Fact Sheet: Understanding California's Climate Legislation — What You Need to Know About SB 253 and SB 261
AUTHOR: VERDANI REGULATORY AND RESILIENCE TEAMSMAY 5, 2025Highlights
California’s New Regulations Raise the Bar: California’s SB 253 and SB 261 set a new standard by requiring full value chain (scope 3) emissions reporting and public disclosure of climate-related financial risks. These laws reflect a broader market shift: climate disclosure is becoming the norm, not the exception.
Reaching Beyond State Borders: Companies doing business in California and meeting certain revenue thresholds are required to disclose company-wide emissions and climate risks, even if the company and its emissions and risks are located out of state.
What Companies Should Do Now:
Begin preparing to report 2025 climate risk data in January 2026 and 2025 emissions data in 2026 (exact date TBD).
Align disclosures with international frameworks to maintain consistency and credibility.
Proactively adapt to build resilience, manage risks, attract investment, and strengthen stakeholder trust.
How Verdani Partners Can Support You: Verdani Partners offers strategic and technical expertise across ESG data management, scope 1–3 emissions inventories, climate risk assessments, stakeholder engagement, and regulatory reporting — helping organizations navigate California’s evolving climate disclosure landscape with confidence.
Introduction
The state of California has long been a trailblazer in environmental policy. A recent example is its climate legislative duo, the Climate Accountability Package (CCAP), which includes Senate Bills 253 and 261. These laws are setting a new bar in the U.S. for corporate climate accountability and establish California as a national leader in emissions disclosure and climate risk governance. Both bills were signed into law in October 2023 and later amended by SB 219 in 2024, which clarified implementation timelines and reporting details.
These bills are changing the landscape of transparent and consistent climate-related disclosures for U.S. companies. On Jan 1, 2026, many companies will publicly disclose their climate risks for the first time, which will no doubt spur positive changes in how their organizations track and manage their climate-related risks and activities. At Verdani Partners, a leading sustainability consulting firm, we support organizations by helping them understand their obligations, develop compliant reporting strategies, and integrate climate risk and emissions management into their operations.