California confirms series of reliefs to ease first year of climate reporting for companies

illuminem summarises for you the essential news of the day, reviewed by our editorial team. Read the full piece on ESG Today or enjoy below:

🗞️ Driving the news: The California Air Resources Board has released guidance easing the first year of corporate climate reporting under SB 253, with initial reports due 10 November
• CARB will exercise enforcement discretion instructing companies to submit prior fiscal year data they already held
• Companies that did not collect data when the 2024 enforcement notice was issued may skip Scope 1 and 2 reporting entirely as submissions will be accepted with or without limited assurance for the 2026 cycle.

🔭 The context: SB 253 requires companies with over $1 billion in revenue doing business in California to report Scope 1 and 2 emissions annually, adding Scope 3 value chain emissions in later years
• CARB signalled transitional flexibility in its 2024 enforcement notice, citing the lead time companies need to build data collection processes
• Firms not reporting this cycle are urged to submit a statement of non-reporting on company letterhead
• Multiple formats are permitted, including existing annual reports, data already filed to other programmes, or CARB's draft template, with no mandated emission factor dataset for 2026

🌍 Why it matters for the corporate sustainability: Many large companies have simply never measured their own emissions, and SB 253 is the biggest US rule forcing them to start
• The reliefs do not remove that requirement, but they do mean this first round of data will be patchy with different companies counting in different ways, no shared conversion factors, and figures no auditor has checked

⏭️ What's next: CARB is running a rulemaking cycle covering 2027 onwards, addressing GHG accounting methodologies, deadlines, assurance requirements and reporting formats
• A voluntary intake platform has launched to support initial submissions

💬 One quote: CARB stated it "recognizes that companies may need some lead time to implement new data collection processes" in order to report fully on Scope 1 and 2 emissions — California Air Resources Board, 2024 enforcement notice

📈 One stat: $1 billion in revenue — the threshold above which companies doing business in California must report.

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