The first reporting cycle under California’s “Climate Corporate Data Accountability Act” (SB 253) is fast approaching. SB 253 generally requires U.S.-organized entities doing business in California with more than $1 billion in total annual revenue to disclose their Scope 1, Scope 2 and Scope 3 greenhouse gas (GHG) emissions. The California Air Resources Board (CARB) has set November 10, 2026, as the initial reporting deadline for entities subject to SB 253’s requirements. Initial reporting in 2026 is limited to Scope 1 and Scope 2 emissions; Scope 3 reporting begins in 2027. In connection with the inaugural reporting deadline, we recommend companies focus on the implementation milestones that matter most for the 2026 reporting cycle and on preparing for the more rigorous reporting and assurance requirements expected to follow in 2027.

The following table provides a high-level summary of key SB 253 milestones and compliance deadlines:

We suggest reporting entities undertake the following actions now:

1. Confirm Scope and Reporting Structure

Companies should complete or refresh their applicability analysis, including identifying the legal entities that satisfy CARB’s California nexus and revenue tests and the entities that will be included in the 2026 submission. For corporate groups, this should include consideration of parent/subsidiary reporting arrangements and any acquisitions, dispositions or other structural changes that may affect the reporting perimeter. Companies should develop and maintain a documentary record supporting their applicability determinations rather than relying solely on CARB’s preliminary list of potentially covered entities.

2. Finalize the 2026 Emissions Inventory and Supporting Controls

Covered entities should move toward finalizing the Scope 1 and Scope 2 inventory that will support the first report. This includes documenting the organizational boundary, emissions sources, reporting period, calculation methodologies, emission factors, material assumptions and exclusions that entities have used in connection with preparing SB 253 reports. During a recent public workshop, CARB noted that GHG reporting is intended to align with the GHG Protocol and that while California-specific rulemaking will be implemented, the agency intends to preserve interoperability with other reporting frameworks (e.g., the European Union’s Corporate Sustainability Reporting Directive).

Companies should also use the initial reporting period to establish and implement a repeatable and auditable reporting process, including oversight and controls over data collection, calculations, management review, methodology baselines and changes and retention of supporting documentation.

3. Begin Preparing Now for Assurance and Scope 3

CARB’s first-year assurance flexibility should not delay preparations for 2027. Reporting entities should consider conducting an assurance-readiness assessment, evaluating potential independent assurance providers and determining whether their existing data, documentation and controls are sufficient to support limited assurance. In addition, reporting entities also should begin preparing for Scope 3 reporting. While CARB’s 2027 reporting guidance is not final, entities can begin by mapping reporting requirements for 2027, prioritizing the five categories CARB currently proposes to require initially, identifying data owners and value-chain data sources and developing methodologies to address data gaps.

4. Reconcile SB 253 Reports with Other Disclosures

Before reporting, entities should compare the SB 253 inventory against other climate and emissions disclosures, including sustainability reports, Carbon Disclosure Project submissions, climate targets, Securities and Exchange Commission filings and other regulatory reporting. Differences in boundaries, methodologies or reported figures may be appropriate, but they should be understood, documented and, where necessary, explained.

SB 253 Compliance Checklist

We have created an SB 253 compliance checklist for entities to evaluate reporting obligations under SB 253 and, if required, the action items we suggest it consider as SB 253 reports are prepared for publication.

Applicability and Reporting Structure

• Confirm the U.S.-formed entities potentially subject to SB 253.
• Confirm California nexus and the applicable revenue threshold (i.e., more than $1 billion in annual revenue).
• Document entity-level applicability conclusions.
• Determine whether covered subsidiaries will report separately or through a parent-level submission.
• Identify acquisitions, dispositions or other changes affecting the reporting perimeter.

2026 Emissions Reporting

• Confirm the applicable reporting period.
• Define and document the organizational boundary.
• Complete the Scope 1 and Scope 2 inventory.
• Document calculation methodologies, emission factors, assumptions and material exclusions.
• Assess whether existing GHG reporting can be leveraged.
• Retain underlying data, calculations and supporting documentation.
• Document material data gaps and any reliance on CARB’s first-year good-faith flexibility.

Governance and Controls

• Assign responsibility across sustainability, finance, legal and relevant control functions.
• Establish oversight, review and approval procedures.
• Document controls over data collection, calculation and consolidation.
• Establish procedures for methodology changes and corrections.
• Reconcile SB 253 reporting against other public climate and emissions disclosures.
• Preserve the final filing and supporting record.

Assurance and 2027 Readiness

• Assess whether current Scope 1 and Scope 2 processes are ready for limited assurance.
• Identify and evaluate potential independent assurance providers.
• Review provider independence and potential conflicts.
• Build sufficient time for limited assurance into the 2027 reporting calendar.
• Map GHG Protocol Scope 3 categories, including the five prioritized by CARB.
• Identify internal data owners and significant value-chain data sources.
• Develop and document methodologies for Scope 3 data gaps.

Near-term Filing Readiness

• Monitor final approval of the expected November 10, 2026, filing deadline.
• Review CARB’s forthcoming implementation guidance and reporting-platform instructions.
• Confirm internal responsibility for submitting the report.
• Complete appropriate management and legal review.
• Address applicable fees and other administrative requirements.

Bottom Line

For entities already familiar with SB 253, the immediate priority is execution. The remaining 2026 implementation period should be used to finalize the reporting perimeter and Scope 1 and Scope 2 inventory, establish a defensible control environment and prepare for the transition to assurance and Scope 3 reporting in 2027. The first filing may be comparatively flexible, but the processes reporting entities establish now are likely to become the foundation for a considerably more rigorous annual reporting regime.

We have written extensively regarding SB 253. Here is our previously published content on this topic.

1 CARB has indicated that it intends to retain the November 10th deadline for annual reports; however, that remains subject to final rulemaking by the agency.

2 During its public workshop on July 21, 2026, CARB identified the assurances standards that may be used by assurance providers for SB 253 reports. That information may be found here.