CARB draft checklist for SB 261 disclosures

The California Air Resources Board (CARB) has posted a draft checklist to assist reporting entities in preparing Climate-Related Financial Risk Reports under Senate Bill SB 261 (HSC § 38533).

• Main announcement/action: CARB provides a draft checklist and clarifications for the Climate Related Financial Risk Disclosure Program applying to U.S. companies doing business in California with annual revenues in excess of $500 million, requiring biennial public disclosure of climate-related financial risk beginning with the initial report due January 1, 2026. CARB will open a public docket on December 1, 2025 for reporting entities to post the URL of their initial report; the docket will remain open through July 1, 2026.
• Background and details: The guidance identifies acceptable reporting frameworks (TCFD, IFRS S2, or reports meeting regulated exchange/national government requirements), notes the insurance exemption (entities regulated by the California Department of Insurance or in the business of insurance elsewhere are not “covered entities”), clarifies flexibility on calendar vs fiscal year data (use most recent/best available), allows parent-level consolidated reporting for subsidiaries, and states the checklist is guidance only and does not supersede statute or future CARB regulations.