Newsom to Sign Major California Corporate Climate Disclosure Bill

The State of California filed a lawsuit on Friday, People of the State of California v. Bill Oil, against the world’s biggest oil companies, alleging they are responsible for billions of dollars in damages for misleading the public by downplaying the risks of fossil fuels.

Sunday, while attending an event for Climate Week in New York, California Governor Gavin Newsom said he will sign new legislation — the Climate Corporate Data Accountability Act — that would require corporations earning $1 billion or more doing business in the state to disclose their carbon footprints in all parts of their supply chains, as well as in their investments, reported Common Dreams.

The governor said preserving California’s reputation as a climate leader was important.

“Would I cede that leadership by having a response that is anything but, ‘Of course I will sign that bill?’” Newsom told a reporter, as Common Dreams reported. “No, I will not.”

Newsom said there had been quite a bit of opposition to the bill, and that there was still some tweaking to do.

“We have some cleanup on some little language,” Newsom said, without providing any more details, as reported by Reuters.

Some international companies have expressed their support of the bill, including Microsoft and Apple.

“THIS IS HUGE!… Signing #SB253 into law is nothing short of historic. This piece of legislation is integral to our lowering our emissions and fighting the climate crisis,” California Environmental Voters said on X.

It is expected that the new legislation will apply to around 5,400 companies, Politico reported. The law requires more than federal climate disclosure rules proposed by the Securities and Exchange Commission, which apply exclusively to publicly traded companies without mandating all of them to report their Scope 3 supply chain emissions

The Climate Corporate Data Accountability Act requires complete Scope 3 disclosure for privately held companies as well.

“This is exactly the kind of policy framework that investors have long sought to better understand how companies are working to manage and mitigate the immense financial impacts of the climate crisis,” said Mindy Lubber, CEO and president of sustainability advocacy group Ceres, in a press release from Ceres. “Notably, the package also has the support from more dozens of leading businesses that recognize the massive opportunity of the shift to a low-carbon economy and deserve a standardized and consistent platform to showcase their efforts.”

The new bill could still face court challenges, some lawyers have said, reported Reuters.

The suit filed by California on Friday alleges that fossil fuel companies “have known for decades” that reliance on fossil fuels could cause climate change, but “they suppressed that information from the public,” The Hill reported.

Requirements for corporations to start reporting certain data on their greenhouse gas emissions under the Climate Corporate Accountability Act would begin sometime in 2026, while yearly reports on Scope 3 emissions would be required beginning in 2027, according to the text of the bill.