SUSTAINABILITY DESK

Week of March 16

The regulatory landscape is in a tug of war: the EPA’s endangerment finding faces its biggest legal challenge yet, the EU Omnibus formally takes effect, California’s SB 253 clock keeps ticking, and Big Oil is pulling green investment at exactly the wrong time.

Table of Contents

U.S. CLIMATE LAW

24 states sue EPA over endangerment finding repeal

Two dozen states, D.C., the U.S. Virgin Islands, and roughly a dozen cities and counties sued Thursday over EPA’s rescission of the 2009 endangerment finding. That finding was the legal basis for virtually all federal climate regulation under the Clean Air Act: vehicle standards, power plant rules, oil and gas regulations. The case will likely consolidate with a suit environmental groups filed in February, making it the largest legal challenge yet to the administration’s climate rollbacks. Courts have uniformly rejected challenges to the finding since the Supreme Court’s 2007 Massachusetts v. EPA ruling. This is the fight over whether the federal government has a legal obligation to regulate carbon at all.

EU REPORTING

EU Omnibus enters into force

The Omnibus I Directive entered into force March 18, raising CSRD reporting requirements scope thresholds to 1,000 employees and €450M in turnover — knocking thousands of companies out of mandatory reporting. Member states must transpose by March 2027, with first application for FY2027. The CSDDD follows on a longer timeline, with transposition due July 2028. Despite the scope reduction, 90% of companies removed from CSRD under the Omnibus plan to continue or expand sustainability reporting. Simplified ESRS must be adopted by September 2026.

Also notable: the Omnibus deleted the CSDDD requirement for companies to adopt climate transition plans, though companies must still disclose any plan they have.

CALIFORNIA COMPLIANCE

SB 253 workshop Monday

CARB’s next public workshop on California SB 253 and SB 261 is Monday, March 23, 1:00–4:00 PM PT. CARB unanimously approved SB 253 implementing regulations on February 26. The August 10 Scope 1 and 2 deadline is real for covered entities—companies with $1B or more in revenue doing business in California.

Key details: CARB will accept good-faith first-year submissions and will not require assurance on Scope 1 and 2 in year one. Companies not collecting data as of December 2024 can file a non-reporting statement — but if you’ve already published emissions data, you cannot claim you didn’t have it. SB 261 remains under Ninth Circuit injunction. California SB 253 is fully live.

ENERGY INVESTMENT

Big Oil slashes green investment for the first time in eight years

Low-carbon spending by oil and gas majors fell by more than a third — to $25.7 billion from over $38 billion in 2024 (BloombergNEF). It’s the first decline since 2017. Supermajors are prioritizing core oil and gas, which remains more profitable. BP and Shell reversed early-2020s pledges to cut production. Exxon and Chevron never made them. Meanwhile, global clean energy transition investment hit a record $2.3 trillion in 2025. The gap between what the industry says and what it funds keeps widening.

CLIMATE SCIENCE

The warning signs keep flashing

New research this month found global warming has accelerated since 2015 even after removing natural variability. The world has warmed nearly 1.5°C and appears on track to surpass 2°C. Wall Street is pricing in 3°C or more. Meanwhile, the Iran conflict continues to roil energy markets: attacks on Qatar’s Ras Laffan terminal pushed European gas prices up 30%, and Asian utilities are turning back to coal — making the case for energy independence through renewables in real time. The ISSB continues work on nature-related disclosure, with an exposure draft expected in October 2026.

STATE LEGISLATION

New York moves toward its own climate disclosure law

New York’s state senate passed its own version of a climate corporate data accountability act (SB 9072A) in February, potentially making it the second state after California to require emissions disclosure. A companion bill (AB 4282A) has been introduced in the Assembly. Worth watching as the patchwork of U.S. state-level climate reporting requirements continues to grow.

Also notable

ISSB continues updates

ISSB continues work on nature-related disclosure requirements, with an exposure draft expected in October 2026.

Ready to streamline your emissions reporting and compliance readiness?

Frequently Asked Questions

What is the endangerment finding, and why does the EPA lawsuit matter?

The 2009 endangerment finding was the EPA’s formal determination that greenhouse gases threaten public health and welfare—the legal foundation for virtually all federal climate regulation under the Clean Air Act. The Trump administration rescinded it in February 2026. The multistate lawsuit filed in March argues that rescission was unlawful, and courts have consistently upheld the finding since the Supreme Court’s 2007 Massachusetts v. EPA decision. If the rescission stands, the federal government would lose its primary legal authority to regulate carbon emissions. If it’s overturned, that authority is restored.

The EU Omnibus I Directive, which entered into force March 18, 2026, significantly narrowed CSRD scope. For U.S. companies, CSRD now applies only if the parent has over €450 million in annual EU revenue and an EU subsidiary or branch generating over €200 million in EU revenue. First required reporting covers FY2027 data. The CSDDD follows a separate timeline, with member state transposition due by July 2028. Companies removed from mandatory scope should note that 90% of their European peers plan to continue reporting voluntarily — the business case for disclosure hasn’t changed.

California SB 253, the Climate Corporate Data Accountability Act, requires companies with $1 billion or more in annual revenue that do business in California to disclose Scope 1 and 2 greenhouse gas emissions. The first-year reporting deadline is August 10, 2026. CARB will accept good-faith submissions and will not require third-party assurance on Scope 1 and 2 in year one. Companies that have not been collecting emissions data can file a non-reporting statement, but companies that have already published emissions data are expected to report. Scope 3 and assurance requirements will follow in a separate 2027 rulemaking.

No. California SB 261, which requires climate-related financial risk disclosure for companies with $500 million or more in revenue, remains under a Ninth Circuit injunction and is not currently being enforced. More than 120 companies have voluntarily submitted reports. SB 253 is fully live; SB 261 is not.

New York’s state senate passed SB 9072A in February 2026, which would require emissions disclosure for companies doing business in the state with over $1 billion in revenue — mirroring California’s SB 253. A companion Assembly bill has been introduced. The legislation has not yet passed both chambers or been signed into law, but it signals a clear trend: state-level climate disclosure requirements are expanding, and companies with multi-state operations should be building reporting infrastructure that can scale.

The first decline in low-carbon spending by oil and gas majors since 2017 reinforces why independent emissions measurement and reporting matters. When the industry’s own investment signals diverge from net-zero commitments, companies relying on supplier or energy-sector data for Scope 3 reporting face greater uncertainty. It also underscores the importance of building transition plans based on verifiable data rather than voluntary pledges — particularly as ISSB, CSRD, and state-level frameworks increasingly require companies to disclose how they’re managing climate-related financial risk.

Corinne Hanson headshot

Corinne Hanson is VP of ESG Strategy at Greenplaces, the all-in-one sustainability platform helping businesses turn climate goals into results. She brings over a decade of experience in corporate sustainability, including leadership roles at SH Hotels & Resorts, Global Footprint Network, and the NRDC. A George Washington University grad with degrees in International Relations and Philosophy, Corinne spends her time outside the office the same way she spends it inside: trying to keep the planet in good shape.

More resources from Greenplaces