Legal Slice

During recent years, businesses have undertaken ESG initiatives. However, the risk of litigation related to these efforts has never been higher. ESG litigation is on the rise, with private litigants and government agencies challenging ESG initiatives. The recent U.S. Supreme Court decision in Students for Fair Admissions v. Harvard has further fueled litigation, with private litigants using the Court's reasoning to challenge corporate diversity, equity, and inclusion efforts. Companies are facing challenges to their hiring initiatives and board diversity policies. Shareholder lawsuits have also been filed against companies for their commitment to diversity and equity. In response, some companies are adopting a "greenhushing" approach, staying silent about their environmental goals to avoid litigation. However, this deprives companies of the benefits of public pronouncements of ESG programs. Companies are also advised to carefully substantiate their environmental claims and avoid making misleading or overstated claims. Language matters, as marketing words like "clean" and "sustainable" can lead to false advertising claims. Companies should carefully consider their public statements and assess the potential risks and benefits of ESG efforts. Steve Blonder, a legal and business counselor, advises companies to be environmentally responsible while navigating the legal landscape.