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

California’s climate disclosure landscape is entering a critical phase. With SB 253 moving forward and SB 261 temporarily paused but not overturned, companies operating in the state face a mix of active requirements and unresolved legal questions. The direction of travel is clear: regulators, investors, and supply-chain partners expect robust greenhouse gas reporting and climate-risk transparency. Preparing now—by completing your GHG inventory, conducting a TCFD-aligned risk assessment, and organizing data for assurance—ensures readiness for California’s rules and supports improved performance in widely used frameworks like CDP, EcoVadis, and CSRD. The FAQs below outline what the current rules mean and how organizations can respond confidently.

Yes. The Ninth Circuit temporarily enjoined enforcement of SB 261 while the court reviews the case. This is not a ruling on the constitutionality of the law; it simply prevents enforcement until oral arguments, scheduled for Jan. 9, 2026. SB 253 is not part of the injunction and remains active.

No. The temporary pause on SB 261 enforcement does not change the overall direction. CARB is still moving ahead with rulemaking, and SB 253 remains active. Completing your greenhouse gas (GHG) inventory and climate-risk assessment now is the most efficient path. This work satisfies multiple programs at once, including CDP, EcoVadis, and California’s disclosure requirements. If SB 261 resumes in January, you will be ready. If timelines shift, you still meet global best practice and strengthen credibility with customers, investors, and regulators.

Yes. Analysts note SB 261 mirrors global trends like the EU CSRD. Investors, regulators, and supply-chain partners expect climate-risk transparency regardless of U.S. litigation. Completing the work now improves ESG ratings and reduces future compliance risk.

The Ninth Circuit will hear oral arguments in January 2026. CARB staff said they are reviewing the injunction and may issue new guidance, though nothing has changed yet. The U.S. Chamber’s emergency appeal to the Supreme Court was withdrawn, leaving the case entirely with the Ninth Circuit for now.

Climate-risk assessment has ongoing value beyond California law. Benefits include:

  • Higher scores with voluntary programs like CDP and EcoVadis

  • Compliance with CSRD’s double materiality assessment

  • Clear demonstration that climate risk is integrated into governance, strategy, and financial disclosures

The work aligns with global expectations and supports multiple regulatory frameworks.

CARB explicitly excludes “entities in the business of insurance” from SB 261. CARB is proposing to exempt: nonprofit organizations; entities that are purely governmental; companies whose only presence in California consists of remote (teleworking) employees; and California independent system operator (CAISO) or entities whose only activity in California is wholesale electricity trading (interstate commerce). It is important to note that these exemptions are currently proposed in CARB rulemaking. Until final regulations are adopted, there may be further changes or clarifications.

CARB’s SB 261 checklist follows TCFD (2017) and IFRS S2. Companies may report through existing frameworks used for exchanges or other regulators. CARB also allows disclosure of limitations or gaps if your capabilities are still maturing.

Yes. The Ninth Circuit did not enjoin SB 253. CARB continues rulemaking, and first-year GHG reporting remains required in 2026 for companies with more than $1 billion in revenue doing business in California.

CARB announced a one-time extension for the first year:

  • Scope 1 and 2 reports: Due Aug. 10, 2026

  • Future years: Statutory deadlines tighten after 2026

Applicable fiscal-year data depends on your fiscal year end (FY25 vs. FY26).

Starting limited assurance early helps identify data gaps and eases future audits.

  • 2026: Limited assurance for Scope 1 and 2 is optional

  • 2027 and beyond: Limited assurance is mandatory for Scope 1 and 2

  • From 2027 forward: Scope 3 reporting and assurance requirements begin

No. The official template is optional. Companies may submit their existing GHG reports. Those that were “not collecting data” may file a non-collection letter for 2026, but they must submit a full Scope 1–3 inventory with assurance in 2027.

This is considered a last resort. Skipping 2026 creates a significantly heavier lift in 2027. CARB’s current flexibility may not last, and beginning data collection now shows good-faith compliance as expectations tighten.

The most effective strategy is to stay on track. Completing your GHG inventory, conducting your climate-risk assessment, and aligning with TCFD and ISSB standards serve multiple purposes:

  • Readiness for SB 253 and a potential SB 261 snap-back

  • Higher ESG ratings (CDP, EcoVadis)

  • Alignment with global reporting systems like CSRD

  • Stronger credibility with investors and supply-chain partners

Regardless of court outcomes, these steps reflect global norms for climate transparency.

Preparing your climate disclosures now remains the most strategic move, regardless of how the legal landscape evolves. Doing so puts your company ahead if SB 253 and SB 261 proceed on schedule, and better positioned even if timelines shift. Investor expectations, customer requirements, and global reporting frameworks continue to move in the same direction. Taking action today strengthens your credibility, reduces future compliance risk, and ensures you’re ready for whatever comes next.

|

More resources from Greenplaces