense of its climate disclosure rules, as of 27 March 2025, it is likely that there will be an increased focus on the California laws.
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In a motion filed 21 April, the US Chamber of Commerce and the California Chamber of Commerce supported an application for an injunction against the implementation of the California climate disclosure laws SB 253 and SB 261. The chambers' attorneys argued that the laws are unlawful and if enforced, will cause "irreparable injury."
The American Property Casualty Insurance Association (APCIA) and the American Bankers Association (ABA) responded to the California Air Resources Board's March 2025 consultation on the implementation of California's GHG emissions and climate risk disclosure regulations. While both groups generally supported the legislation, ABA advocated for exemptions for certain financed emissions while APCIA emphasized the cost of compliance.
The California Public Employees Retirement System (CalPERS) and California State Teachers Retirement System (CalSTRS) supported the California GHG emissions and climate risk disclosure regulations in 20 March and 21 March memos in response to the California Air Resources Board's March 2025 consultation on the implementation of the legislation. Both groups supported a broad definition of companies to be included within the scope of the legislation and advocated for an ambitious disclosure framework.
The Securities Industry and Financial Markets Association (SIFMA), Bank Policy Institute (BPI) and Investment Company Institute (ICI) appeared to not support the California GHG emissions and climate risk disclosure regulations. In response to the California Air Resources Board's March 2025 consultation on the implementation of the legislation, the groups advocated for a narrower definition of companies to be included within the scope of legislation and increased flexibility. SIFMA also supported a longer timeline before the rules are implemented.
According to a 15th March floor analysis from the California Senate Committee on Environmental Quality, the Securities Industry and Financial Markets Association has registered in opposition to SB 261, a bill that would mandate corporate disclosure of climate-related financial risk.
On August 17th, financial industry associations including the American Bankers Association, the Bank Policy Institute, and the Securities Industry and Financial Markets Association sent a joint letter to the California State Assembly outlining their opposition to SB 260, the Climate Corporate Accountability Act. The associations urged lawmakers to halt the bill, which would require companies doing business in California to disclose Scopes 1, 2, and 3 greenhouse gas emissions.
In an August 2 Politico newsletter, a spokesman for the American Bankers Association (ABA) expressed concern with California SB 260, a bill that would require companies to disclose greenhouse gas emissions including Scope 3 emissions. The bill is scheduled for a hearing in the California Assembly Appropriations Committee on Wednesday, August 3.
In a May 26th joint letter to the California Assembly Natural Resources Committee, industry associations including the American Bankers Association, the American Council of Life Insurers, the American Property Casualty Insurance Association, and the National Association of Mutual Insurance Companies stated opposition to California Senate Bill 260, the Climate Corporate Accountability Act. The bill would require businesses to disclose Scope 1, 2, and 3 greenhouse gas emissions and ensure these disclosures have been verified by an independent auditor.
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