On February 26, 2026, CARB adopted initial regulations to implement SB 261 and SB 253.

As a reminder, starting in 2026, business entities organized under U.S. law, doing business in California, and with annual revenues over $500M may be required by SB 261 to make biennial disclosures regarding their climate-related financial risk, and those with annual revenues over $1B will be required by SB 253 to make annual disclosures of their greenhouse gas emissions.

The regulations establish, among other things: 

• August 10, 2026, as the initial reporting deadline for Reporting Scope 1 and Scope 2 emissions under SB 253;

• Where a reporting entity's fiscal year ends after February 1, the applicable preceding fiscal year for the purposes of reporting under SB 253 as the fiscal year ending in the previous calendar year (however, the reporting entity may choose to use its most recent fiscal year); 

• Exemptions for certain entities, including nonprofits and charitable organizations; 

• The revenue threshold for determining whether an entity is subject to the statutes as the lesser of the entity’s two previous fiscal years of revenue, and that "revenue" has the same meaning as “gross receipts” in California Revenue and Taxation Code section 25120(f)(2);

• The definition of “doing business in California” as actively engaging in any transaction for the purpose of financial or pecuniary gain or profit, and either (1) being organized or commercially domiciled in California or (2) sales (excluding sales of wholesale electricity) exceeding the lesser of the amount set by Franchise Tax Board (which was $735,019 in 2024) or 25 percent of total sales; and

• A framework for SB 261 and SB 253 implementation fees.

The regulations are available here, and additional information related to CARB's adoption of the regulations is available here.