The Facts
On Saturday, California Gov. Gavin Newsom signed a new law requiring large businesses to start disclosing a range of greenhouse emissions starting from 2026.
17 states already require direct emissions to be disclosed by major emitters. The California Air Resources Board must set up a reporting system by Jan. 1, 2025.
The Spin
Narrative A
California is leading the way in a growing movement that is nudging Big Business to give investors a better idea of the climate risks they face. As cleaner energy becomes increasingly the norm, businesses that don't comply could face expensive litigation. This is great news as the world's "fifth-largest economy" rolls out this vital green policy.
Narrative B
This has all the potential to backfire on California. The burden and complexity of the new law are likely to force companies out of California to states with lighter regulations. The "one-size-fits-all" emissions rules unfairly lump various metrics together, making the following of these rules expensive.