What's Happening?
The Ninth Circuit has partially paused enforcement of California's Climate Related Financial Risk Disclosure Program (SB 261) pending an appeal. The program requires companies with revenues exceeding $500
million to publish biennial climate-related financial risk reports. The US Chamber of Commerce and other business groups challenged the law, arguing it violates the First Amendment. The court granted an injunction for SB 261 but denied it for SB 253, which mandates greenhouse gas emissions disclosure. The decision impacts the initial reporting deadlines, with oral arguments scheduled for January 2026. CARB is reviewing the order and providing guidance on compliance.
Why It's Important?
The Ninth Circuit's decision to pause enforcement of SB 261 highlights the ongoing legal challenges faced by climate disclosure laws in the U.S. The ruling could impact the implementation of similar laws across the country, affecting how businesses report climate-related risks and emissions. The legal challenges underscore the tension between regulatory efforts to address climate change and concerns over free speech and business interests. The outcome of the appeal could shape future climate policy and influence corporate transparency regarding environmental impacts.
