FOCUS, A Leonine Business
The California Air Resources Board (CARB) has recently taken multiple steps toward implementing the state’s new climate disclosure framework, created by two 2023 laws. SB 253/Chapter 382, known as the Climate Corporate Data Accountability Act, requires large companies doing business in California with annual revenues over $1 billion to publicly report their greenhouse-gas emissions. SB 261/Chapter 383, requires U.S. companies doing business in California with annual revenues exceeding $500 million to prepare and publicly release a report on their climate-related financial risks and the measures adopted to mitigate or adapt to those risks. The first reports are due January 1, 2026, and are required to be updated every two years.
In September, CARB released a Climate Related Financial Risk Report Checklist and a preliminary list of reporting entities. In October, the board released a draft reporting template for Scope 1 and Scope 2 greenhouse gas emissions. As California moves from policy design to implementation, the release of CARB’s preliminary list marks a crucial step, turning legislative mandates into actionable compliance for thousands of companies.
The list identifies companies that the agency believes will be subject to the new disclosure requirements. The preliminary list includes over 3,000 unique entities expected to report, underscoring the breadth and scale of the state’s initiative, which encompasses some of the largest U.S. and global corporations doing business in California. Of the entities listed, the majority are covered by both laws. The majority of listed companies are stock corporations but there are also notable groups of nonprofits, including public benefit and religious nonprofits, which signals that the law will reach beyond for-profit entities to include mission-driven organizations as well.
While California continues to lead in shaping corporate climate transparency, other states are beginning to take notice. In 2025, lawmakers in Colorado, Illinois, New Jersey and New York introduced similar climate disclosure proposals, and several others explored studying the issue further. Although those measures did not advance, California’s progress in building a detailed framework may make it easier for other states to follow suit as momentum for consistent, nationwide standards grows. FOCUS will continue to monitor climate change disclosure requirements in state legislatures across the country.
by Anastasia Douglas 10/13/25
