News from California – Governor Newsom signed SB219, modifying the state’s recent climate disclosure laws (SB253 – the Climate Corporate Data Accountability Act – and SB261 – Climate-Related Financial Risk Reporting). These amendments are more administrative than substantive.
Major elements of the amendments include:
- The state board has until July 1, 2025 to adopt regulations implementing SB253. This is a mere 6 month extension from the original January 1, 2025 deadline and the original dates for company reporting remain intact (2026 or by a date to be determined by the state board, for Scopes 1 and 2, and 2027 for Scope 3) as did the dates for assurance (limited assurance for scopes 1 and 2 starting 2026). The annual disclosures can be made to either the emissions reporting organization or the state board, and scope 3 emissions are to be reported on a schedule specified by the state board, rather than no later than 180 days after its scope 1 emissions and scope 2 emissions are publicly disclosed.
- Climate-related financial risk reporting (SB261) is still required on or before January 1, 2026, and biennially thereafter.
- Reports under both laws may be consolidated at the parent company level and the annual fee is no longer required to be paid upon filing the disclosure.
- The amendments authorize, rather than require, the state board to contract with an emissions reporting organization under both SB253 and SB261 to develop a reporting program to receive and make required disclosures publicly available and carry out duties that the state board deems appropriate.
Of course, the original laws are still being challenged in court. These amendments are unlikely to alter the trajectory of the court challenges since they don’t address the issues at the heart of the case. Plaintiffs argue the laws compel non-commercial speech in violation of the First Amendment, are precluded by the Clean Air Act, and run afoul of the Dormant Commerce Clause. That litigation is ongoing and we will provide updates as it develops.
Our members can learn more about climate risk management and disclosures here.
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