Updates to California climate disclosure laws

California climate disclosure regulations continue to evolve. For the most up-to-date compliance information, please visit this page.

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California’s complementary climate disclosure laws — SB 253 (the Climate Corporate Data Accountability Act) and SB 261 (the Climate-Related Financial Risk Act) — remain at the center of national attention after a major legal development and new regulatory updates this week.

The Ninth Circuit Court of Appeals issued an order temporarily enjoining enforcement of SB 261, while allowing SB 253 to move forward. At nearly the same moment, the California Air Resources Board (CARB) convened a public workshop outlining new implementation details for both programs — including a proposed August 10, 2026 reporting deadline for SB 253 and key clarifications on definitions, exemptions, and assurance.

The bottom line: the litigation introduces short-term uncertainty, but CARB’s policy direction remains on course.

Legal update: Ninth Circuit pauses SB 261, keeps SB 253 in force

On November 18, 2025, the Ninth Circuit granted the U.S. Chamber of Commerce’s motion for an injunction pending appeal in Chamber of Commerce v. Randolf, temporarily halting enforcement of SB 261 while the court reviews the case on its merits.

The injunction does not apply to SB 253, meaning the greenhouse-gas emissions reporting law remains active and its rulemaking continues with the final rule set to be approved in Q1 2026..

Key facts

• Scope of injunction: applies only to SB 261 and only for the duration of the appeal.
• Next step: oral arguments are scheduled for January 9, 2026 in San Francisco.
• Background: the Chamber’s suit challenges both statutes on First Amendment grounds, arguing that mandatory climate disclosures amount to compelled speech. Claims under the Supremacy Clause and Dormant Commerce Clause were previously dismissed.

What legal analysts are saying

Ropes & Gray noted that the injunction “gives the Court of Appeals breathing room to consider the appeal without potentially prejudicing reporting companies,” emphasizing that it is procedural rather than substantive.

Covington & Burling explained that the Ninth Circuit’s order likely reflects “a strategic move to avoid Supreme Court intervention” after the Chamber’s November 10 emergency application to the Court. By granting temporary relief on SB 261, the Ninth Circuit removed the urgency that could have triggered Supreme Court review.

Covington also highlighted the key legal distinction at issue:

• SB 253 (emissions = facts): requires objective, verifiable data subject to lower First Amendment scrutiny.
• SB 261 (climate risk = opinions): compels forward-looking scenario analysis that may be viewed as subjective, subject to higher scrutiny.

Davis Wright Tremaine added that the injunction currently applies to the Chamber and its member organizations; its broader applicability will depend on further guidance from CARB or the court.

Law360 summarized the effect as “a pause, not a pivot,” noting that the case remains live and that companies could face reinstated obligations shortly after the January hearing.

CARB workshop highlights: SB 253 and SB 261 implementation

Even as the injunction was announced, CARB proceeded with its November 18 public workshop, providing new detail on the mechanics of both programs

SB 253: Greenhouse Gas Reporting

• One-time extension: CARB proposed a first-year filing deadline of August 10, 2026 for Scope 1 and 2 emissions.
• Fiscal-year rule: companies with FY endings between Jan 1 – Feb 1 must report FY 2026 data; those ending later in 2026 must report FY 2025. Each filer will have six months after its fiscal year end to submit.
• Assurance: optional for 2026 but required (limited assurance) for Scopes 1 and 2 starting 2027; Scope 3 and assurance both begin in 2027 and beyond.
• Template optionality: companies may use existing GHG reports; the CARB template is not mandatory.
• “Non-collection” letters: entities that did not collect data in 2025 must submit a statement in lieu of a 2026 report, but must produce a full Scope 1-3 inventory with assurance in 2027.
• Exemptions: non-profits, government bodies, telework-only entities, and regulated insurers are currently excluded.
• Revenue and nexus: applicability tied to California Franchise Tax Board filings — total revenue from Form 100/100S/565/568 and “doing business” defined under RTC § 23101.

SB 261: Climate-Related Financial Risk Disclosure

• Statutory deadline: remains January 1, 2026, with links due to CARB’s docket by July 1, 2026, and administrative fees invoiced September 10, 2026.
• Framework alignment: companies may report using TCFD (2017), IFRS S2, or another government-mandated framework.
• Disclosure flexibility: entities in early stages may describe gaps, limitations, and plans to expand future reporting.
• CARB message: the rulemaking process and enforcement planning continue despite the injunction.

Perspectives from law firms and ESG leaders

Ropes & Gray advises that “companies should finish up work already in progress or at least get it to a place that is organized and easy to pick back up.” They encouraged companies to continue climate-risk assessments, emphasizing that “the injunction is temporary and not a signal of the court’s ultimate decision.”

Covington characterizes SB 261 as “a pure First Amendment case on shaky footing,” but emphasizes that good-faith efforts under SB 253 demonstrate compliance readiness.

Davis Wright Tremaine stresses that the injunction’s breadth is “somewhat unclear” and that “reporting entities need to continue to prepare for SB 253 compliance — and possibly SB 261 depending on how the Ninth Circuit decides to apply the stay.”

Mintz noted the ruling “preserves the status quo until the Ninth Circuit can evaluate whether California’s disclosure regime passes legal muster,” effectively reducing near-term risk but not eliminating it.

Implications for companies

The pause on SB 261 changes timing, not direction. CARB’s rulemaking shows clear momentum toward implementation, and SB 253 remains active. Companies that maintain progress on GHG inventories and climate-risk disclosures will be best positioned regardless of legal outcomes.

Recommended actions:

• Continue preparing SB 261-aligned reports; the injunction may lift quickly after the January hearing.
• Complete SB 253 inventories early (Q1 2026) to avoid compressed cycles later.
• Initiate limited assurance for Scopes 1 and 2 in 2026 to de-risk the 2027 requirement.
• Evaluate fiscal-year alignment now to determine which data year applies.
• Monitor CARB’s definitions and forthcoming fee regulations.

Looking ahead

Oral arguments before the Ninth Circuit are set for January 9, 2026. CARB will continue rulemaking into early 2026,  including hearings on the initial SB 253 regulations,  and expects to finalize fee structures and public dockets shortly thereafter.

As Ropes & Gray concluded, this is “a moment to stay engaged, not to stand down.” Companies that treat the pause as an opportunity to refine their data, assurance, and governance systems will be better prepared for compliance and for the broader market shift toward transparent climate disclosure.

Author’s note: This update is provided for informational purposes only and should not be construed as legal advice. Readers should consult counsel to determine how these developments affect their specific compliance obligations.