By: Alyssa Zucker, Senior Industry Principal, [Workiva](https://www.workiva.com/)
Following the California Air Resources Board’s (CARB) first public workshop on May 29, 2025, regarding the state’s climate disclosure laws (SB 253 and SB 261), many questions remained. These laws mandate large businesses in California to report on greenhouse gas emissions and climate-related risks, respectively. On June 9, 2025, CARB addressed these queries through a formal [FAQ document](https://ww2.arb.ca.gov/sites/default/files/2025-07/FAQs%20Regarding%20California%20Climate%20Disclosure%20Requirements.pdf), providing guidance on initial planning and compliance with Health & Safety Code § 38532 & 38533, which encompass the Climate Corporate Data Accountability Act (SB 253) and the Climate-Related Financial Risk Act (SB 261).
CARB’s emphasis on flexibility reflects a pragmatic approach as it continues to gather stakeholder feedback on key requirements such as applicability and exemptions. Reporting deadlines remain unchanged, with prescriptive rules expected by year-end. The FAQ offers critical clarifications for companies preparing for inaugural disclosures, suggesting a practical on-ramp for businesses to establish necessary programmes and infrastructure. This approach aims to maintain the intent of the laws without imposing undue burdens, enhancing transparency and corporate accountability.
**Key Clarifications from the FAQ:**
– **Submission of SB 261 Reports:** On December 1, 2025, CARB will open a public docket for covered entities to post links to their climate-related financial risk reports. This docket will remain open until July 1, 2026, promoting transparency.
– **Acceptable Climate Risk Reporting Frameworks (SB 261):** Reporting aligned with TCFD guidelines is acceptable. Although not explicitly stated, IFRS S2-aligned reports are also acceptable, easing the reporting burden on companies.
– **Data Year for SB 261 First-Year Reports:** Reports may reflect data from FY 2023/2024 or FY 2024/2025. This flexibility supports first-time reporters. However, emissions reporting for SB 253 due in 2026 must reflect FY 2025 data.
– **”Good Faith Efforts” for Non-Enforcement in SB 261:** Companies can base disclosures on the best available information, with the understanding that data quality may evolve. While CARB has not committed to non-enforcement penalties, the flexibility offered provides companies with the ability to meet the law’s intent.
**Remaining Unknowns and Ongoing Solicitations:**
– **Prescriptive Reporting Rules:** CARB is still developing these requirements, expected by year-end.
– **Exact Reporting Deadlines (SB 253):** While the years for reporting are known (2026 for Scope 1 & 2; 2027 for Scope 3), specific dates remain undetermined. SB 261 reports are due January 1, 2026.
– **Refined Applicability:** SB 253 applies to businesses in California with over $1 billion in revenue, and SB 261 applies to those with over $500 million. CARB is soliciting feedback on the definitions of “doing business” and “revenue” for applicability and exemptions.
The recent clarifications from CARB represent a significant step forward for California’s climate disclosure landscape. By prioritising flexibility and “good faith” non-enforcement for initial reporting periods, CARB facilitates a smoother transition for businesses navigating these new regulations. This approach reduces early compliance risks and supports the development of internal infrastructure necessary for climate strategy and disclosure programmes. CARB’s stakeholder-centric approach fosters collaboration towards robust corporate climate transparency, better informing risk exposure across California’s economy.
*About the author:*
*Alyssa Zucker is Senior Industry Principal at Workiva, where she leads the company’s strategy for customer-facing climate and sustainability content. With 15 years of corporate sustainability experience, she guides programme recommendations, emissions accounting, and sustainability disclosure within the Workiva Carbon solution. Previously, Alyssa was Chief Sustainability Officer at Sustain.Life (now part of Workiva) and directed the sustainability programme at Vornado Realty Trust. She holds an MPA in Environmental Science and Policy from Columbia University and a BA in Environmental Studies from Washington University in St. Louis.*
