California has recently passed three climate disclosure laws, with another one still pending. These new laws are an attempt to increase transparency and consistency in climate-related disclosures, including greenhouse gas (GHG) emission and carbon offset disclosures, and to promote climate risk mitigation, including decarbonization.
The state appears to be taking steps independent of the Securities and Exchange Commission (SEC), as highlighted in the recent report from JD Supra. This indicates a growing proactive stance on environmental policy from state legislatures, which may have implications for businesses and corporations operating within these jurisdictions.
Senate Bill 253, also known as the “Climate Corporate Data Accountability Act” (“SB 253”), is one of these new laws. Another measure, Senate Bill 261, refers to “Greenhouse gases: climate-related financial risk” (“SB 261”), and the third law falls under the Assembly. These legislative measures represent a comprehensive approach to tackling the climate challenge.
With these laws in place, business entities in California will be required to offer more detailed and consistent climate-related disclosures. Legal professionals handling environmental law and corporate governance within these organizations should thoroughly examine these newly enacted measures. The expectation is that these laws will drive greater accountability for corporations when it comes to climate-related risks.
Looking forward, the enactment of these bills puts the spotlight on comprehensive climate-related legislative efforts and serves as an important lesson for other states contemplating similar legislation. It also underscores the importance of businesses and corporations in contributing to managing and mitigating climate risks.