The California Air Resources Board (CARB) wields the power to levy fines up to $500,000 per annum for transgressions. A distinctive feature of this law is its application to both public and private entities, contrasting with the U.S. Securities and Exchange Commission’s proposed climate disclosure rule, which confines itself to public corporations.
Proponents laud this law as a beacon of transparency, enabling regulatory authorities, investors, and consumers to hold companies accountable for their carbon footprint. Governor Newsom, however, voiced concerns about the law’s viability. He cited potentially unattainable implementation deadlines and the risk of erratic reporting standards.
Gray Areas and Legal Challenges
In the legal realm, California’s climate disclosure law emerges with gray areas that industry experts anticipate the CARB will address. The intricacies of revenue definitions, including whether global earnings fall within the law’s purview or what constitutes ‘doing business’ in California, have stirred perplexity.
