Diving into the Climate Reporting Regulations in the United States

From California to the SEC, climate disclosure is becoming a business imperative. Join Catherine Beare and Beth Mielbrecht as they unpack the evolving U.S. climate reporting landscape, explore what companies need to know now, and share practical insights to stay ahead of regulatory expectations.

Whether you're navigating the new California climate bills or looking for a competitive edge, this episode is your guide to understanding what "doing business" really means—and how to stay ahead of regulatory and market demand.

Tune in now and get the clarity your sustainability team needs.

Speakers:

• Catherine Beare, Regional Director - Business Assurance (UK & Iberia)
• Beth Mielbrecht, Associate Director, Sustainability, Intertek Assuris

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Transcript

Transcript- Diving into the climate reporting regulations in the United States

May 1, 2025

00:16 --> 01:19
 Speaker 1 – Catherine Beare, Regional Director - Business Assurance (UK & Iberia)

Hello and welcome to this podcast. Diving into the climate reporting regulations in the United States. I'm Catherine Beare, the Regional Director - Business Assurance (UK & Iberia). And I'm delighted to be joined by Beth Mielbrecht, our Associate Director for our Assuris business in the Sustainability Department.

Beth has been in the sustainability industry for over 30 years and has deep experience in manufacturing and high performing buildings.

Beth, ultimately the sustainability landscape in America has been changing considerably over the last few years. Let's get an update on regulations that companies need to be aware of. So, can you kick  off with what’s happened to the US Security and Exchange Commission’s sustainability proposal, please?

01:19 --> 03:32
 Speaker 2 – Beth Mielbrecht, Associate Director, Sustainability, Intertek Assuris

Hi Katherine. That's a great question. 

That was a source of much speculation, concern and anticipation. So last year in March of 2024, the Security and Exchange Commission, which governs all publicly traded companies, proposed climate rules that would have required anyone who is listed on the Stock Exchange is in the United States to put climate related information on their official registration and reports that they file.

Immediately after those rules were put out that were they were under legal challenge--multiple legal challenges across the United States in different courts. As a result, the Security and Exchange Commission issued a voluntary stay on the climate rules.  What that means is--they just put a stop to it, and the climate rules never went into effect.

Just recently, at the end of March of 2025, the SEC, the Security Exchange Commission, announced that it is ending its defence, so they are no longer going to defend those proposed rules in court anymore because there is significant opposition from the political climate, congressional leaders, the trade associations, different States, and other business entities. So, while there are many companies, States and organisations that are in favour of them, ultimately because of the political landscape, they have decided to stop defending them. 

So that's where it stands right now. In the United States, there are no regulations for publicly traded companies to report on climate issues as part of being traded on the Stock Exchange.

03:32 --> 03:51
 Speaker 1 – Catherine Beare, Regional Director - Business Assurance (UK & Iberia)

Lots of changes. I understand though, Beth, that the state of California has sustainability regulations that are moving forward though. So how do you know who do they apply to? And, what do they focus on?

03:52--> 06:24
 Speaker 2 – Beth Mielbrecht, Associate Director, Sustainability, Intertek Assuris

There's a different political climate in the state of California, and also in different states within the United States--but California has made the most progress.

Those climate disclosure regulations apply to companies that do business in California. 'Doing business' is a legal term, and its definition can be found on California’s official website. What this means is that: any company engaged in any kind of business transaction for financial gain within California, has financial limits that are included in the Bills themselves. If you're doing business in California to make money, you are organised or incorporated in California, and/or you have met some threshold of sales, ownership of property, or payroll of employees, those limits are given on the California Website. 

So that's who they apply to, and what California aims to do is to have companies disclose their greenhouse gas emissions, and that is under something called Senate Bill 253. And, they also want companies to disclose their climate related risk, and that's under Senate Bill 261.

Now those were the original bills, so you will hear them under those names when they were finally passed. They were consolidated and there is another number, it was known as Senate Bill 219. So, you might sometimes see that number as well. So, there's three numbers, but that's how works.

The bill about the greenhouse gas applies to companies who have over 1 billion in revenue--that's who needs to report their greenhouse gases scope one, scope two and scope 3 and that is beginning in 2026, using 2025 data, and we're in 2025 already. So here we are.

06:24 --> 06:33
 Speaker 1 – Catherine Beare, Regional Director - Business Assurance (UK & Iberia)

Well, exactly. I mean, they need to pay attention right now, Beth. This is very, very much of of right now. Yeah, absolutely.

06:33--> 09:30
 Speaker 2 – Beth Mielbrecht, Associate Director, Sustainability, Intertek Assuris

Yeah. And then in the future, it'll require that companies get assurance. So, it’s important to have a third-party like Intertek conduct assurance on those greenhouse gas calculations and numbers, so that everyone can be confident that they are accurate and transparent.

Here's something else though, that is the timeline--there's been no change to that, but the organization within California, that sets up the rules and is going to organize this, is called the California Air Resources Board and they were given an extension until July 1st of 2025 to publish the official requirements. So, as of this recording, we don't have the official requirements yet. We have an idea of what they're going to look like, but we're still waiting on how the California Resources Board will set up the systems for companies to report and provide clear directives.

So, that is the greenhouse gas aspect of it. Let's go into the climate risk aspect of the California bills, that's the part that's called Senate Bill 261, and the requirement for companies doing business in California is half of the greenhouse gas bill--it's only 500 million. So, if you have annual revenues of 500 million or more than it's required to disclose your climate risk, and that's bi-annually, every two years, according to TCFD--the task force for financial disclosures that looks at climate risk, such as your policy and legal risk, technology risk, risk in the market, risk to your reputation, are there risks because of environmental change, also opportunities and how they make a financial impact on your company. That's quite a bit to go through. So, that is also due on or before January 1st, 2026.

Beating right ahead, I want to follow up with one final thing--this is such a United States thing. It's still under legal challenge, so companies should start preparing. We're getting into needing to comply and get the data ready. And yet, there are still lawsuits taking place.

09:30 --> 09:58
 Speaker 1 – Catherine Beare, Regional Director - Business Assurance (UK & Iberia)

Yeah, I mean that's the part that needs attention paid and I think that shouldn't be overlooked. I mean, Beth, we could speak for hours on this because it's clearly got a level of complexity in it, but I think the deadline that you mentioned was important there, but what's the best step for companies to take who want to be ready to meet the California regulations?

09:58--> 13:42
 Speaker 2 – Beth Mielbrecht, Associate Director, Sustainability, Intertek Assuris

Yeah. The best step is to start your journey wherever you are. Don't be wishing that this goes away if it's not for California, it'll be at a request from your clients. If it's not for California, it'll be for some other jurisdiction. This is the state of sustainability now.

So, the next thing you could do is look at your greenhouse gas inventory. Are you doing that internally? Do you have a consultant doing it? Are you using software or a spreadsheet? But start, I suggest to start looking at scope one and two--that covers your purchased electricity and the fuel that you use in your buildings. So, if you're heating with natural gas or if you own vehicles, the fuel that you put in--start with that.

Once you've got that, look at scope three. What are your most important categories of scope 3? So, that's the impacts from your upstream and your downstream. If you're a manufacturer, what do you purchase (all your raw materials)? That's probably impactful. If you distribute things--look at your downstream. If you have a lot of business travel--look at that. So, there's a way to start picking at the most important Scope 3 categories. 

Next step would be you could look at a gap assessment--where are you with where you are now and where you want to be, not just with your greenhouse gas reporting, but also with your other environmental, social and governance metrics. Are you looking at waste and water? Are you looking at social metrics such as injuries or diversity or workplace training? Are you looking at governance? How are your policies? Set up a plan and with a gap assessment or readiness assessment, that'll give you some action steps of how to get where you want to go.

Another aspect that you can consider. 

If you've been in this journey a little bit, you might want to consider assurance. Assurance is having someone check your work. Having someone make sure that you've done the calculations correctly, that you've included everything, transparently, that everyone on your team who is feeding information to you is following good procedures and processes. It's a great opportunity to learn to improve your systems and to have confidence that when you're ready to share your metrics with California, in your sustainability report, or with some other reporting entity that you know that it's accurate.

And another step you could take is to look at your risk and decide, what plan do you want to put in place? Is this something that you want to look at more carefully? The double materiality assessment is foundational in assessing your risks that are unique to your company and your company's values, your company's stakeholders--you could proceed that way as well. So, there's a couple of options. Depends on where you are in your journey. That's what I would say about where you can start and take a next step.

13:42 --> 16:01
 Speaker 1 – Catherine Beare, Regional Director - Business Assurance (UK & Iberia)

That's fantastic. Beth. 

Beth, thank you so much for your time today. And as I said, I actually think we could do multiple on this topic alone. So let's let's see what our audience wants with the feedback we get. But thank you for that today. 

As a reminder, here's how Intertek can help you with sustainability regulations in California. Firstly, we can help you with a gap assessment sometimes called, a readiness assessment. To figure out what actions you should take to be able to confidently disclose your sustainability information.

Secondly, we can conduct your greenhouse gas inventory and perform the calculations so that you know what your GHG starting point is, and you'll have a good understanding of what the process entails. As well as a spreadsheet template to use going forward.

Thirdly, we can perform greenhouse gas and ESG assurance on your sustainability disclosures, providing you with a third-party assurance statement that you can share documenting your transparency and accuracy.

And finally, we can help with your CDP reporting by giving you detailed assistance on CDP questionnaire.

For more information, please do go and visit our website on www.intertek.com/assuris/sustainability . 

So that concludes today's podcast, Beth. Thank you. Excellent expertise there and something you clearly are passionate about and know a lot. So thank you for taking the time with me today.

And thank you, the listener, and please do watch out for more episodes from the assurance team to help you with your sustainability journey. 

Thank you very much everyone.