California’s climate disclosure rules are here. Beginning in January 2026, thousands of companies will need to publish disclosures on climate risk (SB 261) and carbon emissions (SB 253) with the same rigor as their financial reporting. More detail on the rules.
At Watershed, we power carbon data and disclosure for hundreds of organizations that are in scope for these rules, including 70 of the Fortune 500. Watershed’s audit-grade scope 1-3 measurement, California report builder, and expert guidance make it easy to report with rigor.
Today, we’re announcing two major updates to our California solution:
- AI-accelerated reporting for SB 261 to help companies publish climate risk reporting ahead of the January deadline.
- Guaranteed Assurance program for SB 253 to ensure emissions data passes third-party verification required by the law.
AI-accelerated reporting for SB 261
SB 261 requires companies to publish climate risk disclosures, aligned to TCFD or ISSB frameworks, by January 1, 2026.
Watershed’s AI-accelerated reporting makes it easy to get this right. Using existing inputs—like CDP responses or a climate risk assessment—Watershed generates structured report drafts aligned to TCFD’s four pillars: governance, strategy, risk management, and metrics & targets. Watershed’s AI is uniquely built with encoded sustainability intelligence. It’s an expert on the policy requirements and public reports from your peers, and has context on the data you’ve uploaded in Watershed. That means it produces a strong first draft, flags gaps, and shows where you stand relative to peers—so your team can fine-tune and finalize instead of starting from scratch.
All of this is accompanied by the enterprise-grade control and human review you need for a regulatory filing:
- Transparency: every statement is cited back to source data, with a complete change log.
- Collaboration: assign sections, track revisions, and manage approvals across teams.
- Human review: Watershed’s climate and policy experts can work with you to finalize your report.
Reach out or join our webinar on October 21 to see this product live.
Guaranteed Assurance program for SB 253
SB 253 requires companies to disclose their carbon emissions with independent third-party assurance. This is a high bar, and it’s important for companies to have numbers their CFO can stand behind.
Watershed is designed for assurance from the ground up:
- 150 detailed error checks to safeguard against 70+ types of errors.
- Full data lineage and calculation transparency for every data point.
- Methodologies developed by scientists and audited annually by independent verifiers.
- Footprint review by a sustainability data expert before your submission.
Today, we’re going a step further. We’re announcing our Guaranteed Assurance program for SB 253 to give companies total peace of mind on assurance.
Here’s how it works: when you sign up for the program, Watershed experts will work with you and your auditor through every step of the assurance process—and continue working with you until you pass. We stand behind that commitment: if your company doesn’t pass assurance as required by SB 253, Watershed will waive up to $250,000 in fees for the following year. We’re committed to helping every company approach California’s new requirements with confidence.
Available to customers who use our standard auditor-approved methodologies and Verification Support package. More details here.
SB 253 Update: On October 10th, 2025 CARB released a reporting template for SB 253. Details on the template can be found here. Watershed is integrating the template directly into its report builder for SB 253, so you'll have the latest CARB guidance incorporated.
Get ready for California—and beyond
With Watershed, companies can:
- Draft SB 261 climate risk disclosures faster, with AI-accelerated reporting and expert review.
- Prepare SB 253 emissions reports aligned with CARB’s template, backed by our Guaranteed Assurance program for SB 253.
- Stay ahead of evolving CARB guidance with proactive updates from our team and in-line guidance as you draft your report.
- Manage global compliance needs in one place.
The January 2026 deadline for California compliance is fast approaching. Reach out if you’d like to chat with an expert and join our webinar on October 21 to see how Watershed can help you accelerate SB 253 and SB 261 reporting.
