California – First State To Enact Climate Reporting Legislation

On October 7, 2023, California Governor Gavin Newsom signed into law two expansive climate disclosure bills (SB 253 and SB 261), making California the first state in the U.S. to impose requirements on greenhouse gas ("GHG") emissions disclosure and mandate reporting on climate-related financial risks. The SB 253 legislation requires both public — and private — U.S. entities that conduct business in California and have total annual revenue in excess of $1 billion U.S. dollars, to report on their GHG emissions annually and the SB 261 legislation requires entities that conduct business in California and earn at least $500 million U.S. dollars in revenue to report biennially on their climate-related financial risks. The California legislature's stated purpose in adopting this legislation is to address the impact of climate change on the state's residents and economy – a state that has already faced devastating wildfires, sea level rise, drought and extreme weather events,