California has passed two climate laws — SB 253 and SB 261 — that go beyond the SEC’s federal disclosure rule in scope and applicability. If your company does business in California and meets the revenue thresholds, you may be subject to both.
This post explains how these rules differ, where they overlap, and what your compliance roadmap should look like if you’re navigating both at once.
Must publish report on company website every two years
What the SEC Climate Rule Covers
The SEC rule (finalized in March 2024) requires:
Disclosure of climate-related risks likely to materially impact operations, strategy, or financials
GHG emissions reporting (Scope 1 & 2 mandatory for large filers)
Scope 3 disclosure only if material or included in climate targets
Integration of climate data in 10-K filings
Limited assurance for Scope 1 and 2 phased in over time
Assurance Requirements Compared
Scope
SB 253
SB 261
SEC Rule
Scope 1 & 2
Required (limited → reasonable)
Not applicable
Required for large filers (phased)
Scope 3
Required from 2027; assurance from 2030
Not applicable
Only if material or target-linked
Climate Risk Disclosures
Not applicable
No third-party required
Internal review; no third-party mandate
SB 253 is stricter in the long run, especially with Scope 3 assurance becoming mandatory — a first globally.
Disclosure Deadlines
Rule
First Reporting Year
First Submission Deadline
SB 253
2025 data
2026
SB 261
2025 data
2026
SEC Rule
2025 data (for large accelerated filers)
2026 (10-K filing)
Companies affected by all three may need parallel workflows to meet both federal and California-specific deadlines.
What Dual Compliance Means for You
If you’re a public company with over $1B in revenue and operations in California, here’s what you’re facing:
SB 253 requires GHG disclosures (with assurance) SB 261 requires climate risk reporting (TCFD-aligned) SEC expects emissions and financial risk info embedded in annual filings
This isn’t duplication — it’s a multi-layered compliance stack. And that’s a shift in how ESG data gets treated.
You’ll need:
Unified data architecture to serve both state and federal needs
Assurance readiness across Scope 1, 2, and (eventually) Scope 3
Cross-functional alignment across finance, legal, risk, and sustainability teams
How Sprih Helps You Stay Ahead
We’ve designed Sprih’s platform to simplify dual compliance.
Here’s how:
One system for emissions and risk data — mapped to both CARB and SEC needs
Assurance-ready reports with full audit trails
TCFD and IFRS S2 alignment built into the risk module
Flexible exports for website publishing, SEC filings, and CARB submission
Need to file with the SEC, publish under SB 261, and comply with SB 253 — all in one year? Sprih helps you do it without doubling the work.
FAQs
What are the main differences between California’s climate disclosure laws and the SEC’s federal climate rule?
California’s laws (SB 253 and SB 261) require emissions and risk disclosures regardless of materiality and apply to both public and private companies doing business in California. The SEC’s rule applies only to public companies, includes materiality thresholds for Scope 1 and 2 emissions, and does not require Scope 3 unless tied to climate targets. Assurance requirements and reporting formats also differ.
Which companies does SB 253 apply to compared to the SEC climate rule?
SB 253 targets any company—public or private—with over $1 billion in revenue doing business in California. The SEC climate rule applies only to U.S. public companies, phased in based on market capitalization rather than revenue thresholds.
How does SB 261 differ from the SEC rule in risk disclosure expectations?
SB 261 mandates biennial climate-related financial risk reporting aligned with the TCFD framework for companies with over $500 million in revenue in California. The SEC rule requires annual risk disclosures in regulatory filings, but with broader qualitative metrics tied to material risk. SB 261 does not require the same level of governance or strategy detail as the SEC rule.
What emissions scopes are required under SB 253 and how does that compare to SEC requirements?
SB 253 requires disclosure of Scope 1, Scope 2, and Scope 3 emissions, with phased assurance requirements. The SEC rule mandates Scope 1 and Scope 2 emissions reporting when material; Scope 3 emissions are optional unless included in a climate target.
Are third‑party assurances required under both regimes?
Yes under SB 253: limited assurance for Scope 1 and 2 starting in 2026 and reasonable assurance by 2030, with Scope 3 assurance required by 2030. Under the SEC rule, assurance is proposed for Scope 1 and 2 over time, but California’s SB 261 does not mandate assurance for risk reports.
When are the first reporting deadlines for SB 253, SB 261, and the SEC rule?
SB 253 and SB 261 require reporting based on 2025 fiscal year data, to be filed in 2026. The SEC rule similarly starts in 2026 for large accelerated filers reporting 2025 emissions and risk disclosures in their 10‑K or registration filings.
What compliance implications arise for companies subject to both California laws and the SEC rule?
Companies covered by both California and federal rules may face parallel reporting obligations: SB 253 emissions via CARB portal, SB 261 risk reports on their website, and SEC climate disclosures in annual filings. They must manage potential overlap and ensure that data formats, thresholds, and assurance standards align or are reconciled across regimes.
