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. Florida’s Attorney General is the latest to announce an investigation into ESG and antitrust. However, instead of targeting financial institutions or climate pacts as Texas has done, Florida’s AG is investigating CDP and SBTi. Trellis reports:
“The attorney general’s statement accuses both CDP and SBTi of ‘selling services to obtain better scores and public endorsements’ and ‘creating incentives for corporations to pay in exchange for favorable treatment.’ Uthmeier also alleges that SBTi ‘sells companies validation of their climate goals — then directs them back to CDP to report their progress, creating what appears to be a profit-driven feedback loop.’ The SBTi’s near-term and net-zero standards both recommend CDP as a disclosure option but do not require companies to disclose emissions via a specific platform. The investigation will also dig into potential antitrust violations, focusing on whether ‘coordination’ between CDP, financial institutions and investment services amounts to market manipulation.”
Concerns about self-dealing are a legitimate problem that ESG has faced in the past. However, this typically arises in the context of ESG ratings when a ratings firm also has a consultancy arm. While many of those business practices led to increased scrutiny and some regulation of ESG ratings agencies, such behavior was never challenged on antitrust grounds. While the legal ground may be shaky, Florida’s investigation could constitute another instance of “lawfare” being employed by anti-ESG to hinder pro-ESG organizations through prolonged legal battles and hefty attorneys’ fees. As I’ve written before, Anti-ESG doesn’t have to win in the courtroom to succeed in the boardroom.
We’ll be discussing the latest developments in Anti-ESG’s antitrust litigation at our upcoming webinar, “ESG Litigation Landscape 2025.” Members can mark their calendars for August 12, at 2:00 p.m. EST to catch the program live or watch the playback at their convenience.
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