Essential Guide to Navigating California’s Climate Disclosure Laws: Stay Compliant and Informed

On November 18, 2025, the California Air Resources Board (CARB) hosted a virtual workshop about California’s new climate disclosure laws: SB 253 and SB 261. These laws are designed to increase transparency around climate-related financial risks for businesses. While the final regulations won’t come out until early 2026, CARB offered updates on compliance deadlines, key terms, and reporting guidelines.

Updated Compliance Deadlines

• For SB 253, companies must now report on their greenhouse gas (GHG) emissions by August 10, 2026, instead of June 30.
• SB 261 requires businesses to post their climate-related financial risk reports on their websites by January 1, 2026, but reports must be submitted to CARB by July 1, 2026.
• CARB also plans to charge fees for filing: approximately $3,106 for SB 253 and $1,403 for SB 261, due by September 10, 2026.

Key Definitions Updated

CARB refined the definitions for several terms. For instance, “revenue” will align with definitions in California’s tax code, making it easier for businesses to calculate if they meet disclosure requirements. This revenue will be verified through tax filings.

Companies “doing business in California” must meet specific criteria, such as having significant sales within the state, exceeding $735,019 in 2024.

Exemptions

Some organizations may be exempt from these regulations, including government entities and certain non-profits. Additionally, companies with only teleworking employees in California may be excluded.

Updated Reporting Requirements

• For SB 253: Businesses finishing their fiscal years between January 1 and February 1, 2026, will report for that fiscal year. If their fiscal year ends later in 2026, they will use data from 2025.
• For SB 261: This reporting must be based on the best available information, which might come from prior financial years.

Litigation Status

Legal challenges to these laws continue. The U.S. Court of Appeals for the Ninth Circuit issued a temporary injunction halting enforcement of SB 261, but SB 253 remains unaffected for now. Oral arguments are scheduled for January 2026.

Looking Ahead

In early 2026, CARB will announce further requirements, including data assurance processes and additional reporting details. Companies should closely monitor these developments to ensure compliance as the deadlines approach.

Keeping abreast of these updates is not just about compliance; it shows a commitment to sustainability, which resonates well with customers and investors today. Companies that prioritize transparency around climate actions may gain competitive advantages in a market that increasingly values responsible practices.

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