Keeping Your Eye on the ESG Sustainable Development Ball

Authors

Richard J. Sobelsohn

Abstract

Environmental, Social, and Governance (“ESG”) mandates were originally aspirational sound-bites, but now they have become a part of many companies’ mandates. Most recently with some backlash against ESG directives, most organizations are still complying with their original goals, because the economic arguments for having an ESG protocol is still valid. This article discusses what ESG is, how it relates to different types of companies, and most importantly, what legal issues pertain to it.

This Article examines how ESG guidelines pertain to different types of entities, and how these protocols affect everything from contract drafting, construction of a property, operations and maintenance of that property, and supply chain issues. There are sample ESG contract clauses and disclosure statements provided as well. Hypotheticals are included to further clarify the myriad of issues encountered when dealing with ESG legal issues.

Since greenwashing has recently become more important in the legal framework of representing commercial entities, the Article discusses both the issues of greenwashing liability as well as reporting requirements (both for governmental purposes and also with relation to contractual obligations). Representative case law is provided to further clarify the issues with ESG.

Lastly, since many practitioners have a duty of risk management for their clients, the article addresses those issues and adds some compliance tools to satisfy this obligation. In this regard, green lease concepts and checklists are provided.

Although satisfying ESG requirements abound for many companies, it is clear that an attorney representing a party with those mandates has a lot on which they must focus. And since ESG is a fluid and ever-changing concept, keeping up to date on what is required is the best solution to protect a client in this space.

Recommended Citation

Richard J. Sobelsohn, Keeping Your Eye on the ESG Sustainable Development Ball, 128 Dick. L. Rev. 691 (2024).
Available at: https://ideas.dickinsonlaw.psu.edu/dlr/vol128/iss3/3