Apple put its considerable heft behind a California bill that will, if passed, increase the emissions reporting requirements for more than 5,000 large companies that do business in the state.

In a move lauded by the bill’s author, Apple, the $2.8 trillion behemoth, came out in support of The Climate Corporate Data Accountability Act (SB 253). The bill was approved Monday in the state Assembly and now goes to the state Senate.

The proposed legislation would require corporations with total annual revenue greater than $1 billion that do business in California to report the prior year’s Scope 1 and Scope 2 emissions by a date yet to be determined in 2026 and Scope 3 in 2027, with annual reports thereafter. Scope 1, 2 and 3 emissions are used globally to define the different types of greenhouse gas emissions of companies:

• • Scope 1 emissions are direct greenhouse gases emitted by a company, for example from running boilers, burning fuel in a manufacturing process or powering non-electric vehicles;
  • Scope 2 emissions are indirect emissions from electricity, steam, heating or cooling purchased by the company for uses ranging from lighting to charging electric vehicles;
  • Scope 3 emissions are indirect and related to a company’s supply chain, both its inputs through to the end use and eventual disposal of the goods. These emissions may include goods and services a company buys, employees’ commuting and work travel, emissions from transporting and distributing a product to consumers and final use and disposal of the product. This is not only the largest category of emissions but also the hardest to measure.

State Sen. Scott Weiner (D–San Francisco) on Friday posted a message on X (formerly Twitter) about Apple’s move: “Huge new endorsement — @Apple — of our groundbreaking climate bill to require large corporations to disclose their carbon footprint (SB 253). Thank you, Apple, for making clear that this is doable & a critically important piece of climate action.”

The endorsement of the bill came in a letter to Weiner which stated, in part:

“We’re strongly supportive of climate disclosures to improve transparency and drive progress in the fight against climate change, and we’re grateful for your leadership to drive comprehensive emissions disclosure.”

Apple’s support comes more than two weeks after a group of companies including Microsoft, Adobe, IKEA USA and Atlassian issued a joint statement in support of SB 253 that said “California is on track to be the fourth-largest economy in the world and this bill would set a global standard for emissions disclosure. SB 253 would level the playing field by ensuring that all major public and private companies disclose their full emissions inventory, creating a pathway for collective reduction strategies.”

By requiring Scope 3 emissions reporting, SB 253 exceeds the proposed Securities and Exchange Commission (SEC) rule, which largely lets companies out of reporting them unless they already have a stated target for reducing them or if they are material, that is, if a “reasonable investor” would be “substantially likely” to consider them important when making an investment or voting decision.

This is not Weiner’s first attempt at passing the bill: SB 253 failed to pass by one vote in 2022, but has been amended to delay Scope 3 emissions reporting by a year, aligning the bill with the International Sustainability Standards Board’s IFRS S2 Climate-related Disclosures standard issued in June 2023.

Corporate Support is Far from Unanimous

In August, a policy advocate specializing in energy issues at the California Chamber of Commerce, Brady Van Engelen, critiqued the bill, calling for legislators “to reject an onerous emissions tracking and paperwork requirement that will increase costs on California businesses.”

Much of CalChamber’s concern centers on the use of secondary data or industry averages for calculating Scope 3 emissions.

“Secondary data is inherently flawed and unreliable, nor does it paint an accurate picture. This flawed method of calculating Scope 3 emissions means that virtually every reporting entity could be subject to a violation,” Van Engelen said in his August 23 post.

CalChamber, along with many other companies and associations including the Western States Petroleum Association, the California Retailers Association and the California Manufacturers and Technology Association, issued a joint statement opposing the bill, which stated in part: “At this juncture, Scope 3 emissions reporting is more of an art than it is a science. Due to the likelihood of double counting, assessing Scope 3 emissions data with any degree of accuracy is not yet possible.”

The letter from Apple directly addressed the challenge of Scope 3 emissions reporting, highlighting its own efforts: “We acknowledge that there is inherent uncertainty in modeling carbon emissions, primarily due to data limitations. Scope 3 emissions, in particular, involve making educated assumptions and complex modeling. We believe, however, that our reports attest to the feasibility of reasonably modeling, measuring and reporting on all three scopes of emissions, including scope 3 emissions, which represent the overwhelming majority of most companies’ carbon footprint and are therefore critical to include.”

The bill is not the only proposed climate-related legislation being considered in California. Senate Bill 261, the Climate-Related Financial Risk Act (SB 261), would require companies with greater than $500 million in revenue to report on “material risk of harm to immediate and long-term financial outcomes due to physical and transition risks,” by the beginning of 2026 and biennially thereafter. Assembly Bill 1305, the Voluntary Carbon Market Disclosures Act  (AB 1305), requires much more detailed disclosures on the websites of companies marketing or selling voluntary carbon offsets within the state.