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Governance 5 min read Published Updated Credibility 50/100

Governance Briefing — September 18, 2025

California’s climate disclosure laws demand 2025 emissions and risk data now: SB 253 reports on FY2025 Scope 1 and 2 emissions are due in 2026, while SB 261 climate risk reports land January 1, 2026.

Zeph Tech Research Lead

Research lead, Zeph Tech

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Executive briefing: California’s Climate Corporate Data Accountability Act (SB 253) requires companies with over $1 billion in annual revenue doing business in the state to begin public reporting of 2025 Scope 1 and Scope 2 greenhouse gas emissions in 2026, using data assured by an independent verifier. Companion legislation SB 261 mandates biennial climate-related financial risk reports by January 1, 2026 for entities exceeding $500 million in revenue. September 2025 therefore represents the final data-collection quarter to close gaps in inventory systems, scenario analysis, and assurance vendor coordination before filings commence.

Key compliance checkpoints

  • Inventory accuracy. Validate facility-level emissions factors, energy invoices, and activity data covering FY2025 to support limited assurance in the first reporting cycle.
  • Scenario analysis. Align risk assessments with the Task Force on Climate-related Financial Disclosures (TCFD) structure referenced in SB 261, including physical and transition risk narratives.
  • Governance documentation. Capture board oversight minutes, management committees, and control owners responsible for climate data, readying artefacts for both disclosure and assurance reviews.

Operational priorities

  • Assurance engagement. Finalize contracts with accredited assurance providers and schedule FY2025 Scope 1 and 2 testing windows.
  • Data integration. Consolidate utility, fuel, and refrigerant datasets into a single emissions ledger with audit trails and variance analysis.
  • Risk report drafting. Begin SB 261 narrative development covering governance, strategy, risk management, and metrics/targets, ensuring consistency with federal SEC climate proposals if applicable.

Enablement moves

  • Deploy workflow tools to evidence management review and sign-off on emissions calculations ahead of third-party assurance.
  • Cross-map California disclosures with voluntary CDP and ISSB/IFRS S2 reporting to streamline investor communications.

Sources

Zeph Tech aggregates emissions data, coordinates assurance workflows, and structures SB 261 risk narratives for California regulators.

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