Saturday, July 20, 2024

California governor to sign landmark climate disclosure bill

California Gov. Gavin Newsom said Sunday that he will sign a major climate bill passed by the state’s legislature last week that would require large corporations with national and global ramifications to publicly disclose their greenhouse gas emissions.

The new law requires about 5,000 companies to report the amount of greenhouse gas pollution emitted directly by their operations, as well as the amount of indirect emissions from employee travel, waste disposal and supply chains.

Climate policy advocates have long argued that such disclosures are an essential first step in efforts to use financial markets to curb planet-warming pollution. For example, if investors learn about a company’s climate warming impacts, they may choose to put their money elsewhere.

The law applies to public and private businesses in California that generate more than $1 billion in annual revenue. But because the state is the world’s fifth-largest economy, California often sets the course for the nation, and many of the affected businesses are global corporations.

A Democrat, Mr. There were some questions about whether Newsom would sign the legislation. The California Chamber of Commerce lobbied against it, and the governor’s own state Department of Finance objected, saying the move would impose new costs not currently in the state’s spending plan. The bill was approved by the state senate last week. After being referred to Newsom’s desk, his office declined to say what he would do.

But he asked at one o’clock Climate Week event If he signs the bill at the Times Center on Sunday, Mr. Newsom first responded by recounting the history of California’s leading climate policies, including his own administration’s requirement that every new car in the state be fully electric by 2035.

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“Can I give up that leadership by giving an answer other than, of course, I will sign that bill?” He responded to a question from New York Times reporter David Kellus, who interviewed the governor in front of an audience. “No I won’t.”

Mr. Newsom said his signature came with “a modest caveat” that his office needed to “clean up some minor language” in the law. But he did not clarify the changes he wants to make, and a spokeswoman for his office did not respond to a voicemail message or text message.

Many of the affected businesses include oil and gas companies such as Chevron, large financial institutions such as Wells Fargo, and global brands such as Apple. Companies must disclose all emissions from 2027.

The new measure would be combined with another new law that requires companies with more than $500 million in revenue to report their climate-related risks, although they don’t have to disclose specific emissions.

The California law goes beyond a measure proposed by the Securities and Exchange Commission that would require only publicly traded companies to disclose their emissions. That proposal, which has yet to be finalized, faces fierce opposition from conservatives and business groups.

“That a state like California would do this is both troubling and promising,” said Robert Stavins, director of the Environmental Economics Program at Harvard. “A $1 billion company with $35 operations in California is affected. But it’s potentially promising because California has a long history in the United States of being a leader in environmental regulation and other states following suit and the federal government eventually catching up.”

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Climate policy advocates applauded the move. “These two first-in-the-nation bills will provide unprecedented insight into corporate climate emissions and financial climate risk,” said Mindy S. said Luper, chief executive and president of Ceres, a nonprofit group that works with investors and companies on environmental issues. .

Opponents have said compliance would be expensive and difficult, especially since businesses would have to accurately track and measure all emissions. For example, apparel manufacturers are concerned about reporting direct emissions from their apparel manufacturing plants as well as emissions associated with textile growing, weaving, and transportation.

The California Chamber of Commerce last week called the legislation “a negative impact on businesses of all sizes in California and will not directly reduce emissions,” said Denise Davis, executive vice president of the California Chamber of Commerce.

Mrs. Davis said Sunday that his organization Mr. Newsom said he was disappointed by the decision, but hoped further “cleanup” legislation next year could lessen the impact of the new law.

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