California puts AI auditors on a register, and the SEC takes ISS to court (12 September 2026)
Two governance stories landed on the same day this week, and they point in opposite directions. California moved to formalise who is allowed to audit an AI system. The SEC went to court to get inside the machinery of proxy advice. Both are about who gets to mark the homework.
SB 813 and AB 1405 signed on 9 September
Governor Gavin Newsom signed two bills on Wednesday 9 September that together create the first framework in the United States for independent third party assessment of AI systems. SB 813, from Senator Jerry McNerney, sets up a route for independent verification organisations to assess AI systems and models against state law. AB 1405, from Assemblymember Rebecca Bauer-Kahan, creates a state registry of AI auditors with standards for their independence, transparency and integrity.
The dates matter more than the signing. Under SB 813 the California Government Operations Agency has until 1 January 2028 to set the criteria for verification organisations, and the online auditor registry is due by 1 January 2029. After that point an unregistered person or organisation generally cannot conduct an AI audit required to demonstrate compliance with state law.
Newsom framed it as a response to recent incidents: artificial intelligence "holds extraordinary promise, but it must be developed and deployed with meaningful safeguards to protect the public". Both Anthropic and OpenAI backed the legislation, which is itself worth noting, since a registry raises the floor for everyone and raises the cost of entry for small assurance providers.
For companies outside California the practical question is whether your existing AI assurance supplier would qualify. A registry with independence standards tends to disqualify the arrangement where the firm that helped you build the model also signs off on it.
Source: StateScoop, 11 September 2026.
The SEC sues ISS for client and voting data
Also on 9 September, the SEC filed in federal court to force the proxy adviser Institutional Shareholder Services to hand over client level recommendation and voting data covering July 2024 to February 2026. The regulator opened an examination of ISS in March 2026 and issued a formal order of investigation in July after the firm did not comply with its requests. The filing seeks enforcement of an administrative subpoena.
ISS argues the request is unduly burdensome, that it is not obliged to create documents it does not hold in that form, and that client voting strategies are confidential. It has also raised the First Amendment, pointing to the December 2025 executive order targeting proxy advisers. The SEC's answer is blunt: it is "wholly appropriate" to look into whether the advice "is driven by a particular political or policy aim to the detriment of clients' interests".
An ISS spokesperson said complying "would expose ISS and its clients to potential retaliation for their protected speech and voting decisions". However this resolves, it is a live question for any UK or European asset manager that outsources voting recommendations: the data trail behind those recommendations is now something a regulator may demand.
Source: ESG Today, 9 September 2026.
Carbon accounting consolidates again: Greenly buys Normative
On 11 September Paris based Greenly acquired Stockholm based Normative for around €64 million according to French corporate filings cited in media reports. The combined business serves more than 4,000 companies in over 30 countries, with roughly €30 million of combined software ARR and a stated target of €50 million within three years.
It is the fourth deal of its kind this year, after Diginex buying Plan A, Novisto buying Minimum and Green Project Technologies buying Optera. Greenly's chief executive Alexis Normand framed it as infrastructure: "Someone has to build the carbon infrastructure of the twenty-first century: a trusted system measuring emissions consistently across companies."
If you are procuring carbon accounting software, the practical read is that contract terms and data portability now matter more than feature lists. A platform you choose this year has a meaningful chance of being owned by someone else before your reporting cycle ends.
Source: ESG Today, 11 September 2026.
Also this week
Hong Kong said on 8 September that it will expand its sustainable finance taxonomy to cover more climate mitigation, adaptation and transition activities. Taxonomy expansion is unglamorous, but it decides which projects can be financed as green in a major Asian market, and transition activities are the category most European taxonomies have handled worst.
Source: ESG Today, 8 September 2026.