New Analysis Of California's Top Suppliers Points To Impact Of Proposed Climate Reporting Mandates

(MENAFN- PR Newswire) The report – "California Supply Chain: Current Practices & Trends in Climate Disclosure" – is the first industry-wide benchmark assessing how major suppliers to the State -representing billions of dollars in procurement spend-are aligned with its ambitious climate strategy, including regulations such as SB 253 ( Climate Corporate Data Accountability Act ), SB 261 ( Climate-Related Financial Risk Act ), and the newly introduced, supplier-focused SB 755 ( California Procurement Climate Information Act ). SB 755 would require suppliers with over $25 million in state contracts to report their climate-related financial risks and Scope 1-3 GHG emissions, and suppliers with $5 to $25 million in State contracts to report their Scopes 1-2 emissions.

While not all the suppliers included in this analysis are in scope for SB 253 and SB 261, most would be required to report under SB 755. The research finds low voluntary reporting rates among current suppliers, indicating a lack of readiness to comply with the proposed regulation and pointing to the potential level of transparency to be gained through mandated reporting. An increase in awareness of its supplier base's climate disclosures would support the ability of California to reduce emissions and address climate risk across its supply chain.

"California is leading the way in climate disclosure policy, but our research shows that its supplier base largely is not yet aligned with climate disclosure expectations" said Louis Coppola, CEO & Co-Founder at G&A Institute. "With SB 755 on the horizon, we now have a critical baseline to measure progress over time. It's a tool for policymakers, procurement teams, and suppliers themselves as they navigate this rapidly evolving regulatory landscape."

Key Findings

Most of CA's top suppliers don't report climate data.

• 25% disclose Scopes 1 & 2 emissions
• 18% report Scope 3 emissions, the largest portion of most companies' carbon footprints

Assurance and target-setting by CA suppliers lags behind expectations.

• 10% obtained third-party assurance for their reported GHG emissions.
• 11% have set science-based emissions reduction targets.

Climate risk assessments remain a blind spot for CA suppliers.

• 17% conducted a climate-related risk assessment aligned with the Task Force on Climate-related Financial Disclosures (TCFD).

These rates suggest state agencies, procurement teams, and policymakers should proactively drive supplier readiness by providing guidance on the specific requirements of each bill and their applicability, education on the complexities of climate reporting, and support for accurately measuring emissions and conducting climate-related risk assessments.

Establishing a Baseline for Future Progress

This new research provides a baseline for measuring progress in the years to come. As California's climate regulations evolve, this analysis can be updated annually to track improvements, identify remaining gaps, and measure the impact of policies like SB 253, SB 261, and SB 755.

The report enables:

• Procurement teams to assess supplier progress and refine engagement strategies.
• Suppliers to benchmark their progress against their industry peers and make strategic and targeted improvements.
• Policymakers to track the effectiveness of climate laws and adjust guidance as needed.

"This report is an important resource for California policymakers and taxpayers and demonstrates the continued importance of ensuring that companies manage, measure, and disclose their climate-related risks and opportunities." – Ceres

"Suppliers must do their part to help California achieve its ambitious climate goals. This analysis helps clarify where industry gaps exist and where targeted action is needed."
– Carbon Accountable

"Persefoni is a carbon accounting and management platform that regularly supports customers as they examine their own supply chain risks and supplier specific emissions. Large institutional buyers - governments, universities, healthcare systems, corporations - are increasingly looking to suppliers to help assess and manage climate-related financial risks. This includes whether suppliers measure their own GHGs or consider potential disruptions to their own operations. Everyone is someone's Scope 3, so all companies must be ready to provide emissions data and climate risk analysis. We're only as resilient as our weakest supplier." – Mike Wallace, Chief Decarbonization Officer, Persefoni

What's Next?

SB 755 is poised to bring even more suppliers into California's climate disclosure framework. Analysis of the kind presented in this new report will be an essential tool for tracking progress, guiding industry engagement, and ensuring companies are prepared for increasing transparency demands.

Download the report at:

About the Supporters

Ceres
Ceres Accelerator for Sustainable Capital Markets is a center within Ceres that aims to improve the practices and policies that govern capital markets by engaging federal and state regulators, financial institutions, investors, and corporate boards to act on climate risk as a systemic financial risk.

Carbon Accountable
Carbon Accountable advances policies that increase the availability of the robust GHG emission data needed to inform corporate and investor decision making and empower consumers and policymakers.

Persefoni
Persefoni is a leading climate management and carbon accounting platform that enables businesses to track, manage, and disclose their carbon footprints in alignment with global standards.

About G&A Institute, Inc.

Founded in 2006, Governance & Accountability Institute, Inc. (G&A) is a sustainability consulting and research firm headquartered in New York City. G&A helps corporate and investor clients recognize, understand, and develop winning strategies for sustainability and ESG issues to address stakeholder and shareholder concerns. G&A's proprietary, comprehensive full-suite process for sustainability reporting is designed to help organizations achieve sustainability leadership in their industry and sector and maximize return on investment for sustainability initiatives.

Since 2011, G&A has been building and expanding a comprehensive database of corporate sustainability reporting data based on analysis of thousands of ESG and sustainability reports to help steer strategy for our clients and improve their disclosure and reporting. More information is available on our website at ga-institute .

SOURCE Governance & Accountability Institute

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