ExxonMobil has filed a lawsuit against the state of California, arguing that two of its recently enacted climate disclosure laws violate the company’s constitutional rights. The oil major contends that California’s rules unlawfully compel speech and force companies to adopt the state’s preferred views on climate policy.
The lawsuit, filed in a California federal court, challenges Senate Bill 253 and Senate Bill 261, both signed into law in 2023. SB 253 requires large companies that do business in California to publicly disclose their greenhouse-gas emissions, including indirect “Scope 3” emissions produced across supply chains and product use. SB 261, according to CNBC, requires companies with annual revenue above $500 million to report on the financial risks they face from climate change and their mitigation strategies. Both laws are scheduled to take effect in 2026.
In its complaint, ExxonMobil argues that the disclosure requirements compel it to use California’s preferred reporting frameworks, such as the Greenhouse Gas Protocol, instead of its own industry-developed methods. The company claims this would make it a “mouthpiece for ideas with which it disagrees,” amounting to compelled speech under the First Amendment.
ExxonMobil also contends that the laws apply beyond California’s borders by requiring global emissions disclosures, which it argues conflicts with federal law and exceeds the state’s authority.
California officials, including Governor Gavin Newsom’s office, have defended the legislation. They say the rules are intended to increase transparency and prevent companies from misleading the public about their environmental impact.
The case marks one of the most high-profile legal challenges yet to state-level corporate climate disclosure mandates in the United States.
