SB 261: California Requires Businesses with Over $500 Million in Total Annual Revenue to Disclose Climate Risks Online
Summary
Enacted in October 2023, SB 261 requires business entities that do business in California and whose total annual revenue exceeds $500 million ("covered entities") to create and publish on their websites a report disclosing the business's climate-related financial risks and measures taken to reduce or adapt to that risk. A climate-related financial risk is defined as a "material risk of harm to immediate and long-term financial outcomes due to physical and transition risks, including, but not limited to, risks to corporate operations, provision of goods and services, supply chains, employee health and safety, capital and financial investments, institutional investments, financial standing of loan recipients and borrowers, shareholder value, consumer demand, and financial markets and economic health."
This law was amended in September 2024 by SB 219 to adjust some requirements of the state board and to remove a filing fee that covered entities previously would have been required to pay to file their disclosures.
