Insights · California SB 253 · 22 min read

November 2025 CARB update: SB 253 & SB 261 FAQs

By Greenplaces Team · November 20, 2025

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 The U.S. Chamber’s emergency appeal to the Supreme Court was withdrawn, leaving the case entirely with the Ninth Circuit for now.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.

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[Merged from #29] CARB's Aug 21 workshop: what's new for SB 253 & SB 261

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

On August 21, the California Air Resources Board (CARB) held a three-hour workshop to review staff concepts and next steps for SB 253, SB 261, and SB 219. Here’s a summary of what CARB clarified, what’s proposed, what remains open, and what companies should do now.

Key timeline checkpoints (proposed or confirmed)

  • Public comment (staff concepts): August 21, September 11, 2025

  • Notice of Proposed Rulemaking (fee regulation): October 14, 2025

  • 45-day APA comment period: October 17, November 30, 2025

  • CARB Board hearing (fee rulemaking): December 11, 12, 2025

  • SB 261 climate-risk report posting (statutory): By January 1, 2026

    • Report must be posted on company website

    • Public docket opens December 1, 2025 and closes July 1, 2026

  • Draft S1/S2 reporting templates: By end of September 2025 (for public feedback)

  • SB 253 Scope 1 and 2 reporting (staff proposal): June 30, 2026

  • SB 253 Scope 3 reporting: Begins in 2027 (deadline to be set by CARB)

Who is covered (current direction)

  • Doing business in California: CARB continues to rely on Revenue & Tax Code §23101 (subsections a and b) and is exploring use of Secretary of State listings. Companies are responsible for compliance even if not listed.

  • Revenue threshold: Staff is shifting away from “gross receipts” toward a plain-English “total global revenue” concept (no deductions), consistent with providers like D&B and S&P. This remains open for input.

  • Parent/subsidiary treatment: Staff proposes >50% voting control as the threshold and parent-level consolidation (per SB 219). A self-reporting process may be added to prevent duplicative filings.

  • Proposed exemptions (open for comment): nonprofits, entities with only teleworking employees in California, government entities, CAISO, and entities whose only California activity is wholesale electricity in interstate commerce.

Reporting requirements and assurance

SB 261 (climate-related financial risk):

  • Aligned with TCFD and ISSB S2. Reports must specify the framework used, what’s included vs. excluded, and plans to address gaps.

  • Organizing pillars remain governance, strategy, risk management, and metrics/targets.

  • Quantitative scenario modeling will not be required in year one.

  • Scope 1 and 2 emissions reporting will not be required under SB 261 in year one, to avoid duplication with SB 253.

SB 253 (GHG emissions):

  • Scope 1 and 2 due June 30, 2026 (proposed).

  • Scope 3 reporting begins in 2027 (exact due date pending).

  • Draft templates expected by September 2025.

Assurance:

  • Limited assurance is the proposed starting point.

  • CARB referenced possible standards including ISSA 5000, AA1000, ISO 14060 family, and AICPA.

  • Independence and the potential for CARB audits/oversight were emphasized.

Proposed fees (staff concept)

  • Flat annual fees per program (not per ton), covering ~$13.9M in administrative costs, with inflation adjustments.

  • Estimated annual fees (illustrative):

    • $3,106 for SB 253 entities

    • $1,403 for SB 261 entities

  • Entities with revenue over $1B would pay both.

  • Parent companies may pay fees on behalf of subsidiaries.

  • Final fee levels will be refined during rulemaking.

What’s still to be finalized

  • Final revenue definition and approach to “doing business” lists

  • Exact Scope 3 deadline (statutory start is 2027; due date TBD)

  • Assurance framework details (level, standards, verifier oversight)

  • Final fee levels after rulemaking record

What companies should do now

For SB 261: Lock in your January 1, 2026 website publication plan; align to ISSB S2/ TCFD structure; prepare to submit your public link to CARB starting December 1, 2025 and before the docket closes July 1, 2026.

For SB 253: Stand up Scope 1 and 2 data systems and controls now to comfortably meet the proposed June 30, 2026 deadline; review forthcoming CARB templates (by end of September 2025) as soon as they’re posted.

Scope 3 readiness: Map categories, data owners, and estimation methods; build toward a 2027 first submission.

Governance & assurance: Establish or fortify your climate governance, document controls, and segregation of duties in anticipation of limited assurance and potential CARB audits; Begin interviewing assurance providers comfortable with accepted emissions verification standards (ISSA 5000/ AA1000 / ISO 14060 family / AICPA)

Budgeting: Plan for annually recurring flat fees (both programs if >$1B revenue).

While CARB’s rulemaking is ongoing, the direction is clear. Companies that begin preparing governance, data systems, and assurance readiness now will be best positioned to meet deadlines and minimize compliance risk.

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[Merged from #35] SB 261 injunction and SB 253 updates explained

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

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 November 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 November 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.

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[Merged from #36] Updated SB 253 & 261: claims overview and timeline

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

California’s SB 253 and SB 261 were enacted in October 2023 when Governor Gavin Newsom signed them into law. Since enactment, here is the legal evolution of these two California bills:

  • In January 2024, the U.S. Chamber of Commerce, California Chamber of Commerce, and allied business groups sued California and CARB, challenging both SB 253 (the Climate Corporate Data Accountability Act) and SB 261 (the Climate‑Related Financial Risk Act).
    • The complaint asserted multiple constitutional claims, including:
      • Compelled speech
      • Supremacy Clause / federal preemption
      • Extraterritorial regulation / Dormant Commerce Clause
  • On November 5, 2024, the District Court denied the plaintiffs’ motion for summary judgment on their facial First Amendment challenge, reasoning that factual development was needed to assess which level of scrutiny should apply and whether the laws were appropriately tailored.
  • On February 3, 2025, the U.S. District Court for the Central District of California granted a partial motion to dismiss:
    • It dismissed the Supremacy Clause and extraterritoriality claims relating to SB 253 (without prejudice), finding them not yet ripe.
    • For SB 261, the Court dismissed the Supremacy Clause claim with prejudice and the extraterritoriality claim without prejudice.
    • The First Amendment claim was preserved.
  • On August 13, 2025, the District Court denied the plaintiffs’ motion for a preliminary injunction seeking to block enforcement of SB 253 and SB 261 while the case proceeds.
    • The Court held that the plaintiffs had not demonstrated a likelihood of success on the merits of their First Amendment claims.
    • Because of that denial, SB 253 and SB 261 remain in effect while the litigation continues.
    • The decision was immediately appealed to the Ninth Circuit. All further District Court proceedings are stayed until resolution of the appeal.
  • The case is now focused primarily on the First Amendment claim.
  • A hearing on the plaintiffs’ request for an injunction pending appeal in the Ninth Circuit was scheduled for September 15, 2025. The business‑group plaintiffs filed their opening brief in the Ninth Circuit on September 18, 2025. An opposition motion was filed by the State on September 25, 2025.
  • On January 9, 2025, oral arguments for the Ninth circuit appeal will be presented.

Meanwhile, CARB has not yet adopted final implementing regulations for SB 253 or SB 261. Because CARB’s regulations are not finalized, many of the substantive obligations and burdens are still uncertain, and the content of those rulemakings may affect future litigation strategy and outcomes. Stakeholders should closely monitor the Ninth Circuit’s handling of the appeal, CARB’s rulemaking, and any further motions to revisit the dismissed constitutional claims (e.g., reviving preemption or extraterritoriality claims once regulations are in place).

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