ExxonMobil Sues California Over Climate Disclosure Laws Citing Free Speech Concerns

Hadisur Rahman, JadeTimes Staff

H. Rahman is a Jadetimes news reporter covering Business

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Image Source: Brandon Bell | Getty Images

ExxonMobil has filed a lawsuit against the state of California, arguing that two climate disclosure laws enacted in 2023 violate its constitutional rights by forcing it to adopt what it calls a politically motivated narrative about corporate responsibility for climate change.

The Texas-based energy giant submitted its complaint on Friday in the U.S. District Court for the Eastern District of California, seeking to block the laws from taking effect next year. The company contends that California’s new reporting mandates unfairly target large corporations and compel speech that aligns with the state’s policy views on climate accountability.

Under Senate Bill 253, companies with significant operations must publicly disclose extensive data on greenhouse gas emissions, including both direct and indirect sources such as employee travel and product distribution. ExxonMobil argues that this framework unjustly “places disproportionate blame on large companies” and is designed to shame major emitters rather than provide balanced transparency.

The company also challenges Senate Bill 261, which requires firms earning over $500 million annually to report how climate change could impact their financial performance and what measures they plan to take in response. ExxonMobil says the law forces it to “speculate about unknowable future developments” and publish uncertain forecasts on its website, which it views as compelled speech.

California officials have defended the legislation, saying it promotes accountability and informed decision-making among investors and the public. A spokesperson for Governor Gavin Newsom called ExxonMobil’s opposition “shocking,” emphasizing that transparency is essential in addressing the global climate crisis.

The lawsuit sets the stage for a significant legal confrontation over how far states can go in mandating corporate climate disclosures, testing the balance between environmental policy, business regulation, and constitutional rights.