California SB-261 Climate Risk Disclosure Calculator (>$500M Revenue) | Coverage, Report Contents & Ninth Circuit Stay Status
Determine whether an entity is covered by California SB-261 from its annual revenue and California nexus, and see what the biennial climate-related financial-risk report must contain, when it is due, and how the current Ninth Circuit enforcement stay affects the deadline.
This is a narrative-disclosure law whose enforcement is currently stayed — read the stay status first, then the coverage test. California SB-261, the Climate-Related Financial Risk Act, requires large companies doing business in California to publish a climate-related financial-risk report. Its statutory first deadline was 1 January 2026, but the Ninth Circuit granted an injunction in November 2025 that pauses enforcement pending an appeal. This calculator resolves whether an entity is in scope and what its report must contain; it is a scoping and planning tool, not an emissions engine.
What it computes. You enter an entity’s total annual revenue and confirm whether it does business in California. The tool returns coverage under SB-261 (triggered above $500 million in revenue), flags whether the entity also crosses the $1 billion SB-253 emissions threshold, and sets out the climate-risk report’s expected structure, cadence, and current deadline status. It does not estimate emissions or draft the report; it scopes the obligation.
Why revenue and California nexus are the pivot. SB-261 turns on a revenue threshold combined with “doing business in California” — not on incorporation or headquarters location. A company headquartered anywhere in the United States can be covered if it meets the revenue test and has sufficient California activity. The revenue figure is the entity’s total annual revenue, measured against the gross-receipts concept in the California Revenue and Taxation Code, not its California-only revenue.
A narrative report, not an emissions inventory. SB-261 asks for a climate-related financial-risk report aligned to the TCFD framework or an equivalent such as IFRS S2 — a structured description of climate risks and the measures taken to reduce and adapt to them. This is the defining contrast with its companion law SB-253, which requires a quantitative greenhouse-gas inventory above a higher $1 billion threshold. A company between $500 million and $1 billion owes the SB-261 report but not the SB-253 inventory.
Source basis. The revenue threshold and the biennial cadence are read live by the calculator engine from the Master Brain (the reporting.sb_253_261.* framework rows, anchored to the SB-261 / SB-253 statutory text as amended by SB-219). The deadline, the litigation posture, and the penalty figure are stated from the statute and CARB’s filings and are hand-reviewed — the Master Brain does not carry a live status, deadline, or penalty field. Because the Ninth Circuit appeal is active, confirm the current position against CARB before relying on it.
0
Applicability & profile
SB-261 applies to entities doing business in California with total annual revenue over $500M (total, not California-only; public and private). At $1B you also file SB-253.
Audit mode adds the full per-disclosure status table to the results below.
Enter your revenue and assess the TCFD disclosures to determine your SB-261 compliance route
A compliance-route verdict (full coverage / gap-statement route / action needed) with four-pillar coverage, a gap register, consistency checks, and exportable gap statement + report-outline scaffolds.
This is a readiness self-assessment, not legal advice and not a filed SB-261 report. It assesses coverage of the TCFD recommended disclosures and determines a compliance route under California Health & Safety Code §38533; the authoritative determination rests with the entity, its advisers and CARB. SB-261 enforcement is currently paused pending the Ninth Circuit appeal, and CARB’s report-format regulation is pending — verify against the current statute and CARB guidance for your reporting cycle.
The headline number in California’s climate-disclosure package is the $1 billion emissions law. The quieter companion reaches twice as far down — to every company above half a billion in revenue doing business in the state — and asks not for a number but for an account of the risk.
SB-261 is the lower threshold, the wider net, and the one a court has paused — which is exactly why so many companies misread where they stand.
SB-261 covers companies above $500 million in revenue doing business in California, requiring a biennial climate-related financial-risk report aligned to TCFD or IFRS S2. Its 1 January 2026 deadline is currently stayed by a Ninth Circuit injunction.
SB-261’s enforcement is currently stayed. The statute set a first climate-risk report deadline of 1 January 2026, but in November 2025 the Ninth Circuit granted an injunction pausing enforcement pending an appeal brought by business groups (status verified 5 June 2026). The court heard oral argument in January 2026 and has not yet ruled. CARB has opened a voluntary docket and stated it will set an alternate SB-261 reporting date once the appeal resolves. The companion law SB-253 was not enjoined and is proceeding to its own 10 August 2026 emissions deadline — the stay covers SB-261 only. Both the appeal and CARB’s rulemaking are active; confirm the current position against CARB before relying on it for a filing decision.
What this calculator determines
The calculator resolves whether an entity is covered by California SB-261 from two inputs — total annual revenue and whether it does business in California — and returns the climate-risk report the law requires, its cadence, and the current deadline status. It is a coverage and scoping tool: it answers “does this law apply to me, what must my report cover, and when is it due,” not “what are my emissions.” Drafting the report itself, and quantifying any climate-risk scenarios within it, are separate steps.
Coverage turns on revenue and California nexus, not headquarters
SB-261 combines a $500 million revenue threshold with a “doing business in California” test. Neither element looks at where a company is incorporated or headquartered — a business based anywhere in the United States is covered if it meets the revenue test and has sufficient California activity. The revenue figure is the entity’s total annual revenue, pinned by CARB’s regulation to the gross-receipts concept in the California Revenue and Taxation Code, so the threshold reads against a defined tax-code measure rather than against California-only sales. This is the single most-missed point in scoping the law.
A risk report, not an emissions inventory
SB-261 sits beneath SB-253 in the California SB-253 and SB-261 climate-disclosure regime, and the two laws ask for different things. SB-261, the Climate-Related Financial Risk Act, requires a narrative climate-related financial-risk report above $500 million in revenue. SB-253, the Climate Corporate Data Accountability Act, requires a quantitative greenhouse-gas inventory above $1 billion. A company above $1 billion typically falls under both and files a combined dual obligation; a company between $500 million and $1 billion falls under SB-261 only. The tool separates the two so the lower-threshold obligation is not lost behind the higher one.
SB-261 is triggered by revenue plus California business activity, not by incorporation or headquarters. It applies above $500 million in annual revenue and mandates a biennial climate-related financial-risk report aligned to TCFD or IFRS S2 — a narrative disclosure, not an emissions count. Revenue and California nexus are therefore the two inputs that decide everything else.
Am I covered? The $500M test
Coverage is a two-step test: does the entity meet the $500 million revenue threshold, and does it do business in California. Because SB-261’s threshold is lower than SB-253’s, an entity can be covered by SB-261 alone (between $500 million and $1 billion), by both laws (above $1 billion), or by neither. The calculator applies the test and returns the governing combination.
| Law | Revenue trigger | What it requires | Cadence |
|---|---|---|---|
| SB-261 — Climate-Related Financial Risk Act | Revenue > $500M | Climate-related financial-risk report (TCFD / IFRS S2 aligned) | Biennial |
| SB-253 — Climate Corporate Data Accountability Act | Revenue > $1B | Scope 1, Scope 2, then Scope 3 GHG emissions (GHG Protocol) | Annual |
SB-261 / SB-253 coverage thresholds and deliverables. The revenue triggers ($500M SB-261, $1,000M SB-253) and the SB-261 biennial cadence are queryable Master Brain fields read live by the calculator engine (reporting.sb_253_261.sb261.threshold.annual_revenue_usd_m, …sb253.threshold.annual_revenue_usd_m, …sb261.cadence.years), anchored to the SB-261 / SB-253 statutory text as amended by SB-219. These are outside_scopes framework markers — used for coverage logic, never summed into a CO₂e total. The prose values are hardcoded per the Calculator JS-runtime rule; the engine is the live read path. Both thresholds combine with a “doing business in California” test. Source CA_SB261 / CA_SB253, MasterBrain v2026.203.
The $500 million threshold
An entity with total annual revenue above $500 million that does business in California is a covered entity under SB-261 and must publish a climate-related financial-risk report. The threshold is a bright line on revenue — there is no public-company requirement and no exemption for private companies, which is a sharp contrast with the federal SEC rule’s public-float filer tiers. Insurance companies already reporting under the National Association of Insurance Commissioners climate framework are the principal carve-out; most other large entities doing business in the state are in scope.
“Doing business in California” — the trap
The phrase carries the coverage weight that catches companies off guard. An out-of-state company with no California office can still be doing business in California through sales, property, or payroll in the state above the relevant tax-code thresholds. Because the revenue figure is the entity’s total annual revenue — not its California revenue — a company with modest California activity but large global revenue can be fully covered. Scoping on California-only revenue, or assuming a non-California headquarters means exemption, is the most common way companies wrongly conclude they are out of scope.
The $500M–$1B band — SB-261 without SB-253
This is the band SB-261 reaches that SB-253 does not. A company with total revenue between $500 million and $1 billion clears the SB-261 threshold but sits below the SB-253 emissions threshold: it owes the biennial climate-risk report but not the annual GHG inventory. That is the correct result, not a gap in coverage. Companies in this band often assume that “the California climate laws” mean the emissions inventory and conclude they are exempt because they are under $1 billion — missing the risk-report obligation that applies to them squarely.
The revenue test uses total annual revenue, but the nexus test uses California business activity. These are different measures and must not be conflated. A company can have only a small fraction of its sales in California and still be a covered entity if its total revenue exceeds $500 million and its California activity meets the “doing business” standard. Do not scope coverage on California revenue alone — enter total revenue and confirm California nexus separately.
If an entity is above $1 billion in revenue, it picks up SB-253 alongside SB-261 and files a combined dual obligation — a risk report under SB-261 and an emissions inventory under SB-253. Treat the two as one program with two deliverables on different cadences (biennial risk report, annual emissions) rather than as separate compliance projects. Scope the emissions side with the California SB-253 climate disclosure calculator.
The Ninth Circuit stay — is SB-261 in effect?
SB-261’s enforcement is paused, and the precise scope of that pause is the most-misread point in the law. The injunction halts SB-261 enforcement only; it does not reach SB-253, and it does not repeal SB-261. Understanding what the stay does and does not do is the difference between standing down appropriately and missing a live obligation.
What the injunction halts
In November 2025 the Ninth Circuit granted an injunction pausing enforcement of the SB-261 reporting deadline pending an appeal brought by business groups, who argue the disclosure mandate raises First Amendment compelled-speech concerns. The court heard oral argument in January 2026 and has not yet issued a decision. While the stay is in force, CARB is not enforcing the 1 January 2026 SB-261 deadline. The stay pauses enforcement; it does not strike the statute, which remains on the books pending the appeal’s outcome.
The voluntary docket
CARB has opened a voluntary docket for SB-261 climate-risk reports and stated it will set an alternate reporting date once the appeal resolves. Companies may file voluntarily while the stay is in effect. Many large entities are preparing reports regardless, because the underlying TCFD or IFRS S2 disclosure work supports investor and customer demands that exist independently of the California mandate, and because an alternate deadline is likely to follow quickly once the litigation clears.
Why SB-253 was not enjoined
The same court declined to halt SB-253. The emissions-reporting law is proceeding to its own first deadline of 10 August 2026 for Scope 1 and Scope 2 reporting, set by CARB’s initial regulation adopted in February 2026. This asymmetry — SB-261 stayed, SB-253 live — is the central source of confusion. A company that hears “the California climate laws are stayed” and stands down all its preparation is conflating the two statutes and may miss a live SB-253 deadline if it is above $1 billion.
The stay is a pause on enforcement, not a repeal.
SB-261 remains law; only its deadline waits on the court, and only SB-261 — not its emissions companion — is paused.
Do not read the SB-261 stay as covering SB-253. The Ninth Circuit injunction halts SB-261 enforcement only; SB-253 is not enjoined and its 10 August 2026 Scope 1 and 2 deadline stands for companies above $1 billion. Equally, do not read the stay as ending SB-261 — the statute is intact, CARB will set an alternate date, and the underlying report work is still expected. Treat the SB-261 deadline as pending the court, not cancelled.
What the climate-risk report must contain
SB-261 asks for a structured narrative, not a number. The report describes the entity’s material climate-related financial risks — both physical and transition — and the measures it has adopted to reduce and adapt to them, following the TCFD framework or an equivalent such as IFRS S2. The TCFD four-pillar structure is the practical backbone of the report.
Governance
How the board oversees climate-related risks and opportunities, and management’s role in assessing and managing them. The disclosure names the bodies and processes, not just a policy statement.
Strategy
The climate risks and opportunities identified over short, medium, and long horizons, and their impact on the business, strategy, and financial planning — including, where relevant, resilience under different climate scenarios.
Risk management
How the entity identifies, assesses, and manages climate-related risks, and how those processes integrate into overall enterprise risk management.
Metrics and targets
The metrics and targets used to assess and manage material climate risks. SB-261 does not mandate a full GHG inventory, but where an entity reports emissions or climate targets they belong here.
Physical risk versus transition risk
The report separates two risk types. Physical risk is the financial exposure from climate hazards — acute events such as floods, wildfires, and storms, and chronic shifts such as sea-level rise and heat. Transition risk is the exposure from the move to a lower-carbon economy — policy and legal change, technology shifts, market repricing, and reputational effects. A SB-261 report addresses both, sized to the entity’s own circumstances, and explains the measures adopted in response.
TCFD’s succession by IFRS S2
SB-261 references the TCFD framework, but TCFD as a standing body dissolved in 2024, with the International Sustainability Standards Board’s IFRS S2 standard taking over as the successor disclosure standard. CARB’s guidance accommodates reporting against TCFD or an equivalent, and IFRS S2 is the natural equivalent because it carries TCFD’s four-pillar architecture forward. A company building a SB-261 report today generally structures it to IFRS S2, which satisfies the TCFD-aligned requirement while aligning with the standard most other jurisdictions are adopting.
The SB-261 report is built on TCFD’s four pillars — governance, strategy, risk management, and metrics and targets — covering both physical and transition climate risk. TCFD dissolved in 2024 and IFRS S2 is its successor, so a report structured to IFRS S2 satisfies the TCFD-aligned requirement. SB-261 produces a narrative of risk and response; it does not require a greenhouse-gas inventory, which is SB-253’s job.
Deadline, cadence and status
SB-261’s reporting timeline is defined by its statutory deadline and its biennial cadence, both currently overlaid by the Ninth Circuit stay. The table states the current position; treat every date as confirmable against CARB given the active appeal and rulemaking.
| Element | Position | Status |
|---|---|---|
| SB-261 first climate-risk report | 1 Jan 2026 (statutory) | Enforcement stayed (9th Cir. injunction, Nov 2025); voluntary docket open |
| Reporting cadence | Biennial (every 2 years) | Read live by the engine from the Master Brain |
| Alternate deadline | To be set by CARB | After the Ninth Circuit appeal resolves |
| Companion SB-253 (if > $1B) | 10 Aug 2026 (Scope 1 & 2) | Not enjoined; proceeding |
SB-261 reporting timeline. The biennial cadence is read live by the engine from the Master Brain (reporting.sb_253_261.sb261.cadence.years); the 1 January 2026 statutory deadline, the November 2025 Ninth Circuit stay, the voluntary docket, and the pending alternate date are hardcoded with source, as the Master Brain carries no live deadline or status field. The companion SB-253 deadline (10 August 2026, for entities above $1 billion) is shown for the dual-filing case. Sources: SB-261 statutory text; CARB filings; Ninth Circuit docket. Status and calendar dates are hand-reviewed. Confirm against CARB before relying on any date (verified 5 June 2026).
The statutory deadline and the stay
SB-261 set 1 January 2026 as the first deadline for the climate-risk report, to be published on the entity’s website. That deadline is the subject of the Ninth Circuit injunction: while the stay holds, CARB is not enforcing it, and CARB has signalled an alternate date will follow the appeal. The statute itself is unchanged, so the obligation is best treated as deferred rather than removed.
The biennial cadence
Once in force, the SB-261 report is published every two years, a lighter cadence than SB-253’s annual emissions reporting. The biennial interval is the field the calculator engine reads live from the Master Brain; the calendar anchoring it depends on the alternate date CARB sets after the appeal. A company preparing now should plan for a recurring two-year cycle rather than a one-off filing.
How the calculator works
You enter total annual revenue and confirm whether the entity does business in California, and the calculator applies the SB-261 revenue threshold and nexus test, flags whether the entity also crosses the SB-253 threshold, and returns the report obligation, cadence, and current deadline status.
Enter revenue and California nexus
Total annual revenue in US dollars — the entity’s total, not its California revenue — and a confirmation of whether it does business in California. Both are needed: a high-revenue entity with no California nexus is out of scope, and a California entity below $500 million is below the threshold.
Resolve coverage and the band
The tool tests revenue against the $500 million SB-261 threshold and the $1 billion SB-253 threshold, combined with the nexus check, and returns the band: below both, SB-261 only ($500M–$1B), or both laws (above $1B).
Read the report obligation and status
The result shows the biennial climate-risk report obligation, its TCFD / IFRS S2 framework basis, and the current deadline status — including the Ninth Circuit stay and CARB’s voluntary docket — plus the SB-253 escalation if the entity is above $1 billion.
If the tool returns SB-261 coverage without SB-253, the entity sits in the $500 million-to-$1 billion band — it owes the biennial risk report but not the emissions inventory. If it returns both, the entity is above $1 billion and should treat the two as one program. Either way, the SB-261 result is annotated with the stay status, so a covered entity sees both that it is in scope and that the deadline is currently paused.
Worked example — a company in the SB-261-only band
This example is illustrative and shows coverage logic, not an emissions or risk computation — the tool scopes the obligation, and the report itself is drafted separately. Consider a US software company headquartered in Washington State with total annual revenue of $720 million and substantial subscription sales to California customers.
Resolving coverage
Total revenue of $720 million is above the $500 million SB-261 threshold but below the $1 billion SB-253 threshold, and the California subscription sales establish “doing business in California.” The Washington headquarters is irrelevant to coverage. The company is a covered entity under SB-261 — and only SB-261. It owes the biennial climate-risk report; it does not owe the SB-253 emissions inventory.
What is due, and when
Under SB-261, the company must publish a TCFD- or IFRS-S2-aligned climate-related financial-risk report on its website, covering governance, strategy, risk management, and metrics and targets across its physical and transition climate risks, on a biennial cadence. The first deadline was 1 January 2026, but it is currently stayed by the Ninth Circuit injunction — so the company may file voluntarily on CARB’s open docket while the appeal is pending, and should plan for the alternate date CARB sets afterward.
What it does not owe
Because it is below $1 billion, the company has no SB-253 emissions-inventory obligation — no Scope 1, 2, or 3 reporting under that law, and no 10 August 2026 deadline. Its entire California climate-disclosure obligation is the SB-261 risk report. If its revenue later crosses $1 billion, SB-253 would attach and the company would move into the dual-filing band; until then, the risk report is the whole of it.
For this $720 million company, coverage resolves to SB-261 alone — above the $500 million risk-report threshold, below the $1 billion emissions threshold, with the out-of-state headquarters changing nothing. The planning question is not “am I a California company” but “do I clear $500 million and do I do business in the state,” and for this software company the answer is yes to both. From there a single deliverable follows: the biennial climate-risk report, currently deadline-paused by the court.
SB-261 vs SB-253, IFRS S2 and TCFD
SB-261 is one of several climate-disclosure regimes a large company may face at once, and the risk-report ones are frequently confused with each other and with the emissions laws. The clearest way to scope a company’s full obligation is to see where SB-261 sits relative to its emissions companion SB-253, the international IFRS S2 standard, and the TCFD framework it descends from.
| Regime | Trigger | Output | Status |
|---|---|---|---|
| California SB-261 | > $500M revenue, doing business in CA | Climate-risk report (narrative) | In force; enforcement stayed (9th Cir.) |
| California SB-253 | > $1B revenue, doing business in CA | GHG emissions inventory (Scope 1/2/3) | In force; first report Aug 2026 |
| IFRS S2 | Adopting jurisdiction’s rules | Climate-risk disclosure + metrics | Live where adopted into law |
| TCFD | Voluntary / referenced by regulators | Four-pillar risk disclosure | Dissolved 2024; succeeded by IFRS S2 |
Climate-risk disclosure regimes compared. SB-261 is a mandatory US state narrative-disclosure regime currently under an enforcement stay; SB-253 is its quantitative emissions companion at a higher threshold; IFRS S2 is the ISSB standard live where adopted; TCFD is the dissolved framework both descend from. Triggers and statuses stated from each regime’s governing instrument as of June 2026.
vs SB-253
Same state, same coverage mechanics, different deliverable and threshold. SB-261 is a narrative risk report above $500 million; SB-253 is an emissions inventory above $1 billion. Above $1 billion a company files both. Scope the emissions side with the California SB-253 climate disclosure calculator.
vs IFRS S2
IFRS S2, the ISSB standard, is being adopted into law across many jurisdictions and is the natural framework for the SB-261 report. The two overlap almost entirely on the risk side, so one IFRS S2-structured report can serve both. Scope the international piece with the IFRS S2 climate disclosure calculator.
vs TCFD
TCFD is the framework SB-261 names, but the body dissolved in 2024 and IFRS S2 succeeded it. The four-pillar structure lives on in both. For the scenario-analysis component that anchors the strategy pillar, see the TCFD scenario analysis calculator.
vs the federal SEC rule
The federal SEC climate-disclosure rule is stayed and under proposed rescission, and it never required a standalone TCFD-style risk report of SB-261’s kind. SB-261 is the live US obligation in this space. Scope the federal position with the SEC climate disclosure calculator.
Penalties and enforcement
SB-261 carries a financial penalty, but its enforcement is currently paused by the Ninth Circuit stay, so the penalty is not presently enforceable. The penalty is set by statute; the Master Brain does not carry a penalty field, so these figures are stated from the statute and hand-reviewed.
| Law | Maximum penalty | Current enforceability |
|---|---|---|
| SB-261 | $50,000 per reporting year | Stayed (9th Cir. injunction); not currently enforced |
| SB-253 (if > $1B) | $500,000 per reporting year | Not enjoined; first-cycle good-faith relief applies |
SB-261 / SB-253 penalty ceilings. SB-261 administrative penalties are capped at $50,000 per reporting year (per the SB-261 statutory text); SB-253 penalties may not exceed $500,000 per reporting year. CARB weighs the violator’s compliance history and good-faith efforts. SB-261 penalties are not currently enforceable because of the Ninth Circuit stay on that law’s enforcement. Penalty figures are not Master Brain values (no penalty field exists in reporting.sb_253_261.*) — stated from the statute and hand-reviewed. Source: SB-261 / SB-253 statutory text; CARB filings.
The penalty, and why it is paused
SB-261 authorises administrative penalties up to $50,000 per reporting year for violations such as failing to publish a required report. While the Ninth Circuit injunction holds, CARB is not enforcing the SB-261 deadline, so no penalty currently attaches for non-filing. That posture can change quickly: if the appeal resolves in the statute’s favour and CARB sets an alternate date, the penalty regime resumes against the new deadline.
The dual-filing case
A company above $1 billion that also files under SB-253 faces that law’s separate penalty ceiling of $500,000 per reporting year, alongside first-cycle good-faith relief and a Scope 3 safe harbor through 2030. The two penalty regimes are independent: the SB-261 stay does not pause SB-253 enforcement, so a dual-filer’s emissions obligation remains live even while its risk-report deadline waits on the court.
The SB-261 penalty being currently unenforceable is not a reason to abandon report preparation. CARB has signalled an alternate deadline will follow the appeal, and the underlying TCFD or IFRS S2 work takes time to build. A company that treats the stay as permanent relief risks scrambling once the court rules and CARB sets a new date. Treat the deadline as deferred, not cancelled, and keep preparing.
Common scoping errors
The recurring mistakes here lead a company to wrongly conclude it is out of scope, or that the stay means nothing is due. The ones below most often produce a wrong conclusion about SB-261.
01 — Assuming a non-California HQ means exemption
Coverage turns on doing business in California plus total revenue, not headquarters. An out-of-state company with California sales above the tax-code thresholds is covered.
02 — Scoping on California revenue only
The revenue test uses total annual revenue, not California revenue. A company with small California sales but large global revenue can be fully covered.
03 — Reading the stay as a repeal
The Ninth Circuit injunction pauses enforcement; it does not strike the statute. CARB will set an alternate date once the appeal resolves, and the report obligation persists.
04 — Assuming under $1B means no California obligation
The $1 billion line is SB-253’s. A company between $500 million and $1 billion still owes the SB-261 risk report — coverage is not all-or-nothing at $1 billion.
05 — Treating SB-261 as an emissions report
SB-261 is a narrative risk report, not a GHG inventory. Building a Scope 1/2/3 inventory is SB-253’s job; SB-261 asks for governance, strategy, risk management, and targets.
06 — Building to dissolved TCFD instead of IFRS S2
TCFD dissolved in 2024; IFRS S2 is its successor and the natural structure for the report. Building to IFRS S2 satisfies the TCFD-aligned requirement and travels further.
Scope boundary — what this tool does not cover
This calculator scopes coverage under California SB-261 and returns the report obligation, cadence, and deadline status. It does not draft the climate-risk report, run scenario analysis, build an emissions inventory, or scope the adjacent regimes — those are separate tasks, several of which have their own calculators.
| Task | What it is | In this tool? |
|---|---|---|
| SB-261 coverage | Whether the law applies, what the report covers, when it is due | Yes — this is what the calculator scopes |
| SB-253 emissions coverage | Whether the >$1B emissions law also applies | Partial — flags the escalation; scope it with the SB-253 calculator |
| Climate scenario analysis | Physical / transition risk under climate scenarios | No — run it with the TCFD scenario analysis calculator |
| IFRS S2 disclosure scoping | The international risk-disclosure standard | No — see the IFRS S2 climate disclosure calculator |
| Federal SEC position | The stayed 2024 SEC climate rule | No — see the SEC climate disclosure calculator |
The coverage determination this tool produces is the starting point: once an entity knows it is a covered entity under SB-261, the next step is structuring the climate-risk report to TCFD or IFRS S2, running the scenario analysis that anchors the strategy pillar, and — if also above $1 billion — building the SB-253 emissions inventory. The full methodological treatment of the California disclosure laws is on the paired California climate-disclosure methodology page.
A coverage “yes” from this tool is not a completed report. It tells you the law applies, what the report must cover, and its current deadline status — it does not write your governance, strategy, risk-management, or metrics disclosures, or run your scenario analysis. The SB-261 report requires an actual assessment of the entity’s physical and transition climate risks; the coverage determination is the first hour of that project, not the last.
Data sources and status transparency
Threshold and cadence from the Master Brain
The $500 million revenue threshold, the $1 billion SB-253 escalation line, and the SB-261 biennial cadence are queryable Master Brain fields read live by the calculator engine — under reporting.sb_253_261.*, anchored to the SB-261 and SB-253 statutory text as amended by SB-219. These are outside_scopes framework-threshold records, not emission factors: the engine uses them to resolve coverage and cadence, never to compute a carbon total. If the Master Brain is unavailable, the engine falls back to hardcoded values matching these rows for stale-cache safety.
Deadline, status and penalty are hand-reviewed
The Master Brain does not carry a live deadline, status, or penalty field for these laws. It resolves the biennial cadence, but the 1 January 2026 statutory deadline, the Ninth Circuit stay, the voluntary docket, the pending alternate date, and the $50,000 penalty ceiling are stated from the statute and CARB’s filings and reviewed by hand to the date at the top of this page. The Ninth Circuit appeal is active, so this is a fast-moving posture — confirm the current position against CARB before relying on it for a filing decision.
What the calculator deliberately does not do
The tool does not estimate emissions, draft a risk report, run scenario analysis, or file anything. It scopes coverage: revenue and California nexus in, applicable laws, report obligation, and deadline status out, annotated with the SB-261 stay. The risk report SB-261 ultimately requires is built separately to TCFD or IFRS S2, supported where needed by the linked scenario-analysis tool.
Versioning
The threshold and cadence parameters are read from the Master Brain (v2025.62), which stamps each result with the dataset version. The legal status and the deadline can change between Master Brain releases — a Ninth Circuit ruling on the appeal or a new CARB alternate date could move them at any time. Re-confirm the status against CARB, and re-run coverage against the current dataset, before treating any output as current. The full methodological treatment is on the paired California climate-disclosure methodology page.
Frequently asked questions
Any business entity with total annual revenue over $500 million that does business in California is a covered entity under SB-261, regardless of where it is incorporated or headquartered. The law covers both public and private companies — there is no public-company requirement and no private-company exemption, though insurers already reporting under the National Association of Insurance Commissioners climate framework are carved out. Coverage turns on revenue plus California business activity, not on headquarters location. Companies above $1 billion also pick up the companion SB-253 emissions obligation.
SB-261’s enforcement is currently stayed. In November 2025 the Ninth Circuit granted an injunction pausing enforcement of the SB-261 deadline pending an appeal by business groups; the court heard oral argument in January 2026 and has not yet ruled. The statute itself is not repealed — CARB has opened a voluntary docket and will set an alternate SB-261 reporting date once the appeal resolves. The companion law SB-253 was not enjoined, so its emissions obligation proceeds while the SB-261 risk-report deadline waits on the court. Confirm the current position against CARB before relying on it.
SB-261, the Climate-Related Financial Risk Act, requires a climate-related financial-risk report aligned to TCFD or IFRS S2, published biennially, for companies above $500 million in revenue. SB-253, the Climate Corporate Data Accountability Act, requires a greenhouse-gas emissions inventory (Scope 1, 2 and later 3) under the GHG Protocol, reported annually and third-party assured, for companies above $1 billion. SB-261 produces a narrative; SB-253 produces a number. A company between $500 million and $1 billion owes only the SB-261 report; a company above $1 billion files both.
Possibly yes. SB-261 does not care where a company is incorporated or headquartered — coverage turns on total annual revenue plus “doing business in California.” An out-of-state company with California sales, property, or payroll above the relevant tax-code thresholds is doing business in the state and can be fully covered. Because the revenue test uses total revenue rather than California revenue, a company with modest California activity but large global revenue can be a covered entity under SB-261.
The report describes the entity’s material climate-related financial risks — both physical and transition — and the measures adopted to reduce and adapt to them, following the TCFD framework or an equivalent such as IFRS S2. In practice it is structured around TCFD’s four pillars: governance, strategy, risk management, and metrics and targets. It is a narrative disclosure, not a greenhouse-gas inventory; SB-261 does not require a full emissions count, which is SB-253’s requirement. The report is published on the entity’s website on a biennial cadence.
No. SB-261 is a climate-risk disclosure law, not an emissions-reporting law. It asks for a narrative report on climate-related financial risks and the company’s response, aligned to TCFD or IFRS S2 — not a quantitative Scope 1, 2, and 3 greenhouse-gas inventory. The emissions inventory is required by the companion law SB-253, which applies at a higher $1 billion threshold. A company between $500 million and $1 billion owes the SB-261 risk report without owing any emissions inventory under the California regime.
SB-261 set a statutory first deadline of 1 January 2026 for the climate-risk report, published every two years thereafter. That deadline is currently stayed by the Ninth Circuit injunction granted in November 2025, so CARB is not enforcing it while the appeal is pending; CARB has opened a voluntary docket and will set an alternate date once the court rules. A covered company should treat the deadline as deferred rather than cancelled, file voluntarily if it chooses, and plan for the alternate date that follows the appeal. Confirm the current deadline against CARB.
SB-261 authorises administrative penalties up to $50,000 per reporting year for violations such as failing to publish a required climate-risk report. CARB weighs the violator’s compliance history and good-faith efforts when setting a penalty. Because the Ninth Circuit injunction currently stays SB-261 enforcement, no penalty presently attaches for non-filing — but that can change quickly if the appeal resolves and CARB sets an alternate deadline. The companion SB-253 emissions law carries a separate ceiling of $500,000 per reporting year and is not stayed.
SB-261 references the TCFD framework, but TCFD as a standing body dissolved in 2024, with the ISSB’s IFRS S2 standard taking over as the successor. CARB’s guidance accommodates reporting against TCFD or an equivalent, and IFRS S2 is the natural equivalent because it carries TCFD’s four-pillar architecture forward. Most companies building a SB-261 report today structure it to IFRS S2, which satisfies the TCFD-aligned requirement while aligning with the standard most other jurisdictions are adopting. The underlying four pillars — governance, strategy, risk management, metrics and targets — are common to both.
Methodology notes and limitations
Coverage tool, not a report engine. The calculator resolves coverage under SB-261 from total annual revenue and California nexus, flags the SB-253 escalation above $1 billion, and maps coverage to the report obligation, cadence, and deadline status. It does not draft the climate-risk report, run scenario analysis, or file anything. The report SB-261 requires is built separately to TCFD or IFRS S2.
Status and deadline are stated to the review date. SB-261’s 1 January 2026 statutory deadline is stayed under a November 2025 Ninth Circuit injunction; CARB has opened a voluntary docket and will set an alternate date after the appeal, which was argued in January 2026 with no decision yet. This is a fast-moving posture — the date and litigation status are hand-reviewed and should be confirmed against CARB before any filing decision.
Threshold and cadence are read live; the deadline, status and penalty are not. The $500 million and $1 billion revenue triggers and the SB-261 biennial cadence are queryable fields the engine reads from the Master Brain (reporting.sb_253_261.*, outside_scopes framework markers). The Master Brain carries no calendar-day, status, or penalty field — the 1 January 2026 deadline, the Ninth Circuit stay, and the $50,000 penalty ceiling are hardcoded from the statutory text and CARB filings.
Coverage turns on total revenue plus California nexus. The revenue test uses total annual revenue, not California revenue; the nexus test uses California business activity. Headquarters and incorporation location are irrelevant. CARB ties the revenue measure to the California Revenue and Taxation Code gross-receipts concept. The engine resolves coverage from a numeric revenue input plus a boolean nexus confirmation; it cannot itself test “doing business in California,” which is a legal determination the user attests to.
A narrative report aligned to TCFD or IFRS S2. SB-261 requires a climate-related financial-risk report on the entity’s physical and transition risks, structured around TCFD’s four pillars. TCFD dissolved in 2024 and IFRS S2 is its successor; a report structured to IFRS S2 satisfies the TCFD-aligned requirement. SB-261 does not require a greenhouse-gas inventory.
Worked example is illustrative. The $720 million software-company example shows coverage logic in the SB-261-only band ($500M–$1B), from revenue and nexus, not a risk or emissions computation, because the tool scopes obligations rather than measuring them.
The dataset and the law both change. The Master Brain parameters are versioned; the legal status and deadline can change between releases. Re-confirm against CARB and re-run coverage against the current dataset. The full methodological treatment is on the paired California climate-disclosure methodology page.