California Climate Corporate Data Accountability Act
Governmental Agency: California State Legislature
Jurisdiction: California, USA
Ref no: SB-253
Status: ADOPTED
The California Global Warming Solutions Act of 2006 mandated the State Air Resources Board to oversee and enforce the reporting of greenhouse gas emissions. This bill, which aims to provide increased transparency and accountability for corporate greenhouse gas emissions in California, requires large business entities in California with revenues exceeding $1 billion to disclose their scope 1 and 2 emissions starting 2026, and scope 3 emissions from 2027. The key provisions and impacts of the act include:
- Public Disclosure of Greenhouse Gas Emissions: Large businesses in California are required to publicly disclose their greenhouse gas emissions, promoting transparency and awareness of corporate emissions.
- Regulations for Reporting Entities: The State Air Resources Board will develop regulations for reporting entities to disclose their emissions, ensuring clear guidelines and standards for reporting.
- Public Availability of Emission Data: Emissions data will be made publicly available on a digital platform, enabling stakeholders and the public to analyze and understand the emissions data.
- Climate Accountability and Emissions Disclosure Fund: The act establishes a fund to cover implementation costs, providing financial support for compliance with the disclosure requirements.
- Penalties for Non-Compliance: The state board is authorized to seek administrative penalties for non-compliance, promoting accountability and compliance.
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The Act will have significant implications for large businesses operating in California.
The act mandates that these businesses must publicly disclose their greenhouse gas emissions, which will require them to invest in tracking, measuring, and reporting their emissions, potentially incurring additional costs related to data collection, analysis, reporting and third-party verification.
Additionally, the State Air Resources Board will develop regulations for reporting entities to disclose their emissions, and the data will be made publicly available on a digital platform, necessitating compliance with the regulations and allocation of resources to make emissions data accessible to the public.
This will mean companies will need to invest resources in conducting thorough due diligence on their entire value chain to identify and address potential climate risks and environmental impacts, potentially leading to increased transparency and accountability in supply chains and the adoption of more sustainable practices.
Finally, the Fund will also impose financial implications on businesses. Non-compliance may result in administrative penalties
