The Promise and Perils of Promoting ESG With Demand-Side Regulation

By Thilo Kuntz January 24, 2024 by renholding

In recent years, regulators and other proponents of greater corporate attention to environmental, social, and governance (ESG) factors have treated boards of directors as, in effect, supplying ESG, making the decisions that take ESG into account. Yet there are obvious …

How Stressing ESG Affects Firm Value

By Sonam Singh, Ashwin V. Malshe, Yakov Bart and Serguei Netessine January 17, 2024 by renholding

The intersection of business and sustainability has undergone a transformative shift in recent years. Once relegated to the periphery of corporate consciousness, environmental, social, and governance (ESG) factors are now at the forefront of companies’ strategic considerations. Yet they raise …

What Explains the Rise of ESG Assurance?

By Shawn Shi January 16, 2024 by renholding

Over the last decade, investors and other stakeholders have demonstrated a preference for firms that embrace good environmental, social, and governance (ESG) practices. It is natural, therefore for firms to try to improve their ESG profiles through ESG disclosures. The …

Wachtell Lipton Discusses Key Issues in Corporate Governance for 2024

By Martin Lipton, Steven A. Rosenblum, Karessa L. Cain and Carmen X.W. Lu January 10, 2024 by renholding

Over the past year, expectations for directors have continued to evolve, bringing new challenges and responsibilities to the boardroom. The remarkable speed, volume and proliferation of channels through which information travels today continue to place more scrutiny on boards and

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Delaware Vice Chancellor Travis Laster Says Bill Barr Could Use Some Help on Delaware Law

By J. Travis Laster December 7, 2023 by renholding

The universe regularly provides reminders to remain humble, including reminders that having expertise in one area does not make you an expert in adjacent areas. Former Attorney General Bill Barr recently provided one of those reminders with his opinion column

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ISS Discusses New UK Strategy for Sustainable Finance

By Hugo Gallagher December 5, 2023 by renholding

The U.K. Government published its updated Green Finance Strategy in March 2023. Comprehensive in nature, the Strategy articulates the U.K.’s ambition to become a world leader in the realm of sustainable finance and to retain the country’s status as a …

Debevoise Discusses SEC’s Division of Enforcement Year-End Results

By Kara Brockmeyer, Andrew Ceresney, Robert Kaplan, Julie Riewe and Mary Jo White November 30, 2023 by renholding

On November 14, 2023, the U.S. Securities and Exchange Commission’s (“SEC” or “Commission”) Division of Enforcement (“Division”) announced its enforcement results for fiscal year (“FY”) 2023.[1] Disgorgement and penalties were the second highest in the SEC’s history at just …

Will Systematic Stewardship Save the Planet?

By Zohar Goshen and Assaf Hamdani November 28, 2023 by renholding

The convergence of environmental urgency and the rising power of “universal owners” – asset managers with broad-based portfolios, such as BlackRock – has kindled the hope among academics and activists that universal owners will leverage their power to push companies …

What Many Financial Economists Misunderstand About Divestment Campaigns

By Emilio Marti, Martin Fuchs, Mark R. DesJardine, Rieneke Slager and Jean-Pascal Gond November 27, 2023 by renholding

Sustainable investing is becoming a hot topic in financial economics. However, when it comes to the impact of divestment campaigns and related tactics on promoting sustainable investing, financial economists miss an important point. Many assume that shareholders can create impact …

Skadden Discusses Different Enforcement Approaches of EU, UK, and U.S. on Antitrust and Sustainability

By Aurora Luoma, Giorgio Motta and Boris Bershteyn November 16, 2023 by renholding

On October 12, 2023, the UK’s Competition and Markets Authority (CMA) issued its final Green Agreements Guidance (Guidance). The Guidance is designed to help businesses seeking to collaborate on environmental sustainability initiatives by providing greater clarity on when UK competition …

SEC Announces Enforcement Results for Fiscal Year 2023

By Securities and Exchange Commission November 15, 2023 by renholding

The Securities and Exchange Commission announced that it filed 784 total enforcement actions in fiscal year 2023, a 3 percent increase over fiscal year 2022, including 501 original, or “stand-alone,” enforcement actions, an 8 percent increase over the prior fiscal …

ISS Discusses Where ESG Performance Matters Most for Company Valuation

By Loic Graindorge, Karsten Greye, Roberto Lampl, Gavin Thomson, Casey Lea and Disha Malara November 9, 2023 by renholding

The January 2023 report ESG Performance and Enterprise Value: Do Firms with Stronger ESG Performance Have Higher Valuation Ratios? investigated the relationship between the ISS ESG Performance Score (a normalized version of the ISS ESG Corporate Rating) and two …

What Is the Global Impact of Mandatory Climate-Related Disclosures?

By Lucas Mahieux, Haresh Sapra and Gaoqing Zhang November 6, 2023 by renholding

In response to extreme weather events, regulators and standard setters are developing climate-related reporting requirements and standards. The thinking behind making disclosure of firms’ climate-related risks mandatory is that it will allow the market to price these risks, thereby using …

Addressing Climate Change Requires Creating Utilities With Purpose

By Joel B. Eisen and Heather E. Payne October 31, 2023 by renholding

Environment, social, and governance (ESG) reporting has become a mainstay of corporate and investment decision-making. Corporations are increasingly making ESG disclosures to assess and limit risks, bolster their reputations, and attract and keep customers. In a new paper, we focus …

Arnold & Porter Discusses ESG, Whistleblowing, and Compliance Programs

By Ellen Kaye Fleishhacker, Jane Norberg, Christian Schultz, Erik Walsh and Michael Treves October 19, 2023 by renholding

On September 25, the U.S. Securities and Exchange Commission (SEC) announced a US$19 million settlement with the investment adviser DWS Investment Management Americas Inc. (DIMA) for material misstatements and shortcomings in its policies and procedures related to Environmental, Social and …

Time to Hold Corporations Accountable for the Human Rights Impacts of Climate Washing

By Randall S. Abate October 4, 2023 by renholding

Corporations have a history of using deceptive tactics to enhance their public image on environmental compliance while advancing their profit-focused objectives. This phenomenon began in the late 1980s, along with the rise of environmental consciousness. A new generation of environmentally …

To Whom Are Caremark Duties Owed?

By Ann M. Lipton October 3, 2023 by renholding

A while ago, the National Center for Public Policy Research – a conservative organization that focuses its advocacy in the corporate and securities space – filed a lawsuit against Starbucks, arguing that its diversity equity and inclusion program ran

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Latham & Watkins Discusses the Proposed ESG Auditing Rule You Know Nothing About

By Sarah E. Fortt and Malorie R. Medellin September 20, 2023 by renholding

On June 6, 2023, the Public Company Accounting Oversight Board (PCAOB), the nonprofit corporation established by Congress to oversee the audit of public companies, proposed new auditing standards designed to further its “investor-protection mandate.”[1]These standards, if adopted, would …

How Competitive Pressure Shapes Firms’ ESG Performance

By Vesa Pursiainen, Hanwen Sun and Yue Xiang September 13, 2023 by renholding

In the face of competitive pressure, is there a trade-off between a company’s financial performance and its commitment to environmental, social, and governance (ESG) activities? Is ESG a source of competitive advantage, or do managers simply spend other people’s money …

Do Employees Value ESG Initiatives?

By Ming D. Leung, Ben Lourie, Chuchu Liang and Chenqi Zhu August 30, 2023 by renholding

While environmental, social, and governance (ESG) initiatives undeniably shape corporate reputations and stakeholder perspectives, a crucial question arises: Does the modern workforce truly value these efforts? At one end of the spectrum, critics argue that employees might prioritize job security, …

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