Ref No.
Jurisdiction
California, USA
Key Policymaker(s)
Senator Scott Wiener (D)
Senator Josh Becker (D)
Senator Lena Gonzalez (D)
Senator Henry Stern (D)
Governor Newsom signed this bill into law in October 2023. It requires companies that do business in California with revenues exceeding $500 million to enhance transparency and accountability regarding financial risks associated with climate change.
Key Aspects
Requires companies to publish biennial climate-related financial risk reports on their website every two years, beginning in 2026.
Requires that reports disclose material risks of climate change to their operations, supply chains, investments and financial health as well as measures adopted to reduce or adapt to their risks.
Imposes penalties for failing to make the required disclosures or publishing an inadequate or insufficient report, which may not exceed $50,000 per entity per year. If a company can not provide all of its climate-related financial risk disclosures, they must explain which are missing and their plan to complete them.
Latest Update
On October 12, 2026, CARB’s regulation outlining the requirements of SB 253 and SB 261 was approved and declared effective. SB 261 remains subject to an injunction against the enforcement of the bill, which means that covered entities will not be held accountable for failing to submit reports by the January 1, 2026, deadline. Entities can still voluntarily report as of December 2025.
Source(s)
