U.S.: California Air Resources Board Holds Public Workshop on Climate Disclosure Laws

On May 29, 2025, the California Air Resources Board (“CARB”) convened a virtual public workshop with key stakeholders to discuss the implementation of California’s new climate disclosure mandates—the Climate Corporate Data Accountability Act (SB 253) and the Climate-Related Financial Risk Act (SB 261). At the workshop, CARB confirmed that the deadlines for disclosure under SB 253 and SB 261 remain as set out in the statute, beginning in 2026, but announced that the implementing regulations, initially due by July 1, 2025, will be provided by the end of the year.

These laws will require thousands of companies “doing business in California” to publicly disclose their greenhouse gas (“GHG”) emissions and climate-related financial risks. Under SB 253, reporting for Scopes 1 and 2 emissions will be required in 2026, and Scope 3 emissions will follow in 2027. SB 261 data will be due on January 1, 2026. For more information and considerations for compliance, please see our Debevoise Update on the topic.

While the implementing regulations will be delayed, the workshop addressed key implementation issues, stakeholder concerns and the alignment of California’s regulations with emerging federal and international frameworks. At the workshop, CARB considered the open question related to the definition of “doing business in California” indicating that the definition in the state’s tax code (RTC Section 23101) is workable with minor modification. Discussions also included the technical complexity of reporting Scope 3 emissions (i.e., indirect emissions from a company’s supply and value chains) under SB 253, with stakeholders expressing concerns about the availability and reliability of upstream and downstream emissions data. In response, CARB noted that it is considering phased implementation timelines and safe harbor provisions, particularly during the early years of reporting. Stakeholders and CARB also discussed the need for harmonizing disclosure regimes, including as between the United States and the EU, with CARB reaffirming its commitment to promoting global interoperability and minimizing duplication in reporting requirements for businesses.

CARB indicated during the workshop that it would continue to engage with stakeholders during the development of the regulations. Companies should stay tuned for further insights on key open issues.

Link:
CARB Workshop Slides

EU: European Commission Proposes Delay to Reporting Standards Under CSRD

On May 22, 2025, a leaked draft EU Delegated Regulation proposed postponing certain reporting requirements under the EU Corporate Sustainability Reporting Directive (the “CSRD”). The draft is part of the European Commission’s Simplification Omnibus Package aiming to reduce overall administrative burdens for EU companies by at least 25%, and is separate from the “Stop-the-Clock” Directive, which has already delayed for two years the application of CSRD requirements for large private companies and listed SMEs from 2025 to 2027 and 2026 to 2028, respectively. The largest companies in scope of the CSRD (large public-interest entities and issuers on an EU-regulated market with more than 500 employees) are already subject to its reporting obligations.

The CSRD requires companies in scope to report sustainability information according to the European Sustainability Reporting Standards (the “ESRS”). The ESRS include phased-in disclosure requirements, meaning that companies in scope only need to report certain information as from the second or third year of reporting. The draft EU Delegated Regulation would postpone these ESRS reporting requirements by two years. The Explanatory Memorandum to the Delegated Regulation justifies the postponement on the basis that “by the time that [companies] have to report for financial year 2027, it is expected that the overall revision and simplification of ESRS will have been completed, and that the Directive amending the substantive provisions of the CSRD, including the provisions setting out which undertakings are subject to the reporting requirements, will have entered into force.”

Beyond delaying its implementation, the EU is also considering substantive amendments to simplify and streamline the CSRD. Other proposed changes include raising the threshold of companies in scope of the CSRD and substantially reducing the number of mandatory ESRS datapoints. For more on the Omnibus Package, see our Debevoise In Depth on the topic here.

Link:
Draft EU Delegated Regulation (leaked copy)

EU: Ombudswoman Opens Inquiry into How European Commission Prepared Its Legislative Proposals in Omnibus Package

On May 22, 2025, European Ombudswoman Teresa Anjinho opened an inquiry into the European Commission’s (the “Commission”) preparation of the Omnibus package of legislative proposals to simplify the Corporate Sustainability Reporting Directive and the Corporate Sustainability Due Diligence Directive (to read more about the Omnibus package, see our Debevoise In Depth note here).

The inquiry follows a complaint made on April 18 by eight civil society organizations, including Friends of the Earth and Notre Affaire A Tous, who argued that, in proposing the Omnibus package: (i) the Commission failed to carry out a public consultation and impact assessment without justification, as required under its Better Regulation Guidelines; and (ii) the Commission failed to conduct a climate consistency assessment, as required under Art. 6.4 of the European Climate Law, to ensure that all legislative proposals are consistent with the EU’s climate-neutrality objectives and other climate-related targets.

As a first step, the Ombudswoman asked the Commission to provide information by June 6 on its decision to not carry out the required consultation and assessments. An inspection and meeting between the Ombudswoman and the Commission is expected to take place before June 18.

Links:
European Ombudsman - Announcement
Better Regulation Guidelines
Regulation (EU) 2021/1119 of the European Parliament and of the Council (European Climate Law)

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