Which companies in California emit the most pollution? A bill on Gov. Gavin Newsom’s desk would force the list to be made public

First-in-the-nation plan for greenhouse gases is drawing support from Big Tech, opposition from other industries

State lawmakers have sent Gov. Gavin Newsom a bill that would require corporations doing business in California to add up how many tons of greenhouse gases they emit each year and make the information public, in what environmental and industry groups are calling the most significant environmental legislation this year in Sacramento.

The bill, the nation’s first of its kind, is being closely watched in other states and countries.

If signed into law by Newsom, the measure would require approximately 5,300 companies with more than $1 billion in annual revenue — from McDonalds to Walmart, Chevron to Home Depot — to issue annual reports, verified by outside auditors, beginning in 2026.

Researchers, advocacy groups, media outlets, and others could use the data to create “biggest polluter” lists that show which companies emit the most carbon dioxide, methane, and other greenhouse gases that scientists say are contributing to the planet’s steady warming.

“There are a number of corporations that are working very hard to reduce their carbon footprint,” said the bill’s author, State Sen. Scott Wiener, D-San Francisco, on Friday. “There are others who aren’t. Some claim to be environmentally friendly but are anything but. This bill will lift the hood, allowing the public to see who is walking the walk and who is not. It will provide a significant incentive for corporations to take serious steps to reduce their carbon footprint.”

The bill would apply to all large corporations doing business in California, whether their headquarters are in the state or not, and whether they are publicly traded or privately held.

Newsom has not stated whether he will sign it. He is scheduled to speak on Sunday at Climate Week, an annual conference held in New York City in collaboration with the United Nations.

Environmental groups hail SB 253 as a critical step toward addressing climate change by making the largest polluters more transparent.

“If your house is super messy and you’re having people over for dinner, you clean up the dishes, clean the bathroom, and wipe down the counters,” said Mary Creasman, CEO of the Oakland-based nonprofit California Environmental Voters. “This gives businesses an incentive to clean up their act and pollute less.” It’ll spark a race to the top.”

Several industry groups, ranging from oil companies to agricultural interests, have come out against the bill.

California Chamber of Commerce, Western Growers Association, California Restaurant Association, California Trucking Association, and others are among them.

They claim it will raise costs, add red tape, and burden small businesses, which may be required to provide information if they supply goods and services to larger companies. They also argue that it will put California at a competitive disadvantage in comparison to other states. Opponents argue that accurately calculating all emissions is nearly impossible.

“Business leaders and company owners make decisions — including where to locate and expand their operations — based on costs and the ability to be profitable,” said Denise Davis, a spokeswoman for the California Chamber of Commerce. “This is a fundamentally flawed mandate that focuses on data that is either unavailable or will be reported incorrectly.”

The bill, which was approved by the Democratic-controlled Legislature on Tuesday, requires businesses to report emissions from their facilities and electricity sources. The most contentious requirement is that they report emissions from other sources, such as employee commutes, business travel, their supply chain, and emissions when consumers purchase their products.

“Wherever these interest groups can, they are looking to tighten down regulations and tighten down the way our businesses operate and people live in this state,” said Kevin Slagle, a spokesman for the Western States Petroleum Association, which represents large oil companies.

“There is simply no system where you can plug in the data and get the answer,” he added. “Does it count if someone buys a hamburger at McDonald’s and eats it in their car?”

Some major corporations have come out in support of the bill in recent weeks.

They include Silicon Valley behemoths such as Apple, Google, and Microsoft.

“Climate change poses a significant risk to our long-term economic success, impacts the health and livelihood of the communities in which we operate and live, and disrupts the value chains on which we rely,” many corporate supporters wrote in an Aug. 14 letter of support. “However, the full picture of corporate climate emissions currently remains fragmented, incomplete, and unverified.”

Deloitte, Ernst & Young, PwC, and KPMG are among the large accounting firms that have begun to include greenhouse gas reporting among their services.

The Biden administration has proposed a similar rule for all U.S. companies on a national level. However, the US Securities and Exchange Commission has yet to release the regulations, which would affect only publicly traded companies, due to opposition from industry groups.

The European Union is developing similar regulations for 2025.

A related disclosure law has been in effect in the United States for 37 years.

In 1986, President Reagan signed legislation establishing the Toxics Release Inventory. It required large corporations to report to the US EPA every year how many pounds of various toxic chemicals they were releasing into the air and water.

Reporting the releases has helped to reduce pollution, often because companies wanted to avoid negative publicity. According to the EPA, toxic chemical air emissions decreased by 26% from 2012 to 2021, while water discharges decreased by 10%.