ExxonMobil Sues California Over Climate Disclosure Laws
ExxonMobil filed a lawsuit today against the state of California, challenging laws requiring comprehensive greenhouse gas emissions reporting and disclosure of climate-related financial risks to investors.
The oil and gas company alleges the two laws, passed in 2023, violate the First Amendment by compelling the company to adopt the state’s views on climate change and “embarrass” corporations deemed responsible for emissions. ExxonMobil claims it already publicly shares emissions data but disputes the methodologies used in the Greenhouse Gas Protocol, particularly regarding indirect emissions from supply chains and product use – which can represent the majority of a company’s carbon footprint. SB 253 would require full disclosure of these indirect emissions by 2027. The suit also challenges SB 261, which mandates disclosure of financial risks posed by climate change, calling such assessments “speculative.”
These legal challenges arrive as companies face increasing pressure to be transparent about their environmental impact; similar federal rules proposed by the Securities and Exchange Commission (SEC) were weakened after industry pushback and are no longer being defended by the current administration. California’s actions are part of a broader effort by states to address climate change independently, even as federal policy shifts. ExxonMobil is also currently involved in separate litigation with California over alleged deception regarding plastic recycling and broader claims of deceptive practices contributing to climate change impacts, including increased wildfires and droughts – a case mirroring similar lawsuits against other energy companies.
“These laws are about transparency. ExxonMobil might want to continue keeping the public in the dark, but we’re ready to litigate vigorously in court to ensure the public’s access to these important facts,” stated Christine Lee, a spokesperson for the California Department of Justice. Officials with the state regulatory agency named as defendants declined to comment on pending litigation.
