California Amends its Climate-Related Disclosure Laws
by Sara Osorio, Environmental, Health and Safety Affairs Coordinator Oct 12, 2024

On September 27, 2024, California Governor Gavin Newsom signed SB 219, the Greenhouse Gases: Climate Corporate Accountability: Climate Related Risk Act, into law. SB 219 amends two previous laws enacted in October 2023, SB 253 and SB 261. These laws are the first of their kind in the U.S., marking a major step towards corporate climate accountability.

The basic requirements for these two laws are as follows:

  • SB 253 mandates that companies with over $1 billion in annual revenue doing business in California disclose their Scope 1, Scope 2, and Scope 3 greenhouse gas (GHG) emissions, providing greater transparency on their carbon footprint.
  • SB 261 applies to companies with revenues exceeding $500 million, requiring them to disclose their climate-related financial risks and outline the steps they are taking to address these risks.

SB 253 and SB 261 introduced significant climate-related disclosure requirements for U.S. public and private companies that operate in California and meet specific annual revenue thresholds, as outlined in this First To Know, published earlier this year.

The amendments to the two bills address several gaps that were present in the original bills. For example, SB 219 grants the California Air Resources Board (CARB) the authority to develop implementing regulations and provides them with the necessary time and discretion to address these open questions, ensuring a smoother rollout of the new requirements. However, the bills do not fully define what it means to "do business" in California, nor do they clarify how companies should calculate their annual revenues for compliance purposes. It is expected that CARB will provide additional details on these two requirements.

Below are some of the changes enacted by SB 291:

SB 253

  • Reporting Delay: Extended deadline for CARB to adopt implementing regulations from January 1 to July 1, 2025. However, it does not alter the years for which covered entities need to disclose, it has only provided the agency with more time to develop the regulations.
  • Scope 3 Disclosures: SB 219 requires CARB to establish a timeline for reporting entities to disclose their Scope 3 GHG emissions, replacing the previous rule that mandated disclosure within 180 days of reporting Scope 1 and Scope 2 emissions. This may provide some additional time for companies to report on their much more complex Scope 3 emissions.
  • Emissions Reporting Organizations: Changes the requirement for CARB to contract with an emissions reporting organization under SB 253, now making it optional instead of mandatory.
  • Report Consolidation: Allows GHG emissions to be reported at the parent-company level, meaning subsidiaries don’t need separate reports. This aligns SB 253 with the consolidated reporting allowed under SB 261 for climate-related financial risks.

SB 261

  • Climate Reporting Organization: Like in SB 253, SB 261 required CARB to contract with a climate reporting organization for biennial climate risk reports. SB 219 now makes this contract optional.

SB 219 also removed the obligation to pay a fee “upon filing a disclosure.” However, the new legislation did not abolish annual fee requirements.

The changes imposed by SB 219 to the climate-related disclosure laws don’t significantly alter the existing requirements but instead provide CARB with more time and flexibility to develop regulations. While this extension allows the agency to align regulations with other frameworks, such as the EU’s Corporate Sustainability Reporting Directive (CSRD), it also shortens the window between regulation approval and the start of required disclosures. As a result, it’s crucial for entities to start preparing now, ensuring they have strong GHG emissions monitoring, accounting, and auditing systems in place.

In this article, Sara Osorio, Coordinator, EHS Affairs, PRINTING United Alliance, reviews California’s amendments to its Climate Accountability Laws. More information about this and other sustainability issues can be found at Business Excellence-EHS Affairs or reach out to Sara directly if you have questions about how these issues may affect your business: sosorio@printing.org.   
 
To become a member of PRINTING United Alliance and learn more about how our subject matter experts can assist your company with services and resources such as those mentioned in this article, please contact the Alliance membership team: 888-385-3588 / membership@printing.org. 

California Environmental Legislation
Sara Osorio Environmental, Health and Safety Affairs Coordinator
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Sara Osorio is the Environmental, Health and Safety (EHS) Affairs Coordinator at PRINTING United Alliance. Her primary responsibility is to assist members with EHS regulatory compliance, sustainability, and EHS consulting. Sara also monitors the EHS regulatory activities at the federal and state-level that impact the printing industry including those occurring at Environmental Protection Agency (EPA), the Occupational Health and Safety Administration (OSHA), the Department of Transportation (DOT), and other agencies. She develops guidance material for members, gives presentations, and writes articles on EHS regulations and sustainability issues. She also supports the Sustainable Green Printing Partnership and Alliance members in their efforts to certify printing operations in sustainable manufacturing.

Sara received a Bachelor of Science in Environmental Studies from Florida International University and is pursuing and Master of Science in Sustainable Management from the University of Wisconsin – Green Bay.

Speaking Topics:

  • Regulatory compliance and sustainability
  • Webinars on a wide variety of EHS related topics
  • Customized seminars and workshops
  • Employee training on safety and environmental compliance

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