It will be important to the comment process for commenters to submit their views on the Proposal. A well-developed administrative record—including from those who support the Proposal—helps inform the Commission’s deliberations and supports the durability of any final action.
Environmental/Climate Change
Gibson Dunn ESG: Risk, Litigation, and Reporting Update (April 2026)
We are pleased to provide you with Gibson Dunn’s ESG Risk, Litigation, and Reporting update covering the following key developments during April 2026. Please click on the links below for further details.
Gibson Dunn ESG: Risk, Litigation, and Reporting Update (March 2026)
We are pleased to provide you with Gibson Dunn’s ESG Risk, Litigation, and Reporting update covering the following key developments during March 2026. Please click on the links below for further details.
California Announces It Will Not Enforce Climate-Related Risk Reporting Law (SB 261)
As previously reported, California’s SB 261 would have required U.S. companies (public and private), other than insurers, with more than $500 million in annual revenue that do business in California to publish their first climate-related financial risk report on or before January 1, 2026. See California’s Health and Safety Code Section 38533 (as adopted by Senate Bill 261 and subsequently amended).
This is no longer the case:
- On November 18, 2025, the U.S. Court of Appeals for the Ninth Circuit enjoined the law pending an appeal by a coalition of leading business organizations challenging its constitutionality in the ongoing legal proceeding. The case is Chamber of Commerce of the United States et al. v. Sanchez et al., No. 25-5327 (9th Cir.).
- On December 1, 2025, the California Air Resources Board (“CARB”), the state agency responsible for enforcing SB 261, responded to the injunction by posting an enforcement advisory stating it would not enforce the law “against covered entities for failing to post and submit reports by the January 1, 2026, statutory deadline.” Instead, CARB “will provide further information—including an alternate date for reporting, as appropriate—after the appeal is resolved.”
This advisory resolves any question as to whether the court’s injunction applied only to the parties to the case and their members by stating that all in-scope companies are no longer expected to publish a climate-related risk report by the original January 1, 2026 deadline. CARB has posted a docket and instructions for companies who nonetheless wish to voluntarily submit a report.
SEC Signals Potential Strategy Shift in Climate Disclosure Rule Litigation
On Tuesday, Mark Uyeda, Acting Chairman of the Securities and Exchange Commission (the “SEC”), issued a statement signaling potential updates to the SEC’s position in the ongoing legal challenges to its climate disclosure rule. As previously reported, the SEC stayed its climate disclosure rule last year pending the outcome of the related consolidated litigation before the Eighth Circuit Court of Appeals.
SEC Staff Reinstates Traditional Approach to Interpreting the Shareholder Proposal Rule; New Guidance Rescinds SLB 14L
To Our Clients and Friends:
On February 12, 2025, the Division of Corporation Finance (the “Staff”) of the U.S. Securities and Exchange Commission (the “Commission”) published Staff Legal Bulletin No. 14M (“SLB 14M”), which sets forth Staff guidance on shareholder proposals submitted to publicly traded companies under Exchange Act Rule 14a-8. SLB 14M rescinds Staff Legal Bulletin No. 14L (“SLB 14L”) (which was issued in November 2021) and addresses a number of interpretive issues in a manner that draws heavily from prior statements by the Commission interpreting Rule 14a-8.
California Solicits Input On—and Issues Enforcement Update For—Future Climate Reporting
Request for Comments. On December 16, 2024, the California Air Resources Board (“CARB”) issued a request for public feedback and information regarding certain implementing regulations for Senate Bill (“SB”) 253 (the Climate Corporate Data Accountability Act) and SB 261 (the Climate-Related Financial Risk Act). As a reminder, SB 253 requires U.S. companies doing business in California with annual revenues over $1 billion to begin reporting Scope 1 and 2 greenhouse gas (“GHG”) emissions in 2026 and Scope 3 GHG emissions in 2027. SB 261 requires U.S. companies doing business in California with annual revenues over $500 million to biennially report on climate-related risks and their steps to mitigate such risks, with the first report due on or before January 1, 2026. Both SB 253 and SB 261 make CARB responsible for the laws’ enforcement and for adopting certain implementing regulations.
Preparing for California’s Climate Reporting Legislation – Takeaways from Recent Amendments and Early AB 1305 Reporting Trends
Last year, California adopted a trio of laws requiring certain public and private companies to provide climate-related disclosures. As a quick refresher:
- Climate Corporate Data Accountability Act (Senate Bill 253). For U.S. companies doing business in California with annual revenues over $1 billion, Senate Bill (“SB”) 253 requires them to report their greenhouse gas (“GHG”) emissions annually beginning in 2026 (for Scope 1 and 2 GHG emissions) and 2027 (for Scope 3 emissions).
- Greenhouse Gases: Climate-related Financial Risk (Senate Bill 261). For U.S. companies doing business in California with annual revenues over $500 million, SB 261 effectively requires them to begin biennial reporting in 2025 regarding their “climate-related financial risks” and adopted measures to reduce or adapt to them.
- Voluntary Carbon Market Disclosures (Assembly Bill 1305). For companies that make certain environmental claims, adopt particular environmental goals, or purchase, use, market, or sell voluntary carbon offsets in California, Assembly Bill (“AB”) 1305 requires annual website disclosure providing support for those claims, goals, or offsets.
Preparing for CDP’s New Sustainability Reporting Platform
Earlier this month, CDP (formerly known as the Carbon Disclosure Project) announced the launch of a new environmental disclosure platform. CDP is a non-profit that scores and assesses participating companies and cities, states, and regions on climate, deforestation, and water security topics. According to CDP, over 23,000 companies (representing two-thirds of global market capitalization) disclosed through CDP in 2023.
Eighth Circuit Establishes Briefing Schedule for SEC Climate Disclosure Rules Litigation
On May 20, 2024, the U.S. Court of Appeals for the Eighth Circuit issued an order establishing the briefing schedule for the consolidated litigation challenging the Securities and Exchange Commission’s (“SEC") final climate disclosure rules.