Scope 1 and 2 reporting is due November 10. Scope 3 begins in 2027 with 5 mandatory categories. Here is what your organization needs to do now.
California has passed two major climate laws to increase transparency and accountability in corporate environmental impact
253
Emissions ReportingClimate Corporate Data Accountability Act
Requires companies with $1B+ annual revenue doing business in California to publicly report global GHG emissions (Scope 1 and 2 deadline November 10, 2026. Scope 3 from 2027 with 5 mandatory categories initially).
261
Risk AssessmentClimate-Related Financial Risk Disclosure Act
Applies to companies with $500M+ annual revenue, requiring biennial climate risk reports aligned with TCFD framework. Enforcement currently stayed pending Ninth Circuit ruling.
Note: As of November 2025, enforcement of SB 261 has been stayed by the Ninth Circuit Court of Appeals pending resolution of an ongoing legal challenge. CARB will announce a revised reporting date once the appeal is resolved.
Understanding which companies are subject to California's climate disclosure requirements
| Law | Revenue Threshold | Business Activity | Status |
|---|---|---|---|
| SB 253 | $1 billion+ | Doing business in California | Active |
| SB 261 | $500 million+ | Doing business in California | Enforcement stayed |
Important deadlines and reporting requirements for California climate laws
| Bill | Coverage Threshold | Reporting Starts |
|---|---|---|
| SB 253 | ≥ $1B revenue | Scope 1 and 2 (2025 data) - deadline November 10, 2026. Scope 3 from 2027, with 5 mandatory categories initially. |
| SB 261 | ≥ $500M revenue | Currently stayed pending Ninth Circuit appeal. New deadline to be set by CARB post-ruling. |
CARB extended the SB 253 Scope 1 and 2 reporting deadline to November 10, 2026. CARB's July 21, 2026 workshop confirmed Scope 3 reporting begins in 2027, limited initially to 5 mandatory categories: Purchased Goods and Services, Fuel and Energy Related Activities, Waste Generated During Operations, Business Travel, and Employee Commuting. Limited assurance on Scope 1 and 2 begins in 2027. A full guidance package is expected by September 1, 2026.
Key compliance requirements and potential risks for companies subject to California climate laws
Best practices and strategies for successful compliance with California climate laws
Start establishing ESG data governance now. Designate roles, build a cross-functional data team, and centralize emissions & risk data repositories
Prepare for limited assurance of Scope 1 & 2 emissions beginning in 2027 by strengthening data controls, documentation, and audit trails.
Plan early for Scope 3: focus first on the 5 mandatory categories confirmed by CARB - Purchased Goods and Services, Fuel and Energy Related Activities, Waste Generated During Operations, Business Travel, and Employee Commuting. A full guidance package is expected by September 1, 2026.
For SB 261 compliance: map climate risks, strategies, and metrics using TCFD; align with existing reports (e.g., CDP, SASB, ISSB).
Track litigation around SB 253. SB 261 enforcement is currently stayed. Track the Ninth Circuit's ruling, if the stay is lifted, a new compliance deadline will be set by CARB with potentially short lead time.
Explore our resources curated to help you understand and navigate the challenges of California Climate Laws.
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27 Nov 2025 · Saransh Srivastava
14 Oct 2025 · Vishakha Goel
26 Sep 2025 · Vishakha Goel
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Note: The number of entities listed above is based on staff analysis of CA Secretary of State and Dunn & Bradstreet data. CARB will be initiating a process to validate the preliminary list of covered entities.
Final list of covered entities subject to confirmation via CARB's applicability assessment process (September 10, 2026).
Companies may discuss the resilience of their strategy considering future climate change impacts under various climate scenarios. CARB encourages including qualitative scenario-based assessments where feasible and relevant, describing how the organization's strategy may respond to potential climate-related risks and opportunities. This discussion can focus on strategic adjustments, risk mitigation measures, and long-term planning to ensure the organization remains resilient under changing climate conditions.
Note: SB 261 enforcement is currently paused. However, companies are advised to continue internal scenario analysis as part of broader climate risk governance and in preparation for when enforcement resumes.
SB 261 has been stayed by the Ninth Circuit Court of Appeals since November 18, 2025, pending the outcome of a legal challenge brought by the U.S. Chamber of Commerce. CARB is not currently enforcing SB 261, and the original January 1, 2026 deadline is no longer operative. However, the law has not been repealed. CARB has confirmed it will set a new reporting date once the appeal is resolved. Companies are advised to continue building their climate risk governance frameworks so they are ready to comply when enforcement resumes.
CARB's July 2026 workshop confirmed that initial Scope 3 reporting will be limited to 5 categories: Purchased Goods and Services, Fuel and Energy Related Activities, Waste Generated During Operations, Business Travel, and Employee Commuting. The remaining 10 GHG Protocol categories are voluntary for now with no timeline given for when they may become mandatory.
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