California May budget proposal must prioritize complete implementation of landmark climate disclosure laws

California Gov. Gavin Newsom’s proposed 2024-2025 budget has paused all funding for implementation of newly signed laws, including the state’s nation-leading climate disclosure policies that passed into law in 2023. In the coming months, Ceres calls on legislative leaders and the Governor’s Office to work together to fully fund the work of the California Air Resources Board (CARB) to oversee the Climate Accountability Package in the final budget. 

“Companies and investors cannot afford any delay in the implementation of California's landmark climate disclosure laws. Not only do investors, consumers, and other stakeholders deserve better information about companies' climate-related financial risks and impacts, but businesses themselves deserve the standardized, consistent, and economywide disclosure rules that this legislation promises,” said Steven Rothstein, managing director of the Ceres Accelerator for Sustainable Capital Markets. “Ceres believes it is imperative that full funding for both laws is included in the May budget. We look forward to working with lawmakers and Governor Newsom throughout the budget process to secure funding that ensures the full and timely implementation of this legislation." 

Collectively known as the Climate Accountability Package, SB 253 and SB 261 will require thousands of large companies from across the U.S. to report pollution that is dangerously warming the planet from across their supply and value chains, as well as the risks they face from the effects of the climate crisis. However, failure to fund CARB’s work would effectively delay the laws’ implementation.  

A long-time supporter of corporate climate disclosure, Ceres was a co-sponsor of the two historic bills which were a priority of investors and consumer groups that demand more information into how businesses are managing the severe economic, business, and public health impacts of the climate crisis. 

Importantly, SB 253 and SB 261 also won key support from major businesses that will themselves be required to report their emissions and climate risks. In 2023, more than 30 companies, institutions, and industry groups publicly advocated for passage of one or both laws — including Apple, Google, Salesforce, Microsoft, Sierra Nevada Brewing, Adobe, Atlassian, IKEA USA, Palo Alto Networks, REI Co-op, and several clothing industry groups such as the American Apparel & Footwear Association. 

Many leading businesses already report their emissions and climate-related risks to investors, demonstrating that climate disclosure is feasible for companies of all sizes. The California policies will ensure standardized and consistent disclosure rules that apply across the entire economy and provide businesses with an opportunity to showcase their work managing climate pollution and its impacts to consumers and investors. 

About Ceres

Ceres is a nonprofit organization working with the most influential capital market leaders to solve the world’s greatest sustainability challenges. Through our powerful networks and global collaborations of investors, companies and nonprofits, we drive action and inspire equitable market-based and policy solutions throughout the economy to build a just and sustainable future. For more information, visit ceres.org and follow @CeresNews.