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International Sustainability Standards Board (ISSB) will take over the Task Force on Climate-related Financial Disclosures (TCFD) role in monitoring companies' progress on climate-related disclosures. The Task Force on Climate-related Financial Disclosures (TCFD) is a set of guidelines to help companies disclose climate-related financial risks and opportunities to investors, lenders, insurers, and other stakeholders. More than 2,000 companies around the world use TCFD guidance to report on their climate governance and strategy, including 83 of the world's largest corporations. THE RECENT UPDATE: This development aligns with ongoing efforts at the federal level as the SEC prepares to finalize climate-related disclosure rules for companies trading in the US markets. Notably, California's legislation surpasses the proposed SEC rules in comprehensiveness, extending its scope to cover all large companies, not just public ones. Additionally, as the 4th largest economy in the world, California will move the nation forward on mandated reporting regardless of the SEC's final ruling due to its reach and impact across state lines with many companies doing business, at least in part, in California. SASB (Sustainability Accounting Standards Board) SASB is now part of the International Sustainability Standards Board (ISSB) where its industry-specific standards are playing an important role in the great work the ISSB is doing. THE RECENT UPDATE: CALIFORNIA CLIMATE DISCLOSURE RULES Climate Corporate Data Accountability Act (SB 253) and the Climate-Related Financial Risk Act (SB 261) THE RECENT UPDATE: California's SB 253, the Climate Corporate Data Accountability Act, just passed a pivotal Assembly vote in September 2023. ABOUT While the SEC's Climate Disclosure Rule is still yet to be finalized, California is preemptively changing the ESG landscape in the U.S. by approving the Climate Corporate Data Accountability Act (SB 253) and the Climate-Related Financial Risk Act (SB 261). The landmark disclosure bill will force over 5,000 large public and private companies to disclose scope 1, 2, and 3 emissions. The inclusion of both public and private companies is unique, as is the requirement for scope 3 disclosure among US states. It's a landmark step towards emissions transparency in the U.S. that will help markets, customers, and policymakers make better-informed decisions on climate. IMPORTANT TO KNOW NEXT STEPS Scope 3 is a major point of contention that could tie up the bill in the courts. Governor Newsom has until October 14 to sign or veto these bills. If they become law, they will largely supersede the long- awaited SEC rule.

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