California is leading a climate accountability revolution and 2026 is the year of change
Last updated on February 21, 2026 | 7 min read
Starting from 2026, large companies operating in California must publicly disclose their greenhouse gas emissions. This reporting is no longer voluntary. Under Senate Bill 253 (SB-253), also known as the Climate Corporate Data Accountability Act, companies must provide mandatory, regulated, and auditable climate disclosure that treats carbon data with the same rigor as financial statements.
Who Does SB-253 Apply To?
The regulation applies to all public and private companies with annual revenues exceeding 1 billion dollars that operate in California, regardless of where they are headquartered. For organizations that meet these criteria, the countdown to compliance has already begun.
Key Milestones for California’s Climate Disclosure Law
Starting in 2026, California’s SB-253, the Climate Corporate Data Accountability Act reshapes how large companies measure, verify, and disclose their greenhouse gas emissions. If your organization operates in California and meets the $1 billion revenue threshold, the countdown to compliance is already underway. Here’s what to expect and how to prepare.
2025: Preparation Year
2025 was the window to prepare for what’s coming. This was the year to establish systems, map data sources, and identify data owners across sustainability, finance, procurement, and operations. Clearly defining where your Scope 1 and 2 emission data originate sets the foundation for accurate, auditable reporting.
2026: Scope 1 and 2 Disclosures Begin
In 2026, companies must publicly disclose their Scope 1 (direct emissions) and Scope 2 (indirect energy-related emissions) data for the previous year. Each submission must be verified through a third-party assurance process before being sent to the California Air Resources Board (CARB) registry.
2027: Scope 3 Emissions Added
By 2027, the disclosure requirement expands to include Scope 3 emissions, covering upstream and downstream supply chain activities. Organizations will need to demonstrate not only accurate data collection but also consistent methodologies and strong engagement with suppliers to ensure reliability.
Why SB-253 Represents a Global Shift
SB-253 doesn’t stand alone. It aligns closely with the EU’s Corporate Sustainability Reporting Directive (CSRD) and the U.S. SEC’s proposed climate disclosure rule. Together, these frameworks mark a significant global shift, treating climate data with the same rigor and traceability as financial reporting. Once fully implemented, California will host one of the world’s first mandatory, economy-wide carbon disclosure registries. Its example will likely influence national and international standards for years to come.
Overcoming the Compliance Challenges
Organizations now face three major roadblocks on the path to SB-253 readiness:
Fragmented data sources: Emission data is scattered across ERP, procurement, and utility systems. Manually combining these creates significant risk and inefficiency.
Manual tracking errors: Spreadsheets lead to duplication, missing context, and costly mistakes under audit.
Assurance complexity: Independent assurance mandated by SB-253 demands transparent data lineage, something most legacy systems can’t deliver.
Your SB-253 Readiness Checklist
A strong compliance plan covers six critical areas:
Governance and Ownership: Assign an internal SB-253 lead and align sustainability and finance functions. Form a cross-functional task force and secure executive buy-in for necessary system upgrades.
Data Mapping and Boundaries: Identify Scope 1 and 2 sources, define organizational boundaries, and prepare for Scope 3 outreach.
Systems Integration: Ensure emission data flows from ERP, utilities, and suppliers into a central repository. Validate that your tools can generate CARB-ready outputs in aligned formats.
Audit Trail and Data Assurance: Implement version control, source referencing, and change logs. Link every data point to its original source and establish internal data-review checkpoints.
Reporting Framework: Align with GHG Protocol and CARB-defined templates. Maintain year-over-year consistency and document methodologies to support comparability.
Assurance Partner: Choose a CARB-approved third-party assurance provider early to avoid delays.
Moving Beyond Spreadsheets
Traditional monitoring methods can’t meet SB-253’s data accuracy and assurance demands. Many companies still rely on basic spreadsheets or outdated ESG platforms that lack full audit trails and integration capabilities. To stay compliant, organizations must invest in solutions built for verified carbon accounting, automating data ingestion, validation, and reporting. Platforms like Triple I’s AI-powered system streamline compliance, producing audit-ready reports that integrate smoothly into existing ecosystems.
Take Action Now
The first reporting deadline arrives sooner than it seems. Companies that take proactive steps will lead their business activities with the confidence, data systems, and assurance processes needed to comply.
Ready to evaluate your progress? Download our full SB-253 readiness checklist and white paper to access a step-by-step guide for preparing your organization for this historic shift in corporate climate accountability.
