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.

At a Glance: Key Differences

Feature	SB 253 (CA)	SB 261 (CA)	SEC Climate Rule
Type of Rule	GHG Emissions Disclosure	Climate Risk Disclosure	Emissions + Risk (financial filings)
Applies To	Companies >$1B revenue doing business in CA	Companies >$500M revenue doing business in CA	U.S. public companies
Scopes Covered	Scope 1, 2 (assured), Scope 3 (later)	Climate-related financial risks (TCFD-based)	Scopes 1, 2 (assured), Scope 3 (some cases); risk and financial impacts
Assurance	Yes — phased in by 2030	No	Yes — limited, with phase-in
Reporting Frequency	Annually	Biennially	Annually (in 10-K, registration)
Reporting Format	Public website + CARB portal	Public website	SEC filings (10-K, registration)

Applicability: Who Must Report Under Each Rule?

SB 253

Companies with > $1 billion in annual revenue
Must do business in California
Both public and private firms included

SB 261

Companies with > $500 million in annual revenue
Also must do business in California
Excludes insurers (regulated separately)

SEC Climate Rule

Public companies only
Applies to all filers, but phased in by size
No specific revenue threshold

Takeaway: A large private company that isn’t publicly traded may still be fully covered by SB 253 and SB 261, but not by the SEC rule.

What’s Required Under SB 253 and SB 261

SB 253 – GHG Emissions Reporting

Disclose Scope 1 and Scope 2 emissions annually
Scope 3 required from 2027 (assurance required by 2030)
Submit to California Air Resources Board (CARB)
Third-party assurance is mandatory

SB 261 – Climate Risk Disclosure

Disclose material climate-related financial risks
Follow TCFD-aligned framework (or IFRS S2 equivalent)
Describe strategies to reduce/adapt to risk
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.

👉 Request a demo

FAQs

Is SB 253 stricter than the SEC rule?

Yes — especially on Scope 3 emissions. SB 253 mandates Scope 3 disclosures starting in 2027 and requires third-party assurance by 2030. The SEC rule only requires Scope 3 if it’s deemed material or part of public climate targets, and doesn’t mandate assurance for it.

Can one report meet both SEC and SB 261 requirements?

Yes, if it follows a TCFD- or IFRS S2-aligned format. SB 261 explicitly allows equivalent disclosures under recognized frameworks. A well-structured climate risk report can meet both state and federal expectations.

Does the SEC require Scope 3 data?

Only in certain cases. Scope 3 reporting is required under the SEC rule only if the emissions are material to investors or included in your public emissions targets. In contrast, SB 253 makes Scope 3 disclosure mandatory for all covered companies starting in 2027.

Who enforces these rules?

SB 253 and SB 261 are enforced by the California Air Resources Board (CARB). The SEC rule is enforced by the U.S. Securities and Exchange Commission. Companies subject to both must coordinate compliance across two regulatory bodies.