California Pols Eye Corporate Emissions, Climate Risks (1)
A handful of bills making their way through the California legislature means growing interest in businesses making money in the world’s fifth-largest economy and how their operations contribute to emissions that exacerbate climate change.
California politicians want to demand well-known brands like
Some bills also require companies to consider their financial risk from climate change related to assets, weather events, new laws and other regulations that could be passed to reduce risk. At least one of the bills would be the first of its kind in the country if it were to become law.
“It’s good that there are several members working in this space. It’s powerful, ”said Senator Scott Wiener (D), who drafted one of the bills, the Climate Corporation Accountability Act.
Representatives of Apple, Walt Disney,
The California Chamber of Commerce, which has not listed any of the bills on its list of laws it supports or opposes, did not immediately respond to a request for comment. The California Business Roundtable, which said in January that Wiener’s bill would increase the cost of doing business in California, also did not respond.
Wiener’s invoice, SB 260, would require public emissions disclosures from companies doing business in California with more than $ 1 billion in annual revenues.
The disclosures would include carbon emissions from power and electricity at company facilities, as well as indirect emissions from non-core functions along the supply chain. Companies should also set science-based reduction targets. More than 5,000 companies, including
“You can’t just regulate California emissions and protect California and its people from the ravages of climate change, because greenhouse gas emissions know no borders,” said Catherine Atkin, co-director of Carbon Accountable, the one of the sponsors of SB 260. “If you benefit from the generosity of California as a market, you have to be a responsible player. “
Other bills address the financial risks associated with forest fires, erosion, extreme weather conditions, sea level rise and other climatic effects.
SB 449 by Senator Henry Stern would require banks, corporations, credit unions, real estate investment trusts, mortgage lenders and other business-related entities to prepare and publish reports on climate-related financial risks online. It would also require the governor to create a working group on climate change financial risks by 2023 to assess the risks these entities face.
Assembly member Jesse Gabriel (D) modeled his bill, AB 766, off the failure of Senator Elizabeth Warren’s (D-Mass.) Climate Risk Disclosure Act of 2019 About 360 companies and businesses would be affected.
Gabriel’s bill would direct the California Air Resources Board to create reporting rules for the disclosure of direct and indirect greenhouse gas emissions, establish a social cost of the carbon metric, and require analysis climate scenarios. The declaration would begin in 2025, with companies with fossil fuel assets facing additional requirements.
The rule would apply to public companies with executive offices in California and annual revenues of more than $ 100 million. The state would also be required to assess climate risk when issuing bonds.
“There are extreme risks to our financial system,” Gabriel said. “Our feeling is that it is not properly captured.”
Federation of Legsilation
Washington is paying attention to the issue.
Representative Nydia Velazquez (DN.Y.) presented on March 10 a invoice (HR 1`780) which would order the Securities and Exchange Commission to require public companies to disclose in annual reports to shareholders the actions taken to meet the greenhouse gas emissions targets set out in the Accord. Bets on the climate.
Paris Agreement Disclosures Act would create standardized reports and help encourage investors to look at climate action when investing, his office said in a press release.
The Institute for Policy Integrity at New York University Law School and the Environmental Defense Fund published a report in February, saying the SEC should mandate climate risk disclosure rather than relying on existing voluntary reporting.
The report cites another to study who found that 215 of the world’s largest companies have a combined potential of $ 1 trillion in climate-related risk over the next five years.
California bills are unique and states can lead to SEC action, especially in terms of emission reduction requirements, said Sarah Ladin, an attorney at the Institute for Policy Integrity who contributed to the writing the study.
“I think states have a role to play in determining what to do once this information has been provided,” she said.
California and New York tend to be leaders in this area, Ladin said. The New York Civil Service Commission began in October to review requiring investor-owned utilities to disclose the risks climate change poses to businesses, investors and customers.
A spokesperson for the agency did not immediately respond to questions about the state’s position in the process.
“They have a responsibility”
Larger companies can pollute on a larger scale, forcing them to be more responsible, supporters of the bill say.
A 2020 climate responsibility institute report found that between 1965 and 2018, the world’s 20 largest oil, coal and natural gas companies emitted 493 billion tonnes of carbon dioxide and methane, equivalent to 35% of all emissions from fossil fuel and cement operations since 1965. global listing: Chevron USA based in San Ramon, California.
“These biggest companies are the ones that create a global economy,” Atkin said. “They have a responsibility to reduce greenhouse gas emissions for the good of the world, but also for California.”
Two of the bills have committee hearings scheduled for April. Gabriel said he sees his bill, which is pending a hearing date, as an example of push policy and a starting point.
“We know it’s a hot topic and it’s a way for California to energize it,” he said. “The intention is to have these companies grapple with their choices.”