California’s climate disclosure landscape continues to evolve, and companies subject to SB 253 should be paying close attention. During its July 21, 2026 public workshop, the California Air Resources Board (CARB) provided important updates on greenhouse gas (GHG) reporting requirements for 2026 and outlined its vision for a more comprehensive reporting framework beginning in 2027.
While many aspects of California's climate disclosure program are still being defined through ongoing rulemaking, the July 21st workshop provided additional insight into CARB's implementation plans and reinforced the importance of preparing for upcoming reporting requirements.
California's Climate Corporate Data Accountability Act (SB 253) requires U.S.-based companies doing business in California with annual revenues exceeding $1 billion to publicly disclose their GHG emissions in accordance with the Greenhouse Gas Protocol. Reporting for Scope 1 and Scope 2 emissions is scheduled to begin in 2026, with Scope 3 reporting requirements following in 2027.
Although litigation surrounding California's climate disclosure laws remains ongoing, implementation of SB 253 continues to move forward while SB 261 remains subject to a preliminary injunction. At the same time, CARB is continuing to develop guidance and future regulations that will shape reporting, disclosure, and assurance requirements in the years ahead. As a result, organizations should use this time to better understand their potential obligations, evaluate the readiness of their GHG inventories, and prepare for an evolving regulatory landscape.
CARB Extends the Initial SB 253 Reporting Deadline
One of the most significant updates was CARB's confirmation that it plans to move the initial reporting deadline for Scope 1 and Scope 2 emissions to November 10, 2026, giving organizations additional time to prepare following final adoption of the initial regulations. CARB also confirmed its plans to resubmit the Initial Regulation for a 15-day public comment period (ending on August 11th, 2026), before finalizing the revised rulemaking package.
In addition, CARB reiterated that it intends to maintain enforcement flexibility for good-faith first-year submissions, acknowledging the challenges many organizations may face as they implement new GHG reporting programs.
CARB also announced that it expects to release additional reporting guidance by September 1, 2026, including:
- A voluntary online reporting platform
- Instructions for fee contact information submission
- A reporting guidance document
- Educational and instructional materials for reporting entities
Organizations should not view the deadline extension as a reason to delay data collection and inventory development efforts. The additional months provide a valuable opportunity to refine methodologies, address data gaps, and prepare for future reporting and assurance requirements.
Greater Alignment with Established Climate Reporting Frameworks
For 2027 and beyond, CARB indicated that its proposed regulations will closely align with the Greenhouse Gas Protocol while adding California-specific regulatory requirements and clarifications. CARB also emphasized a desire to improve interoperability with other major disclosure frameworks, including:
- IFRS S2
- European Union Corporate Sustainability Reporting Directive (CSRD)
- Other emerging climate disclosure programs
The goal is to reduce reporting burden for companies already participating in multiple sustainability disclosure programs while ensuring consistency and transparency across jurisdictions.
More Detailed Greenhouse Gas Reporting Requirements Beginning in 2027
CARB previewed several areas where future regulations will provide greater specificity, including:
- Quantification methodologies
- Measurement uncertainty
- Missing data protocols
- Emissions factor selection
- Biogenic emissions reporting
- Emissions reductions and removals
- Data exclusion criteria
- Methodology change notifications
- Recalculation of prior-year emissions
- Supplemental disclosures
These proposed requirements signal CARB's intent to move beyond basic emissions disclosure and toward a more robust and auditable reporting framework.
Proposed Phased Approach for Scope 3 Emissions Reporting
Recognizing the complexity of Scope 3 emissions, CARB proposed a phased implementation approach beginning in 2027. Initially, reporting would focus on five categories commonly reported under the Greenhouse Gas Protocol:
- Category 1: Purchased goods and services
- Category 3: Fuel and energy-related activities
- Category 5: Waste generated in operations
- Category 6: Business travel
- Category 7: Employee commuting
CARB indicated that reporting entities may exclude certain categories if they meet established exclusion criteria, but organizations will be required to document and explain any exclusions. At this time, CARB has not identified when the remaining Scope 3 categories will become mandatory.
For many organizations, Scope 3 emissions represent the largest and most challenging portion of their carbon footprint. Developing supplier engagement and data collection processes now can help avoid future compliance challenges.
Insurance Companies May Be Subject to SB 253 Climate Disclosure Requirements in 2027
Another noteworthy update was CARB's indication that insurance companies are expected to become subject to SB 253 reporting requirements beginning in 2027. CARB explained that existing industry reporting requirements do not fully satisfy SB 253 disclosure obligations, particularly regarding Scope 3 emissions and assurance requirements.
This change could significantly expand the number of organizations required to develop formal GHG reporting programs.
Third-Party Assurance Requirements Continue to Evolve
Beginning with future reporting cycles, CARB proposes accepting five primary third-party GHG assurance standards:
- ISO 14064-3
- ISSA 5000
- ISAE 3000/3410
- AICPA AT-C 210/205
- AA1000AS v3
As CARB continues to develop the regulatory framework, organizations may want to consider how future assurance requirements could influence their GHG inventory, documentation, and reporting processes.
How Organizations Can Prepare for Evolving SB 253 Reporting and Assurance Requirements
While CARB continues to refine reporting, disclosure, and assurance requirements under SB 253, organizations should take steps now to assess their readiness rather than wait for final regulations.
Even with ongoing rulemaking activity and legal uncertainty, companies can begin building a foundation for future compliance by:
- Determining whether SB 253 applies to their organization
- Developing or refining their GHG inventory
- Evaluating the availability and quality of Scope 1 and Scope 2 emissions data
- Beginning to assess potential Scope 3 reporting obligations
- Documenting emissions calculation methodologies and assumptions
- Identifying data gaps and establishing procedures for future reporting
- Strengthening data management and recordkeeping processes to support potential assurance requirements
Engaging an accredited third-party assurance partner early can help organizations identify potential issues before they become compliance challenges, stay current on evolving CARB requirements, and better understand how their inventories align with Greenhouse Gas Protocol and emerging SB 253 expectations. This proactive approach can provide valuable time to address gaps and adapt to regulatory changes before reporting and assurance requirements take effect.
As California's climate disclosure framework continues to evolve, organizations that begin preparing now will be better positioned to meet future reporting, disclosure, and assurance obligations.
