Lessons Learned From Preparing for California’s Climate Bills 

As public and private companies accelerate their efforts to comply with SB 253 and SB 261, one thing is clear: Climate disclosure is no longer a theoretical exercise. Regulatory expectations are months away. 

The California Air Resources Board (CARB) has provided early-stage flexibility, stating “best faith efforts” will be sufficient in the first year of reporting. While this provides some relief, it also underscores the importance of using this initial period to lay a strong foundation for credible, long-term compliance. 

Based on our ESG reporting experience supporting companies with SB 253 and SB 261 compliance, several key lessons have emerged. 

Lesson 1: Establish a Foundation With a Forward-Looking Plan 

Companies making the most meaningful progress understand the first year is not the finish line – it’s the starting point. Success in year one depends on both foundational action and a clearly articulated plan for future compliance. 

Several core activities have proven essential: 

• Conduct an initial climate risk assessment to assess any financial material impacts on your organization. For many companies, full quantification or climate scenario analysis won’t be feasible right away. A thoughtful qualitative review throughout your operations and company strategy still demonstrates that you’re asking the right questions and making best faith efforts. 
• Document a forward-looking roadmap. Codify how you’ll advance your risk analysis and other disclosures over time. 
• Establish Scope 1 and 2 greenhouse gas emissions baselines. These are often the most accessible metrics, as well as the most critical metrics to guide future action. 
• Build institutional readiness. Set up basic reporting workflows, establish a cross-functional team to represent the interests of internal and external stakeholders, and develop accountability structures now to avoid scrambling later. This work lays the foundation for year two, year three, and beyond. 

For companies subject to SB 261, the 2-year period following initial disclosures presents a unique opportunity to demonstrate progress. Capitalizing on that timeframe requires structured planning now, not later. 

Lesson 2: Governance and Strategy Are Critical Enablers 

Disclosure isn’t just about data; it’s about ownership, strategy, and decision-making. 

Establishing clear governance early helps avoid confusion and rework later. Basic questions matter: Who owns climate risk? How are decisions made? How often is progress reviewed? Do we have mitigation plans? 

Your strategy should also link directly to business value: 

• Risks: Commodity price volatility, supply chain disruptions, customer demands. 
• Opportunities: Energy efficiency, greenhouse gas emissions reductions, cost savings. 

When climate considerations are integrated into core business strategy, the benefits go beyond compliance. Companies see greater efficiency, stronger cross-functional collaboration, and clearer prioritization of resources, ultimately spending less time on reactive disclosures and more time on value-generating activities. 

Lesson 3: Don’t Let Perfection Get in the Way: Start with What’s Practical and Use the Right Tools 

For many companies, this is the first formal climate reporting requirement they’ve encountered. While gaps and uncertainties are expected, delaying action until everything is fully resolved isn’t effective. 

CARB’s “best faith” flexibility in year one is intended to encourage action, not inaction. What matters most is taking the first step – even if every element isn’t yet fully developed – such as making reasonable and supportable assumptions, clearly documenting your current state and any known gaps, and outlining a realistic and phased plan for improvement over time. 

For companies building disclosures from scratch or looking to create greater efficiencies in their regulatory compliance process, AI tools can be a valuable accelerator. AI-enabled platforms can support: 

• Data collection and extraction.  
• GHG calculations and analytics based on accepted methodologies. 
• Drafting disclosures and narrative reporting aligned with regulatory frameworks. 

Used appropriately, AI can help reduce manual lift and allow lean teams to meet their obligations with greater confidence and speed. 

Lesson 4: Resource Allocation 

Climate disclosure requirements are evolving, not just in California, but globally. With CSRD shifting following the Omnibus legislation and the SEC dropping its defense of its climate disclosure rules earlier in the year, many companies are struggling to plan and resource appropriately. 

This uncertainty is placing additional pressure on already lean teams. Legal, finance, and operations leaders are being asked to take on sustainability reporting responsibilities, often without added capacity or expertise. That’s why effective resource allocation is a strategic enabler that can help organizations meet regulatory requirements, enhance transparency, build stakeholder trust, and reduce compliance risk 

Taking the Next Step to California Climate Compliance 

CrossCountry Consulting empowers companies to adapt swiftly and strategically. Whether you’re building a climate risk program from the ground up or enhancing existing processes, we provide the structure, insight, and support needed to move forward with clarity and confidence. 

For private companies, we offer tailored guidance to navigate California’s climate legislation while maintaining discretion and honoring internal context. Our approach meets you where you are – ensuring compliance without overexposure. 

To establish and execute a climate reporting roadmap aligned with California’s Climate Bills, connect with CrossCountry Consulting.