38534.
(a) This section shall be known, and may be cited, as the California Contractor Climate Transparency Act.
(b) For purposes of this section, the following definitions apply:
(1) “Climate-related financial risk” means material risk of harm to immediate and long-term financial outcomes due to physical and transition risks, including, but not limited to, risks to corporate operations, provision of goods and services, supply chains, employee health and safety, capital and financial investments, institutional investments, financial standing of loan recipients and borrowers, shareholder value, consumer demand, and financial markets and economic health.
(2) “Large contractor” means any company doing business within the state as a vendor, contractor, or procurer that received more than twenty-five million dollars ($25,000,000) in state contract obligations in the prior state fiscal year.
(3) “Reporting entity” means a large contractor or a significant contractor. Applicability shall be determined based on the reporting entity’s state contract obligations in the prior state fiscal year.
(4) “Scope 1 emissions” means all direct greenhouse gas emissions that stem from sources that a reporting entity owns or directly controls, regardless of location, including, but not limited to, fuel combustion activities.
(5) “Scope 2 emissions” means indirect greenhouse gas emissions from consumed electricity, steam, heating, or cooling purchased or acquired by a reporting entity, regardless of location.
(6) “Scope 3 emissions” means indirect upstream and downstream greenhouse gas emissions, other than scope 2 emissions, from sources that the reporting entity does not own or directly control and may include, but are not limited to, purchased goods and services, business travel, employee commutes, and processing and use of sold products.
(7) “Significant contractor” means any company doing business within the state as a vendor, contractor, or procurer that received between five million dollars ($5,000,000) and twenty-five million dollars ($25,000,000) in state contract obligations in the prior state fiscal year.
(c) Beginning January 1, 2027, one year after the effective date of regulations adopted pursuant to paragraph (1) of subdivision (c) of Section 38532, the state board shall require a large contractor and a significant contractor to report the following information annually:
(1) For large contractors, annual disclosure of scope 1 emissions, scope 2 emissions, scope 3 emissions, and climate-related financial risk, in alignment with Sections 38532 and 38533 and associated implementing regulations to ensure consistency in greenhouse gas emissions reporting.
(2) For significant contractors, annual disclosure of scope 1 emissions and scope 2 emissions, in alignment with Section 38532 and associated implementing regulations to ensure consistency in greenhouse gas emissions reporting.