California’s SB 253, officially known as the Climate Corporate Data Accountability Act, is set to become one of the most significant climate disclosure regulations in the U.S. It requires large companies doing business in California to annually report their Scope 1, 2, and 3 greenhouse gas (GHG) emissions, starting in 2026.

If you’re a sustainability, compliance, or finance leader at a company with over $1 billion in global revenue, this blog is for you. We’ll walk you through everything you need to know to prepare for SB 253, including a step-by-step compliance checklist, key dates, assurance requirements, and links to additional guidance.

What Is SB 253?

Senate Bill 253 is a California law passed in October 2023. It mandates that large companies disclose their full GHG emissions footprint every year. These disclosures must be:

• Based on GHG Protocol standards
• Verified by an independent third-party assurance provider
• Made available via a public digital platform
  

The goal is to give regulators, investors, and consumers greater transparency into corporate emissions, especially Scope 3, which includes supply chain and product use emissions.

Who Needs to Comply?

You’re considered a “reporting entity” under SB 253 if:

• You’re a corporation, LLC, partnership, or similar entity
• You do business in California
• Your total annual revenue exceeds $1 billion, globally
  

Note: Even private companies are covered if they meet the above criteria.

Key Reporting Deadlines

Emission Type	First Reporting Year	Deadline
Scope 1 & 2	2026	TBD by CARB (expected mid-2026)
Scope 3	2027	180 days after Scope 1 & 2 deadline

CARB (California Air Resources Board) will finalize the exact reporting dates by January 1, 2025.

What Needs to Be Disclosed?

Each reporting entity must annually disclose:

• Scope 1 emissions – Direct emissions from owned/controlled sources (e.g. on-site fuel combustion)
• Scope 2 emissions – Indirect emissions from purchased electricity, steam, heating, or cooling
• Scope 3 emissions – All other indirect emissions, such as:
  
  • Purchased goods and services
  • Transportation and distribution
  • Business travel
  • Product use and disposal
    

Disclosures must be aligned with the Greenhouse Gas Protocol and clearly identify any assumptions, methodologies, or proxy data used.

What Are Scope 1, 2, and 3 Emissions

Scope 1

Direct emissions from sources you own or control — e.g. fuel burned in company vehicles, onsite boilers.

Scope 2

Indirect emissions from energy your company buys — e.g. electricity, steam, cooling.

Scope 3

All other indirect emissions in your value chain. These are often the largest — and most difficult to track.

Common examples include:

• Supplier emissions from raw materials
• Emissions from transporting goods to customers
• Customer product use (e.g. a sold appliance’s energy consumption)
  

How Will Reporting Be Verified?

SB 253 requires third-party assurance, with increasing rigor over time:

Year	Scope 1 & 2 Assurance Level	Scope 3 Assurance Level
2026	Limited	None (Voluntary)
2027	Limited	Voluntary (review underway)
2030	Reasonable	Limited

All assurance providers must:

• Be independent
• Demonstrate experience in GHG reporting
• Follow professional standards
  

SB 253 Compliance Checklist

Here’s what your internal teams need to start doing now.

1. Assess Applicability

• Confirm total annual revenue exceeds $1B
• Confirm operations or sales nexus in California
  

2. Assign Ownership

• Identify internal lead (usually Sustainability, ESG, CFO, or Risk)
• Set up cross-functional task force (Sustainability, Finance, Legal, Procurement, Ops)
  

3. Inventory Emissions

• Scope 1: Map direct emissions sources
• Scope 2: Pull energy use data
• Scope 3: Identify major categories (upstream + downstream)
  

4. Adopt GHG Protocol

• Use Corporate Standard for Scope 1 & 2
• Use Scope 3 Standard for indirect emissions
• Document assumptions, data sources, and estimation methods
  

5. Choose Emissions Data Platform

• Centralize data across business units
• Enable supplier data collection and validation
• Prepare audit trails and downloadable disclosures
  

6. Line Up Assurance Partner

• Engage with a qualified third-party assurance provider early
• Define scope and timelines for assurance reports
• Prepare documentation to support assurance level claims
  

7. Monitor CARB Updates

• Track CARB guidance and deadlines (regulations due Jan 1, 2025)
• Adapt internal roadmap accordingly
  

8. Budget for Compliance

• Allocate budget for:
  
  • Data management platform
  • Assurance costs
  • Annual filing fee to CARB (amount TBD)
    

Penalties for Non-Compliance

Starting in 2027:

• Up to $500,000 in annual fines for:
  
  • Failure to file on time
  • Incomplete or misleading disclosures (except Scope 3 errors made in good faith)
    

Note: Between 2027–2030, Scope 3 penalties apply only to non-filing, not errors.

Next Steps and How Sprih Can Help

Sprih works with climate and compliance teams across global companies to:

• Automate Scope 1, 2, and 3 data collection across all sites and suppliers
• Provide ready-to-assure GHG inventories with clear audit trails
• Manage reporting workflows in one platform
• Support Scope 3 estimations and data normalization
• Deliver disclosures aligned with SB 253 and GHG Protocol

If you’re working on your SB 253 roadmap, we’ve created a detailed prep checklist + implementation toolkit. Want access? Drop us a note at hello@sprih.com.

Final Word

SB 253 is not just another disclosure law — it’s a signal that climate data is now investor-grade data.

Start preparing now. The most successful companies will treat this not as a reporting burden, but as a catalyst for climate accountability and operational transparency.

Need help making sense of it all? Reach out to Sprih — we’d be happy to share what’s worked for others in your shoes.