The California Air Resources Board (CARB) released a preliminary list of over 4,000 companies required to begin reporting under California’s new climate disclosure laws, Senate Bill (SB) 253 and SB 261. Signed into law just over a year ago, the laws apply broadly to large companies doing business in California, regardless of where they are headquartered, and are intended to establish greater transparency around emissions and climate-related risks.

Of the 4,160 companies identified, 2,596 will be subject to both SB 253 and SB 261, while 1,564 will be required to comply only with SB 261. Roughly 60% of the companies, or 2,503, on the list are headquartered outside California, underscoring the wide reach of the state’s requirements.

SB 253 applies to companies with more than $1 billion in annual revenues. Beginning in 2026, companies will be required to report Scope 1 and Scope 2 greenhouse gas emissions, with Scope 3 reporting, which covers value chain emissions, to follow in 2027. SB 261 applies to US companies with annual revenues exceeding $500 million. Covered companies must file biennial reports beginning in January 2026 describing climate-related financial risks and the steps taken to address those risks. 

CARB emphasized that the list, compiled using 2022 revenue data, is preliminary. The statutory thresholds are controlling and inclusion in the list or omission does not determine whether a company must comply.  

Earlier this month, CARB released a Draft Checklist providing guidance for companies preparing their first reports. The publication outlined an exemption for subsidiary companies from the reporting requirements, if the subsidiary’s parent company issues a report on its behalf.  In addition, CARB clarified that companies may follow one of several reporting frameworks when making the required disclosures, including the recommendations of the Task Force on Climate-Related Financial Disclosure (TCFD), the International Sustainability Standards Board’s (ISSB) IFRS S2 climate reporting standard, in addition to any framework provided by a regulated exchange or national government.  Read the Climate Related Financial Risk Disclosures: Draft Checklist

California’s disclosure regime moves ahead even as the SEC’s climate disclosure rule remains stalled in litigation, as we previously discussed.