Editorial: The climate crisis didn’t take a year off. California lawmakers shouldn’t either
After years of stagnation, last year California legislators made progress in fighting climate change, passing most of Gov. Gavin Newsom’s last-minute proposal for more aggressive action.
But as the end of the current legislative session approaches, 2023 is looking like a do-nothing year. There’s been no major climate action taken, and even a number of modest climate bills have been killed.
But the climate crisis didn’t take the year off and legislators shouldn’t either. They need to muster the votes to pass what remains of a three-bill accountability package awaiting action on the state Assembly floor. The most controversial of those bills, which would have required the state’s two big pension funds to divest from fossil fuel companies, stalled. The two remaining are corporate transparency measures, and of them the most important is Senate Bill 253, which would require large U.S.-based companies that do business in California to publicly disclose their annual greenhouse gas emissions.
President Biden had the opportunity to fix the Trump administration’s decision to keep in place outdated health standards for smog. Instead the EPA is punting its decision about imposing tougher air quality limits until after the 2024 election.
A transparency measure to require corporations to report to the state Air Resources Board may sound like just a record-keeping exercise. But this would be groundbreaking legislation, with the potential to reach far beyond California’s borders by forcing some of the world’s biggest businesses to be honest about the damage they are causing.
The requirements would apply to an estimated 5,400 companies with revenues of more than $1 billion, including Walmart, Apple, ExxonMobil and Chevron.
California has some of the world’s most extensive environmental regulations, but the state cannot achieve its goals to zero-out its greenhouse gas emissions by 2045 without big businesses that are responsible for the bulk of that pollution doing more, and fast. As this year’s record temperatures, smoke-filled skies, hurricanes and flooding have demonstrated, climate change is such a fast-escalating threat that one year of inaction is really a step backward.
It’s becoming clearer to some environmental leaders that fossil fuel companies have no real plans to change in response to the climate crisis. The only way forward is without them.
The bill is up against an intense lobbying push from powerful business interests opposed to it, including the California Chamber of Commerce, which called it an “onerous emissions tracking and paperwork requirement that will increase costs on California businesses.”
It’s obvious why the petroleum industry is among those opposing the legislation and has spent millions this year trying to kill climate legislation in Sacramento. Telling the truth about oil companies’ full impact on the climate crisis will almost certainly make them look worse and increase public pressure on them to change their ways.
But some big companies like Ikea, Microsoft and Salesforce are backing the legislation, arguing that a verified, global standard for disclosure would level the playing field for companies that already publish their full emissions inventories.
This proposal comes at a critical time. Corporate sustainability is under increasing attack across the country as part of a national Republican-led anti-ESG campaign to enact laws limiting the use of environmental, social and governance criteria in investment decisions. And major corporations, from oil companies to Amazon, are backtracking on their climate commitments.
Legislation to force California’s large and public employee pension funds to divest from the top oil and gas companies is a financially prudent move in a world where the impacts of climate change are intensifying.
This bill’s disclosure requirements are broader than those under consideration by the Securities and Exchange Commission, because they would apply to both public and privately held companies. Businesses would have to provide a top-to-bottom picture of the emissions attributable to them, from their supply chains to the end use of their products.
The lack of standardized, public emissions data is easily exploited by companies that can buttress their climate pledges with so many caveats and qualifications that they cover only a fraction of their actual emissions and give an incomplete picture. Requiring emissions transparency is a smart way cut through corporate greenwashing and reveal whether big businesses are actually delivering promised emissions reductions.
Regulators, investors and consumers should not remain in the dark about big businesses’ influence on something as vitally important as the habitability of our planet. But that will continue to be the case as long as their emissions remain hidden in a black box. You can’t manage what you don’t measure.
A similar measure fell just one vote short of passage on the Assembly floor last year. This is an opportunity for the new Assembly speaker, Robert Rivas (D-Hollister), to show leadership by demonstrating that California will continue to act against the climate crisis, whether big corporations like it or not.
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