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US Trade Negotiations Influence EU Sustainability
Back in March, Lawrence wrote about the potential for tariffs and trade policy to weaken EU sustainability legislation – particularly, those that impose obligations on non-EU companies. Now, details emerging from the US/EU Framework on an Agreement on Reciprocal, Fair,...

FCA Review Finds Climate Reporting Needs Improvement
Earlier this summer, the UK’s Financial Conduct Authority (FCA) published a review of climate reporting by asset managers, life insurers, and FCA-regulated pension providers. This review found that while mandatory climate disclosures improved risk management practices, the process and outcomes...

New This Week on PracticalESG.com
Notable additions to PracticalESG.com this week are below. Blogs of the week: Another tie between Apple Removes Carbon Neutral Logo From Packaging and Is Antitrust Enforcement Coming for Sustainability Collaborations? 6 new CSRD reports were added this week which can...

Apple’s Carbon Neutral Claim Faces Criticism From German Court
Yesterday, I wrote about Apple dropping carbon-neutral claims from its packaging. While the decision is driven by a new EU directive coming into force, the company was just given another reason to drop the claim. A German court found that...

Carbon Credit Rater Disses Icelandic Direct Air Capture Project
I’m usually cynical and critical of carbon offset projects, but this is going a little too far in my opinion. Trellis reported that “Calyx [an independent rater of carbon credits projects] assigned a Tier 3 rating — the lowest of...

Private Equity Firms Mirror Public Companies In Emphasizing Sustainability Risk, Not Value
A recent paper from Green Buoy and Green Clout – two consulting houses – published interesting findings from their interviews with “nine representatives from seven different private equity firms with a combined total capital raised of over $400 billion and...

Apple Removes Carbon Neutral Logo From Packaging
Back in 2023, Apple made sustainability news with a flashy ad touting its new line of “carbon-neutral” Apple Watches. At the time, I raised concerns about litigation risks posed by the bold statement. Sure enough, the company was hit with...

MIT Study Highlights Unexpected Parallels Between AI and Sustainability, But Not What You Think
Last year, I wrote a handful of blogs (here, here and here) about how AI and sustainability teams could learn from each other in terms of determining, communicating their respective business value – and how to move forward. I saw...

Welcome Our Newest Partner – TRC Companies’ Sustainability Services
We are very pleased to announced our latest partner – TRC Companies, a premier environmental consulting, redevelopment, energy management and project management firm in business for more than 55 years. TRC offers a comprehensive suite of sustainability services designed to...

Is Antitrust Enforcement Coming for Sustainability Collaborations?
Like many things in ESG, antitrust risk is rapidly evolving. Last week at our ESG Litigation Landscape 2025 webcast, we dove into what’s going on with antitrust enforcement. While novel theories are proceeding against financial services firms, some signs should...

Homeland Security Publishes 2025 Update to UFLPA Strategy
The Department of Homeland Security published 2025 Updates to the Uyghur Forced Labor Prevention Act Strategy. The updates add caustic soda, copper, jujubes (red dates), lithium, and steel as high-priority sectors for enforcement and offers other information on identified entities as well:...

New This Week on PracticalESG.com
Notable additions to PracticalESG.com this week are below. Blog of the week: Judge Rules Against Administration’s DEI Guidance 5 new CSRD reports were added this week which can be viewed here. New Webcast: ESG Litigation Landscape 2025 Hot Topics for...

Judge Rules Against Administration’s DEI Guidance
The current administration is pushing hard against DEI in government and business. Building on the Supreme Court’s ruling in Students for Fair Admission v. Harvard, the administration has repeatedly argued that many DEI practices are unlawful. Recently, a U.S. district...

McKinsey’s Tim Koller on Business Fundamentals and Sustainability (Part 1)
Readers who are MBAs or corporate finance aficionados know the name Tim Koller, author of Valuation: Measuring and Managing the Value of Companies – now in its eighth edition. That text is required reading for many university business programs. I...

McKinsey’s Tim Koller Speaks on Business Fundamentals and Sustainability (Part 2)
Continuing my previous post on excerpts from Tim Koller’s recent interview podcast that offer some wisdom for sustainability professionals. On corporate culture around risk: “One of the biases that many large companies have is loss aversion. They weigh losses much...

FASB Issues Tentative Decision on Environmental Credits and Environmental Credit Obligations (Topic 818)
The FASB took on Environmental Credits and Environmental Credit Obligations (ECOs) (Topic 818) at the Wednesday, August 13, 2025 FASB Board Meeting. The notice of the Tentative Decision is here. There is a lot in it, deserving a careful read....

GAO Report: Limited Federal Role in Voluntary Carbon Markets
The same day that FASB agreed on accounting standards updates for carbon offsets and credits, GAO issued a report Carbon Credits: Limited Federal Role in Voluntary Carbon Markets. While FASB’s action makes clear that federal accounting standards do apply to...

EU Adopts Voluntary Reporting for SMEs
The European Commission has officially adopted a recommendation on voluntary reporting for small and medium-sized enterprises (SMEs). These voluntary standards, known as VSMEs, are a scaled-back version of the European Sustainability Reporting Standards (ESRS) used for reporting under the Corporate...

Despite Long Term Low Carbon Plans, Natural Gas to Power AI Data Centers
I’m sure you’ve seen many announcements in the past 24 months or so about impressive plans/investments by tech companies in alternative energy to power the explosive growth in AI data centers. On the surface, that sounds great – but there...

Key Takeaways from Our ESG Litigation Landscape 2025 Webcast
Our Tuesday webcast, “ESG Litigation Landscape 2025,” featured an engaging and informative discussion on the current and future state of ESG litigation. I would like to thank Jacob Hupart of Mintz, Rob Skinner of Ropes & Gray, and Ameena Majid...

New This Week on PracticalESG.com
Notable additions to PracticalESG.com this week are below. Blogs of the week: This week, three blogs topped the charts – Sustainability Financial Disclosure Fears May Be Overblown, SEC Stats Show, 21 States Send Warning Letters to Major Financial Institutions, and The...

The Conference Board: DEI Terminology Down in 10-Ks, But Action Continues
The Conference Board published a new report on the current state of DEI in corporate America. The results show DEI disclosures and executive compensation incentives “declined sharply in 2025 amid legal and reputational concerns”, reflecting a “a strategic distancing away from...

Consumer Trust in Corporate Sustainability Declines
Amidst claims that consumers are making conscious buying decisions based on sustainability, a recent survey show paradoxically that consumers place little trust in company sustainability claims. Sustainability Online reports “Trust in corporate sustainability claims is ‘on a downward slope’, a...

South Carolina Court Strikes Down Climate Suit
In 2020, the city of Charleston, South Carolina, sued 24 fossil fuels companies. The lawsuit sought to recover damages associated with sea level rise around Charleston, alleging the companies were negligent in their emission of CO2. Last week, that lawsuit...

Sustainability Financial Disclosure Fears May Be Overblown, SEC Stats Show
Recently I wrote about our soon-to-be-published study of how/if 113 publicly traded US companies report financial value/gains/benefit of sustainability in their 10-K and/or sustainability/ESG reports. We found that only 27% reported financial value/gains/benefit of sustainability in most recent 10-Ks, with...

New ESRS Standards May Hurt Interoperability with ISSB
Last week, I wrote about the recent ESRS exposure drafts published by EFRAG. In that blog, I note that changes to ESRS were made with interoperability with ISSB in mind. While this is true – and certain portions of the...

21 States Send Warning Letters to Major Financial Institutions
Anti-ESG shows no signs of slowing down. Between the ongoing antitrust litigation in Texas and emerging threats from Florida’s AG, financial institutions are feeling the pressure from anti-ESG. Adding to the trouble is another “warning” letter from 21 state AGs...

A DaVinci Code In Department of Interior Order On Energy Project “Capacity Density”
I found this interesting about the new Order issued by the Department of the Interior (DOI) on use of federal lands for energy projects: “the Department shall consider energy projects’ capacity density in its decision-making, including when considering reasonable alternatives...

German Government Gives Initial Nod to CCS/CCU
Here’s some carbon news from Clean Energy Wire: “The German government cabinet has approved a draft law that would allow the underground storage of CO2 and enable its large-scale transport through pipelines, and thus pave the way for the application...

New This Week on PracticalESG.com
Notable additions to PracticalESG.com this week are below. Blogs of the week: It was another close one – Our Research Is Complete: How Financial Value of Sustainability Is Disclosed (or Not) by Over 110 US Companies, and Florida AG Investigates...

EFRAG Publishes Exposure Drafts for New Scaled Down ESRS
The EU’s Omnibus simplification efforts hit another milestone as EFRAG completed their work on the new European Sustainability Reporting Standards (ESRS). As part of the EU’s efforts to scale back mandatory sustainability reporting, the EU Commission ordered EFRAG to overhaul...

Judge Denies BlackRock’s Motion to Dismiss in Texas Antitrust Case
BlackRock, State Street, and Vanguard have battled an antitrust case in Texas since last year. Earlier this summer, BlackRock filed a Motion to Dismiss in the litigation. Despite the asset manager’s capitulation and withdrawal from the Net Zero Asset Managers...

Sustainable Packaging Initiatives Aren’t Working
Sustainability Magazine had some unwelcome news recently: “Research and advisory firm Gartner predicts that by 2028, 75% of organisations will relinquish their voluntary sustainable packaging objectives and follow just compulsory legislative standards. While companies like Walmart and Unilever set ambitious...

Florida AG Investigates CDP and SBTi over Antitrust Concerns
Anti-ESG has an unorthodox playbook of courtroom strategies. Antitrust is one that has long raised eyebrows among legal experts. While these theories haven’t seen success in the courtroom yet, with only one case being filed in Texas, they are proliferating....

EU Carbon Offset Investigation Targets Specific Employees at Verification Bodies
It has been a minute, so I’m going to write about another carbon offset project scandal – or at least regulatory investigation. This time, it’s personal. Not for me, but for staff at verification bodies. Bloomberg reported “Luxembourg authorities are...

Italy’s Authorities Crack Down on Fashion Industry’s Sustainability Claims
Italian regulators handed down two enforcement actions related to sustainability at companies in – what else?… the fashion and clothing industry. France24 reported that Italy’s competition regulator “fined the company responsible for Shein’s websites in Europe one million euros ($1.15...

Our Research Is Complete: How Financial Value of Sustainability Is Disclosed (or Not) by Over 110 US Companies
Just over a year ago, I began planning a research project to analyze how (or if) companies formally disclose financial gains/ROI of sustainability initiatives and investments. In the intervening months, project details changed somewhat and today the initial draft is...

Beyond Our New Research – Is Sustainability More Than Financial ROI?
I’m certainly excited about our new research on how US companies report financial benefits of sustainability programs. However, my view on the need for an ROI/financial value supporting corporate sustainability programs sometimes comes under fire for taking too narrow a...

New This Week on PracticalESG.com
Notable additions to PracticalESG.com this week are below. Blog of the week: SEC Commissioner Crenshaw Slams SEC’s Update on Climate Disclosure Rule 12 new CSRD reports were added this week which can be viewed here. Hot Topics for the Week:...

A Good Sustainability Business Case Is a Good Legal Defense
Anti-ESG has been busy, and more states are passing and enforcing anti-ESG laws. One of the core arguments used by anti-ESG is that by focusing on ESG factors, companies are diminishing financial returns – a breach of fiduciary duty. The...

Sustainability Report Assurance Popularity Poses Issues for Audit Committees
Advisory Board member and former Chair PCAOB Chair Dan Goelzer offered commentary recently on the popularity of assurance of sustainability reports and what Audit Committees should be thinking about in that regard. He suggests four specific aspects of sustainability report...

Italian Government Enforces Worker Rights at Another Luxury Brand
Luxury brands have faced increasing public pressure concerning worker conditions in supplier facilities. The Business & Human Rights Resource Centre reported that “luxury clothing company Loro Piana (part of LVMH) has been put on judicial administration over the abuse of...

Two International Courts Issue Advisory Opinions on Climate Change
Two international courts issued advisory opinions on the obligations of states to respond to climate change. On July 3, the Inter-American Court of Human Rights published an opinion finding that States have an obligation to mitigate climate change through policies...

Anti-ESG Pushback Isn’t Slowing Down
Trellis wrote lasts week: “70 percent of experts say there’s a significant backlash against the sustainability agenda in their country, up 13 percentage points from 2024. North America is most polarized, with nine in ten experts reporting significant backlash compared...

Could ESG Litigation Break Containment?
The US doesn’t lead in many ESG areas. When it comes to emissions trading, climate reporting, and supply chain management, the US regulatory scheme is lagging or nonexistent. However, the US does prevail in one major area: litigation. I wrote...
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Featured Q&A Members Only
Extent to which diversity must be discussed in proxy statement
It is my understanding that the only requirement as to diversity left for the proxy at this time is in relation to whether the nominating committee considers diversity in selecting directors. If a company, at the last minute out of concern of anti-DEI sentiment, changes its nominating committee charter to remove all reference to considering diversity when selecting directors, does it still need to mention diversity in the proxy as to selecting directors since the charter still spoke of diversity during the past fiscal year?
It appears that under the rule, a company is required to address in the proxy whether it considers diversity among its director nominees, and if so, how it considers diversity. This would appear to indicate that even if a company is concerned over anti DEI sentiment, it still needs to address diversity in the proxy, in terms or whether and how it considers it, even if it is considered in a way that does not involve race or gender.
It is still unclear to me whether a company that updates its charter at the last minute to remove all reference to race and gender in diversity can represent on the proxy that it does not consider race and gender in its diversity assessment. However it is my understanding that because proxies are forward looking, this may be acceptable.
It has also come to my attention that Glass Lewis issued a statement that it is sticking to its diversity expectations unlike ISS. Does this mean that a company that no longer requires race or gender as part of a diversity assessment risks a negative recommendation from GL?
07/8/2025, Question #29424
Removing DEI from SEC 10-Ks
Are companies being advised to not discuss DEI in their 10-Ks due to the executive orders? If a company previously mentioned having a diversity policy and its diversity workforce statistics, is that going to create an issue to now remove them?
05/5/2025, Question #28369
CDP Disclosure Insight Action
We recently received a letter from CDP Disclosure Insight Action requesting that we disclose certain environmental information through their questionnaire. From what I can tell, this is not required and, as we currently disclose sustainability related information in many different places and to many different people, we’re not inclined to voluntarily add another to the list. However, I was curious what other companies who received this letter intend to do. Would appreciate your thoughts here.
04/15/2025, Question #27998