California air board OKs first rules for corporate climate disclosures
The California Air Resources Board on Thursday approved the first set of rules to put the state’s corporate climate disclosure laws into practice, setting an Aug. 10 deadline for companies to begin reporting greenhouse gas emissions.
Senate Bills 253 and 261 were enacted in 2023, requiring large companies doing business in California to disclose their greenhouse gas emissions and climate-related financial risks. Thursday’s approval established the initial rules needed to implement those laws ahead of their first reporting requirements this year.
The rules apply to U.S. companies with more than $1 billion in annual revenue for emissions reporting and $500 million for climate risk disclosures with some exemptions, including insurers — a point that became a source of tension.
“The Legislature’s intent with respect to the insurance industry is crystal clear. It was excluded from SB 261, and it was not excluded from SB 253. So the law of California is that the insurance industry is included in SB 253’s carbon disclosure requirement,” Sen. Scott Wiener, D-San Francisco, told the board on Thursday.
“I do not believe that the board has the authority to remove an industry that was included by the Legislature,” he continued.
During the presentation, CARB’s staff explained its rationale behind the exemption for insurers, pointing to an existing disclosure program run by the California Department of Insurance that it said already requires companies to report climate risks and emissions data.
But some disagreed.
Dave Jones, a former California insurance commissioner, opposed the exemption, arguing that the Department of Insurance’s climate disclosure program is described as voluntary and does not require full reporting of emissions.
“Right now, the Department of Insurance administers the NAIC Climate Risk Disclosure Survey ... it’s described as a voluntary risk management tool. While some companies are reporting Scope 1 and Scope 2 emissions, they’re not required to report Scope 3,” Jones said, referring to emissions categories where Scope 1 is a company’s own direct emissions, Scope 2 comes from the electricity it buys, and Scope 3 covers emissions across its supply chain.
“All companies are not reporting all emissions,” he added.
Environmental advocates echoed Wiener and Jones, arguing that climate change demands full transparency from all major sectors of the economy and that carving out insurers would leave a significant source of climate risk and emissions in the dark.
In the end, the board members adopted the regulation with the insurer exemption but amended their resolution directing the staff to work with the Department of Insurance and revisit the insurance exemption and consider future rules if existing disclosure requirements are found to be insufficient.
This story was originally published February 27, 2026 at 4:20 PM with the headline "California air board OKs first rules for corporate climate disclosures."
