A few years ago, “what’s your carbon footprint” was the kind of question that showed up in a sustainability report once a year, written by a team that rarely talked to procurement. That’s shifting quickly. Large manufacturers and retailers are asking their suppliers for emissions data as part of routine vendor reviews, and the pressure is coming from new state and international law, not just brand messaging.
Why California Rules Now Reach Companies Everywhere
California’s Climate Corporate Data Accountability Act, known as SB 253, requires companies with more than $1 billion in annual revenue to disclose their greenhouse gas emissions if they do business in the state. Scope 1 and Scope 2 disclosures start in 2026, with Scope 3 following in 2027.
The part that catches people off guard is who this applies to. It doesn’t matter where a company is headquartered. If it meets California’s threshold for doing business in the state, through sales, payroll, or property there, it’s in scope. That means plenty of manufacturers, food and beverage companies, and retailers based in Florida, Ohio, or Texas will need to report, simply because they sell into California.
Scope 3 is the category that matters most for this conversation, and it’s also the hardest to measure. It covers emissions a company doesn’t produce directly but is connected to through its supply chain, things like purchased goods, upstream transportation, and logistics. Under the GHG Protocol, this includes packaging and the equipment used to move product, which is exactly where pallets live.
Why This Becomes Your Problem Too
A company can’t calculate its Scope 3 emissions in a vacuum. It needs data from the vendors and logistics partners it works with. That’s why large buyers are starting to push these questions down the supply chain, asking suppliers directly about packaging materials, reuse rates, and transportation efficiency. If you supply a company that falls under SB 253, expect that request to land on your desk before long, if it hasn’t already.
This is where the difference between single-use wood pallets and a reusable pooled system starts to matter in a very concrete way. A wood pallet that gets used once and discarded carries a different emissions profile than a composite pallet built to be reused hundreds of times through a pooling model. When your customer is trying to build an accurate picture of their upstream logistics footprint, the pallet program you run becomes part of their answer, whether you’ve thought about it that way or not.
A Shorter Note on Europe
If any part of your business touches the EU market, there’s a second regulation worth knowing about. The Packaging and Packaging Waste Regulation, or PPWR, takes effect on August 12, 2026, and sets binding reuse and recyclability targets across packaging types, including for companies outside the EU that place products into that market. This one doesn’t apply to every US company, but if you have customers shipping into Europe, it’s coming up fast and deserves its own conversation.
What to Do Before the Request Lands
You don’t need a finished sustainability report to get ahead of this. A few things are worth doing now.
Start by understanding your own pallet mix. How much of your program runs on single-use wood versus reusable composite, and how many trips does each pallet realistically get before it’s retired? Ask your logistics and packaging vendors whether they can already provide reuse and lifecycle data, since that’s the kind of documentation your customers will eventually want from you. And if procurement teams haven’t asked about this yet, treat that as a head start rather than a sign it won’t happen.
Reporting requirements like SB 253 tend to move slowly until they don’t. Companies that already have good answers about their pallet and packaging programs will spend a lot less time scrambling when a customer’s compliance team sends over a questionnaire.
At RM2, our pooled, reusable pallet model was built around durability and long service life well before emissions reporting became a business requirement. As these rules take hold, that same model gives our customers a clear, well-documented story to tell about their logistics footprint. If you want to talk through what your current pallet program would mean for these conversations, we’re glad to help you think it through.
