ESG

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. 

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.