ESG litigation is on the rise. Stakeholder groups are using litigation – and the threat thereof – to impact an organisation’s ESG strategy and communications.
There have been a number of successes, notably related to the subject of climate change (e.g. the case against Royal Dutch Shell in first instance). At the same time, investors, regulators and society are closely scrutinising organisations’ sustainability policy and targets, and are monitoring the action they undertake – or fail to undertake – to achieve these targets.
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ESG litigation
Stakeholder groups increasingly use litigation – and the threat thereof – to impact an organisation’s ESG strategy and communications. At the same time, investors, regulators and society are closely scrutinising organisations’ sustainability policy and targets as well as the action they undertake – or fail to undertake – to achieve these targets. Against this background, it is important for clients to understand their liability and litigation risks and to ensure that their strategy and documentation are up to standard. This does not only pertain to business lines that have an apparent impact on our environment but applies in general and in respect of specific projects or relationships.
Our team of experts can:
- Provide representation in all tiers of the judicial system, including the Supreme Court, the European Court of Justice and arbitration
- Assist in developing and drafting ESG-related policies
- Identify litigation risks: assess potential risks, for instance relating to climate policy, climate disclosures or supply chain liabilities
- Assess ESG liability: advise on ESG-related liabilities
- Advise on mitigation strategy, including stakeholder engagement
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Greenwashing
Litigation risks posed by greenwashing are on the rise, focussing on parties that may fail to take action to mitigate climate change. The Taxonomy Regulation, the MiFID II framework and other transparency regulations play an important role in this. Banks and investments firms must integrate ESG-related preferences in their services to their clients, while being able to rely on the information published by their target investment companies. The proposed Consumer Empowerment Directive and the Green Claims Directive further underline that meeting ESG is definitively moving from the reputational and stakeholder management area to legal.
Our team of experts can:
- Identify potential greenwashing risks
- Assist in drafting disclosures to mitigate greenwashing risks
- Review client documentation with a view to potential greenwashing claims
- Assist in actual or potential greenwashing-related litigation
