By Brad Rosen, J.D.
The Biden Administration scored a major victory for the sustainability cause in 2022 with the enactment of the Inflation Reduction Act (IRA), game changing legislation that advances clean energy and climate. Many federal agencies and executive branch departments also moved ESG initiatives forward, including the SEC’s introduction of its historic climate-risk disclosure proposal, as well proposed rules to improve ESG fund practices. The agency also launched numerous enforcement actions to combat greenwashing and other ESG missteps.
2022 was also a banner year for ESG opponents who claimed a major victory with the Supreme Court’s decision in West Virginia v. EPA, a ruling that constrains the ability of federal agencies to address climate change. Additionally, inspired by Florida Governor Ron DeSantis, who decried “woke” ESG polices and ushered in the Stop W.O.K.E Act, Republican-controlled states across the country adopted anti-ESG legislation.
With Republicans taking back the House next year after a slim electoral victory in the November midterms, the drumbeat to pushback and squash climate and ESG related measures promises only to intensify. Republican lawmakers have already indicated their intention to squelch the SEC’s climate disclosure proposal, and investigate potential antitrust law violations by companies and their lawyers in connection with ESG activities. Meanwhile, ESG proponents and Democrats have demonstrated they are ready to stand their ground.
You can read the Strategic Perspectives, A thoroughly mixed picture for ESG in 2022: Major accomplishments amid significant setbacks, with fierce battles on the horizon, here.