CCRcorp Sites  

The CCRcorp Network unlocks access to a world of insights, research, guides and information in a range of specialty areas.

Our Sites


A basis for research and practical guidance focusing on federal securities laws, compliance & corporate governance.


An educational service that provides practical guidance on legal issues involving public and private mergers & acquisitions, joint ventures, private equity – and much more.


The “one stop” resource for information about responsible executive compensation practices & disclosure.

Widely recognized as the premier online research platform providing practical guidance on issues involving Section 16 of the Securities Exchange Act of 1934 and all of its related rules.


Keeping you in-the-know on environmental, social and governance developments

ESG ratings have been the subject of controversy for some time. Notorious for their inconsistency across raters, opaque proprietary methodologies, and questionable performance indicators, ESG ratings have been thoroughly criticized on multiple fronts. However, that hasn’t stopped investors and other industry participants from using them. Recently, international law firm Mintz published a memo explaining ESG ratings and their common pitfalls and critiques. There was one novel concept that stuck out to me in this memo – the idea of ESG ratings creating litigation risks:

“Companies using ESG ratings products could encounter litigation risk, whether from public or private plaintiffs. Under the Biden Administration, several federal agencies have launched investigations to monitor companies’ ESG compliance. These actions have primarily targeted inconsistencies between companies’ ESG-related policies and conduct, on the one hand, and public disclosures on the other, but such enforcement activity could readily extend to the use of ESG ratings.”

This could manifest in several ways, such as:

  • Companies that use positive ESG scores in their advertising. Hypothetically a company could tout their ESG credentials by pointing consumers to a positive ESG score received from a rater. However, there may be a disconnect between what a positive ESG score means and what a reasonable consumer would expect an ESG score to mean, thus potentially resulting in a misleading statement and greenwashing litigation.
  • It could create another risky scenario for sustainable finance. A fund could market itself as being ESG-friendly or promoting ESG values using ESG ratings as part of the fund’s selection methodology for its portfolio. In this case, if the ESG rating doesn’t accurately reflect the ESG reality of the portfolio companies, then that could potentially translate to a misleading statement on the part of the financial institution and open them up to litigation risks from customers or regulators.

ESG ratings will continue to exist. Rated companies cannot control how third parties use their data and how others rely on that data, but companies can protect themselves by being careful in how they message around their own ESG scores.

If you aren’t already subscribed to our complimentary ESG blog, sign up here: for daily updates delivered right to you.

Back to all blogs

The Editor

Zachary Barlow is a licensed attorney. He earned his JD from the University of Mississippi and has a bachelor’s in Public Policy Leadership. He practiced law at a mid-size firm and handled a wide variety of cases. During this time he assisted in overseeing compliance of a public entity and litigated contract disputes, gaining experience both in and outside of the courtroom. Zachary currently assists the editorial team by providing research and creating content on a spectrum of ESG… View Profile